Privately owned Bahrain Air continues to struggle to establish its place in the Gulf Cooperation Council region, which has a proliferation of flag carriers and no-frills operators. After making its first passenger flight in February 2008, Bahrain Air has seen its passenger count rise to 720,000 in 2010, only to decrease to 640,000 last year, amid the global economic downturn and the internal troubles of its home country. CEO Richard Nuttall does not expect passenger numbers to increase this year.

The airline operates two Airbus A319s and two A320s, with the A319s due to return to lessors in 2014 or 2015. “We know that the current size of the fleet does not work long term,” Nuttall said, adding that he is working on options to replace the A319s and considers a fleet of nine aircraft as optimal. Bahrain Air previously had six aircraft, but traffic-rights issues and government intervention forced it to restrict operations on some routes. “At the present time, the Bahrain government will not allow us to fly to Iran or Iraq,” Nuttall said.

The original plan envisaged Bahrain Air as a low-cost carrier. Now Nutall speaks of a “premium value” airline, which offers passenger connectivity, rather than just point-to-point services, in a model that makes it a near “full-service” carrier. Bahraini interests own 65 percent of Bahrain Air while Saudi interests own the other 35 percent.

Bahrain Air claims to operate 79 flights a week to 21 destinations, although two of these remain to be finalized. Doha alone is served by 16 flights a week. Nuttall hopes the carrier can add 15 additional routes, including five more to India and three each to Egypt and Pakistan, through 2016.

Meanwhile, the long-term future of Bahrain’s Gulf Air, which shares 80 percent route replication with Bahrain Air, remains unclear. Nuttall said competition between the two carriers is sometimes “beyond healthy” and that the government is wondering “whether it can afford Gulf Air in its current format.” When asked about the possibility of a merger of the two airlines, he said there are a number of possible scenarios. “If there is to be a merger with Gulf Air, that is a solution we are open to,” Nuttall said, but added, “there is nothing on the table [at the moment].”