United captures local air market, plans to buy more aircraft

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Mushir Ahmed
Newcomer United Airways has become the country's largest domestic carrier in just a year after its launch, elbowing out struggling GMG and the national airliner Bangladesh Biman, officials said Saturday.
Chairman and the managing director of the company Tasbirul Ahmed Chowdhury said the carrier now controls 68 percent of the domestic passenger markets by operating two Dash-8 aircraft.
"We operate 10 flights a day and 70 flights a week, which is twice the combined number of sorties made by our competitors," said Gilani F.R Chowdhury, marketing director of the company.
Struggling GMG, now into the tenth year of its operation, has been the dominating player in the domestic market, but lost out after a string of debacles in the past ten months.
Biman and the other two private operators, Best and Royal Bengal, control a very small segment of the market, which unfortunately guarantees no profit to any of the operators.
United officials said they have now targetted international routes, claiming their 'purchase-and-grow' business model is the most effective and sustainable for Bangladesh's aviation sector.
"In September, we started flying to Kolkata. In three months we want to add Kathmundu as our next regional destination, provided United's name is included in the bilateral air service deal," Gilani said.
"From the second half of 2009, we will fly to as far as London, Dubai and Kuala Lumpur," he said.
But experts say the three routes --- the most profitable as far as Bangladeshi aviators are concerned -- are where lies the real test for the local private operators.
GMG had enjoyed a slow but steady growth in the local and small-haul regional market until it launched the Dubai flight in February this year to tap into the lucrative Middle East market.
But the much-hyped flight to the gateway to the Gulf proved to be a disaster for the oldest private carrier, as it failed to woo enough passengers despite hiring an expensive Boeing 747-200 to propel its growth.
Insiders said GMG had to suspend the flight in just three months after incurring huge losses, which forced it to send back the hired jet and halt four other international routes to cut back on its expenses.
United Airways marketing chief Gilani said they would not repeat the mistakes, committed by their competitors, while they soar their wings across the globe.
"We think leasing aircraft to boost growth is a bad business model. It proved to be undoing for local operators. Leased aircraft causes unseen expenses and made profit almost impossible," he said.
Launched by a group of Sylheti expatriates, United began its operation on July 10 last year with a Dash-8 aircraft it purchased from the manufacturer, Bombardier of Canada.