Royal Jordanian’s bet on India and the Levant

Editorial context

Royal Jordanian has a smaller home market and fewer aircraft than its Gulf neighbours. Karim Makhlouf’s answer is not to copy their megahubs, but to make Amman, the Levant and carefully selected Indian routes do different work.

The competitive map is the starting constraint

Amman is not Dubai. Its geography gives Royal Jordanian access to European, North American and Levantine traffic, but the airline operates within reach of very large competing transfer systems. Karim Makhlouf’s experience at Germanwings, Gulf Air and SaudiGulf makes his account of the trade-off unusually concrete. Airline strategies often begin with an expansive target network and work backwards to aircraft. Makhlouf instead argues that the first decision is which flows the airline has a chance of winning. A regional flag carrier cannot sustainably imitate the product breadth, frequencies and marketing expenditure of Gulf megahubs without matching their capital base. Its comparative advantage must be defined at the itinerary level: direct access to Jordan, practical connections to less-served neighbouring markets and coherent price and schedule propositions. That is a narrower strategy, but a more testable one.

The Levant is a network thesis, not a map label

Makhlouf describes the Levant as the second pillar of the carrier’s plan, a catchment spanning markets whose commercial traffic is partly underserved and whose political environment can change abruptly. The temptation is to read a large combined population as an available addressable market. Population is not demand; demand depends on incomes, travel rules, infrastructure and alternatives. For Royal Jordanian, some markets offer scarce direct service and useful connections via Amman. But there is no guaranteed premium for geographical proximity. A sector that offers geographic convenience can be undermined by visa friction, airspace closure, weak distribution or volatile security conditions. The strategy is therefore both an opportunity and a concentration risk. It deserves analysis at origin-and-destination pair level, not merely by regional demographic totals.

India is more valuable as several markets than one

The resumption of Mumbai and Delhi service poses a useful problem for revenue managers. Indian passengers may be travelling to Jordan itself, onward to Europe or North America, or into parts of the Levant with limited alternatives. These are different customer groups with different fare ceilings, seasonality and willingness to connect. Makhlouf says tourism traffic was initially slower than hoped, while connecting flows to Iraq, Egypt and the region were more promising. That is revealing: an airline’s public route story may emphasise tourism, but the underlying business case can rest on labour, family, trade and connecting demand. The routes’ performance cannot be inferred from their launch announcements. A serious assessment needs booking-origin data, sixth-freedom yield, connection reliability and the share of genuinely incremental traffic captured from other gateways.

Tourism is an inventory-management tool

The carrier’s ExplorJordan approach tries to turn distressed inventory into a more complete customer proposition. Makhlouf discusses packages bundling flights with hotels and experiences, even sketching an illustrative seven-night price. The business logic is subtler than discounting seats. If the aircraft has inventory likely to expire unsold, packaging can attract visitors while preserving the perceived value of a standalone fare. But the apparent gain depends on the net contribution after hotel contracting, distribution, cancellations and service obligations. A package also changes the airline’s exposure: it is no longer merely selling transport but assuring the value of a multi-supplier holiday. The airline must resist promoting illustrative prices as representative yields or using package revenue to mask weakness on the underlying route.

The engine problem is a strategy problem

Royal Jordanian’s fleet renewal illustrates the distance between an orderbook and an operational timetable. Makhlouf describes newer aircraft delays and explains why Embraer E2 equipment had to cover longer European flying than originally intended. That is a practical response to constraint, but not costless: stage length, seat count, baggage, premium demand and schedule robustness change the route’s contribution. Pratt & Whitney geared-turbofan inspection issues across the industry add a separate dimension of availability risk. Aircraft acquisition promises may persuade an investor or a tourism authority; delivered, dispatchable aircraft determine how many passengers the airline can serve. Fleet planning should include disruption scenarios rather than assume every promised aircraft arrives on time and works at planned utilisation.

The premium proposition has to be selective

Makhlouf’s journey through low-cost startups and network carriers exposes why ‘hybrid’ is often an evasive label. At Germanwings, aggressive fares and simpler distribution had a specific market purpose; at Royal Jordanian, long-haul and transit passengers require connections, baggage and service reliability. The latter capabilities cannot simply be added as revenue-generating extras without cost. The question is where a smaller carrier can invest selectively: high-value connecting banks, a dependable front cabin on suitable routes, or destination packages that put otherwise empty aircraft seats to work. Every product should be evaluated against the counterfactual of doing less, better. A multi-product strategy only creates value when incremental revenue outstrips the extra complexity it adds.

Resilience is the real differentiator

Makhlouf reflects on managing teams across different geographies and political contexts. The central implication is that an airline’s commercial model cannot be detached from its institution, culture and surrounding state. A traffic flow that looks good in an annual presentation can disappear after a border closure or sudden change in travel demand. Royal Jordanian’s potential advantage is not invulnerability to those shocks, but a network constructed to switch emphasis between local traffic, connecting flows and tourism. That proposition requires enough liquidity and aircraft flexibility to survive a bad season. The interview thus offers a disciplined counterpoint to the Gulf’s scale race: a smaller flag carrier can aim to be structurally useful without attempting to be universally dominant.