Wednesday, November 27, 2013

Emirates, A Force of Stability or Disruption

Emirates, the largest international carrier and the oldest of the three Gulf Global Airlines, evokes confidence, distrust, and a sense of foreboding  with every decision it makes from buying aircraft to announcing new routes

If you are Airbus or Boeing, you value Emirates as a force of stability in aviation. Six (6) weeks after 9/11, when legacy airlines all over the world were reeling from the events of that day: grounding aircraft and laying off employees specially in the USA and Europe. Emirates, during the Dubai Airshow 2001, did the unthinkable and ordered USD 15.6 Billions worth of aircraft.

  • Twenty five (25) B777s
  • Twenty Two (22) A380s
  • Eight (8) A340-600s
  • Three (3) A330s
In Dubai Airshow 2013 Emirates did it again it helped launch the B777X with an order of one hundred and fifty (150) plus another fifty (50) options and ordered another fifty (50) A380s helping Airbus to stabilize the A380 production line for the near future.

Undoubtedly, Emirates is (was) rewarded for its good deeds with very attractive pricing, well below what the competition gets. Something that reflects favorably on its yields and financial results.

On the other hand, legacy carriers specially Delta, American, Qantas, Air Canada, Air France and Lufthansa considered Emirates (Etihad and Qatar Airways) as mere toys of oil rich desert princes and heavily subsidized government airlines. They are considered by Delta and the A4A as the most disruptive force in the industry. 

Fast forward to the present and the critics of yesterday are the partners of today
  • Qantas has a great agreement with Emirates, resulting int the transfer of its Singapore hub to Dubai. The deal has been profitable for both airlines;
  • Air Canada whose position on additional frequencies for Etihad and Emirates escalated into a diplomatic rift between the UAE and Canada, now has a code share with Etihad;
  • Qatar Airways is a member of One World;
  • American Airlines and Etihad has a code share agreement; and
  • Air France KLM has signed a very deep and extensive code share agreement with Etihad.
It is understandable when EU airlines complain about the Gulf airlines, they actually compete with them; directly between their respective hubs and on connecting traffic to Europe, USA and Latin America. These new entrants have shifted the center of aviation, from Europe as a hub between the Americas and the other side of the globe, to their Gulf hubs. US airlines never really competed directly with Emirates or the other two global airlines, so the complaining and whining is somewhat surprising.

Emirates competes on service, passenger amenities and convenience. Their First and Business classes are rarely discounted and if you think their fares are low, think again, they are not. However, the service is exemplary, their seats and cabin are leading edge and ICE (their IFE system) is out of this world. Emirates knows how to fill its flights. They actually make money, not because they are subsidized but because they keep airplanes full at the right yields, and they buy their aircraft at the right time and the right price.

They also sponsor sports clubs and events, spending millions of dollars to make sure that the name of Emirates is seen by millions of people across the globe while watching soccer, tennis or Formula 1 among others. Emirates and the others invest in lounges, media promotions and sports to keep the brand global.

Emirates works hard at increasing the productivity and efficiency of its operations, but it pays attention to its expansion.

 Emirates Vision and Values clearly explains their methodology for success

A strong and stable leadership team, ambitious yet calculated decision-making and ground-breaking ideas all contribute to the creation of great companies. Of course, these have played a major part in our development, but we believe our business ethics are the foundation on which our success has been built. Caring for our employees and stakeholders, as well as the environment and the communities we serve, have played a huge part in our past and will continue to shape our future.











No comments:

Post a Comment

Labels

1 Goal 2010 2012 2013 9/11 AA Abu Dhabi ADAC Air Arabia Air Canada Air India Airberlin aircraft airlines airports ambitions American Airlines Amman aviation AVOD AWST B707-300C B767 B777 B787 BA Bahrain Bahrain Air BangaloreAviation Boeing branding British Airways Business Aviation Cabin Crew Canada change chapter 11 CO Commercials communication community compliance contingency continuity Continuous Improvement cost effective creativity Culture curricula Customer Service Delta Detroit Metro DFW Doha DTW Dubai Dubai Air Show DWC efficiency emergency Emergency Response Emirates employees environment ET409 Etihad ETS EU FA FAA family Flight Attendants flight(s) Flightglobal flydubai GACA Galaxy Tablet GAMCO GCC globalisation GOL Greece Green Gulf Air Hala Hamburg happy health home Hopenhagen Human Resources IFE India Iran Iraq Iraqi Airways Jaffa Jazeera Airways Jet Airways Jordan Just Culture Kuwait Airways LA LCC leadership low cost maintenance management manpower MEA MEBAA MENA Michigan motivation MRO MROAM Oneworld Palestine passengers passion people Philadelphia planet earth Privatization professional QAIA Qantas Qatar Qatar Airways Quality Quick Service Restaurant Radio Repair Stations Risk road roots ROTANAJET Royal Jordanian Safety Sanctions. Sao Jose Dos campos SAT Saudi Arabia Saudi Arabian Airlines Security Sharjah Airport SimliFlying Simplicity SKYTEAM SMS social media Southern California Southwest Airlines Star Alliance Sudan Airways support target teachers Technology terrorism tolerance Toulouse tourism traffic Training transition travel TSA Turkey Twitter UA UAE UBM US Airways VIA Rail Violin Vision volcanic ash Wataniya Airways
 
Top Blogs
Powered By Invesp