Emirates – a new direction?

Emirates – a new direction?

As ATM 2019 rapidly approaches, I’m delighted to say that Sir Tim Clark, President of Emirates, will be our first guest for the aviation programme.  Sir Tim’s words are always awaited with baited breath so I’d expect a full room, don’t get there too late if you want a seat!

I last spoke with him at the 2015 show and there’s an awful lot to catch up on.  Emirates is still very much in the airline premier league as well as being the leader in its home region, the Gulf, but it’s had to confront quite a number of challenges in recent times.  Like all airlines it has seen profitability dented by recently higher fuel prices and it’s also been battered by a number of geo political challenges in the region which have dampened demand.  On top of this, competition has increased with the emergence of some new direct services between Asia and Europe offered by new breed Long Haul LCC’s (LH LCC’s), which have been snapping at some of Emirates business.

But the airline has never been one to sit back and just let things happen.  It’s in the midst of some major product, fleet and network changes, which acknowledge the new tougher market conditions in which it finds itself.

The airline is refreshing its all important first and business class products but it is also taking a leaf out the Low Cost airline book in the price-sensitive economy cabin, by charging for extras such as seat assignment.  But what I think is a really interesting step is that Emirates will be introducing a premium economy cabin over the next couple of years.  This is definitely something I’ll be asking Sir Tim about, as the airline has been reluctant to make such a move until now.  It’s increasingly becoming a lucrative cabin for many airlines, allowing them to tap into customers who can’t afford the step to business class but who are prepared to pay a premium over economy, for some extra comfort and service.  It’s going to be interesting to see what Emirates has in store!

On the fleet side of things, Emirates has long been a leader and Sir Tim’s voice is one that the manufacturers have to listen to.  Emirates has maintained a two type philosophy for a number of years, with the ultra large Airbus A380 and the large twin Boeing 777 being the only aircrafts that it has employed.  However, a significant switch in its strategy began apparent a couple of years back, at the Dubai air show, when Emirates handed Boeing an order for the Boeing 787 Dreamliner, a somewhat smaller aircraft than Emirates has been used to for some time.  This order reflects the need to increase flexibility in the amount of capacity deployed on some routes where competition from direct flights and long haul LCC’s has impacted its business.  It also reduces the risk of starting new routes where demand may not justify a larger aircraft.

Still on the fleet theme, the big recent news was Emirates’ announcement that it was to reduce its outstanding order for the ultra large Airbus A380.  In effect, this order reduction was the death knell to future production of this very passenger-popular aircraft by Airbus, which has seen a dearth of orders from other airlines, along with the cancellation of some existing orders.  Emirates already has well over 100 A380s in its fleet so fortunately we can expect to see the plane around for many years to come.  But it too has switched to Airbus’ newer more efficient twin jet, the A350, for new orders. Sir Tim is always fascinating to talk to on these weighty issues so I’m looking forward to this opportunity!

More broadly the airline has renewed its commercial partnership with Qantas and is rolling out an expanding cooperation with Dubai’s other airline, Fly Dubai.  This is providing many more itinerary opportunities for customers as well as proving new efficiencies on the planning of schedules.

This is going to be an exciting session and if there’s more you’d like me to ask Sir Tim then let me know between now and the show!

Read more about the upcoming interview with Emirates CEO, Sir Tim Clark. Register now to see this unmissable session.

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Director, John Strickland, is a graduate of the University of York and has held senior positions with a number of airlines including British Caledonian, British Airways, KLMuk and Buzz. John was instrumental in the decision by KLM to establish the low cost operator Buzz and in its selection of new routes. His 40 years of experience have exposed him to the business models of regional, global, legacy and low cost carriers. JLS Consulting was established in 2003 and now serves a growing range of clients including airports, airlines, investors and those whose businesses require strategic insight on and advisory services concerning the air transport sector. John regularly devises and chairs panel discussions and interviews senior executives at industry conferences and events. Media work is undertaken for numerous global media organisations including the BBC, CNN, Sky, Al Jazeera, and business specialists Bloomberg and CNBC. John also contributes to a wide range of respected written publications including the Financial Times, Wall Street Journal/Dow Jones Newswires, Business Week, The New York Times, Gulf News, Reuters and AFP.

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