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30 Feature AVIATION


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5 Hamad International Airport, Doha 6 Akbar Al Baker, Group Chief Executive, Qatar Airways 7 flydubai, Business Class 8 James Hogan, outgoing President and CEO, Etihad Airways 9 Oman Air 10 The Residence, Etihad Airways


AVIATION SESSION


11am to 12pm APRIL 26


John Strickland talks to Jaan Albrecht, CEO, Saudi Arabian Airlines Group on the Global Stage.


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UAE flag carrier Etihad Airways says partnership strategies will remain essential to the growth of its business


“Emirates will continue to pursue its strat-


egy of organic growth, leveraging the geo- centricity of the UAE and Dubai’s dynamic developments in tourism and commerce.”


NEW ROUTES TO GROWTH The low-cost carrier market in the UAE, Saudi Arabia and Oman is leveraging ongoing poten- tial with some of the region’s biggest carriers taking a slice of the lucrative market. In 2016, flydubai recorded its fifth year of


profit, with passenger numbers swelling to 10.4 million, compared to 5.1 million in 2012. Commenting on the success, flydubai


Chairman, HH Sheikh Ahmed bin Saeed Al Maktoum, says: “This demonstrates the airline’s role in changing the way both business and leisure passengers travel around the region. An established tourism destination and global centre for business, together with the UAE’s geographic location, has supported the need for increased connectivity.” In a move that reflects ongoing demand for


competitive fares, flydubai pushed the bound- aries of its route network last year when it launched flights to Bangkok — its first double- daily service outside the GCC. The airline also


recently announced new routes for the summer season – Batumi in Georgia, Qabala in Azer- baijan and Tivat in Montenegro. Meanwhile, Saudi low-cost carrier Flynas


has indicated the extent of its growth by plac- ing an order with Airbus for 80 A320neo- family aircraft. The deliveries are scheduled to take place from 2018 to 2026. This comes after Flynas enjoyed a record-breaking 2016, carrying 6.3 million passengers, up 14 percent year-on-year. The aviation sector in Oman is also capi-


talising on the thriving low-cost carrier market and, in January, launched SalamAir. The sultan- ate’s first budget carrier operates domestic flights between Muscat and Salalah, but plans are afoot to introduce services to destinations including Dubai, Mecca, Medina and Kara- chi. The airline’s chairman Khalid al-Yahmadi believes SalamAir could clinch between 20 and 30 percent of Oman’s aviation market, currently dominated by national carrier Oman Air.


FLIGHT PLANS Political and economic influences aside, the next decade could witness several fundamen- tal changes to Gulf airline business models.


Emirates, which is looking for new reve-


nue streams, expects to introduce a premium economy offering within the next 18 months, although Clark says the carrier is still “at the stage of finding what form premium economy will take”. The Emirates boss is also planning a move away from third-party distribution chan- nels, and instead, is building its own digital retailing platform. “The notion that we should have intermedi-


aries accessing our range of products and charg- ing us for the use of their service — it should probably be the other way around,” says Clark. “As we move to ‘disintermediarise’ the


business and strip costs out of distribution and consumer reach, it is incumbent to create a process so that when someone thinks they want to fly somewhere, they will think of the airline, so intermediaries no longer have a place.” While Emirates focuses on organic growth,


UAE flag carrier Etihad Airways says partnership strategies will remain essential to the growth of its business. Outgoing President and CEO, James Hogan, says the strategy, which contributed 5.5 million guests from partners and codeshares connecting to the Etihad network in 2016, has delivered revenue and synergy benefits.


“We are committed to our equity partner


strategy — it delivers a huge amount to our busi- ness,” says Hogan. “That approach has helped Etihad grow from a US$300 million-a-year (AED1.1 billion) airline to a diversified aviation group, which delivers revenues of more than US$26 billion (AED95.5 billion). “Etihad Airways sits at the heart of that busi-


ness, of course, but is now only one element of a model which includes significant other busi- nesses and investments.” Qatar Airways has bought its way into Inter-


national Airlines Group (IAG), the owner of Brit- ish Airways, upping its stake from 15.67 percent to 20.01 percent in July. IAG and Qatar Airways already work closely together with both enti- ties as part of the Oneworld Alliance. IAG is also said to be “looking at further opportunities” to develop its commercial relationship with Qatar Airways, such as joint procurement initiatives, according to a spokesperson for the airline. Akbar Al Baker, Group Chief Executive of


Qatar Airways, predicts the airline will be priva- tised within the next decade, once the carrier is “in a position of strength”, which connects well into a broader diversification plan for the Middle East’s thriving airlines.


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