AIR TRAFFIC CONTROL
NATS: UK in urgent need of upgrade
UK FLIGHT DELAYS ARE SET TO RISE SHARPLY over the next decade unless its airspace is modernised, leading industry figures have said. Research by the National Air Traffic Control Service (NATS) showed that delays are set to rise from around 90,000 minutes a year today to 4 million by 2030 unless the UK’s “ageing network of airspace structures and flight paths is redesigned to make use of modern aircraft technology”. The call for modernisation comes from Sky’s the Limit campaign group – a coalition of NATS, the Airport Operators Association and trade body Airlines UK. “Much of the UK’s controlled airspace was designed in the 1960s and 1970s for a different era of aircraft and when traffic was less than half of what it is today,” it said in a statement. “Redrawing flight paths and moving away from traditional
ground-based beacons to modern satellite navigation will increase capacity while reducing the number of people who experience aircraft noise and cutting greenhouse gas emissions.”
IN CONVERSATION
Omer Kaddouri, president and CEO of the Rotana hotel group, talks to Paul Revel
Omer Kaddouri
Are you on course to meet your target of operating 100 hotels by the year 2020? Yes, we opened ten in 2016, which is pretty much on target. With the opening of 16 new properties by the end of 2017, we should reach 76 hotels. With an average of ten a year opening, I think we’re going to smash that target.
AVIATION
Rising oil prices to hit airline profits in 2017
RISING OIL PRICES AND SLOWING DEMAND will see airline profits fall for the first time in six years in 2017, the International Air Transport Association has predicted. The organisation, which represents around 260 airlines, said net profits this year will drop 16 per cent to US$29.8 billion next year. Expected higher oil prices will have the biggest impact on the outlook for 2017. Oil prices averaged US$44
a barrel last year, and are forecast to increase to US$55 this year.
Alexandre de Juniac,
IATA’s director general and CEO, said the fall comes after three years of sustainable profits, which is “a first for the airline industry. And after many years of hard work in restructuring and re-engineering the business the industry is also more resilient.”
Do you think the growth in Dubai is sustainable? It’s a question everybody’s been asking for years. But for the past three-to-four years there’s been 10,000 hotel rooms opening in Dubai every year. Today compared to last year, Dubai is down just one-to-two points in occupancy – percentage is still up in the high 70s to 80s. Why does it continue to be busy? Because Dubai is working tirelessly on marketing itself. Business is still strong. Revpar’s been dropping about ten points a year for the last two years, because there are so many hotels – coming in with promotional rates, trying to grab market share. But we’re still running at occupancies of 80 per cent.
What’s your biggest challenge? The geo-political situation in the region – we hope that what’s happening in places like Syria is not going to spread further. This is what people worry about the most. We are seeing positive steps
10 BBT January/February 2017
in Iraq. But Syria – we don’t want it to be the straw that breaks the camel’s back. We’ve overcome crises in the region before, and we hope to do so again – but there’s no sign of that at the moment. And we are all monitoring the price of oil carefully.
What’s your take on the big chains’ aggressive direct marketing to the traveller? We are a small company compared to the big boys. When they sit down and look at how much commission they’re paying, they could be saving billions of dollars every year, so I can understand why they’re doing that. But we are not a giant multinational – we need to work with all platforms. As much as we drive our own website and brands – doubling every year in terms of room nights and revenue – it’s not enough. I’ve said before that we embrace the OTAs. Maybe one day if Rotana amalgamates with a huge company, that will change.
And do you envisage that amalgamation happening? A lot of hotel chains, especially coming out of China, are on the warpath to snap up regional brands, because they want immediate access to certain regional areas where they’re not strong. I know we are attractive to some of the large companies. But we’ve taken 20 years to build what we have today. We’re in control of our destiny, and that’s the way we want to keep it... until further notice! • Read the full interview at
buyingbusinesstravel.com
BUYINGBUSINESSTRAVEL.COM
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