Emirates matches it ambitions.
Emirates is working closely with Dubai airport to make the entrepreneurial centre of the lower Gulf the region's transport hub. Dubai can lay claim to an excellent location from which airlines can tap the Gulf market, an ambition which fits in well with its plans for the time when oil revenues run out. Dubai is determined to establish itself as a trading centre for its future economic development -- and, for that, efficient and reliable communications are indispensable.
The Dubai government's ambitions to be the leading trading, tourism and conference centre in the area fuel the aspirations of Emirates airlines. It claims to be the fastest growing airline in the world. Measured in terms of passenger kilometres flown, it has doubled its traffic from 3.5m in 1990-1991 to 7bn in 1992-1993.
At the cutting edge of Gulf civil aviation, Emirates can also boast a fleet of relatively new aircraft. Last August it took on its 13th Airbus A300-600R, completing an order with Airbus Industrie initiated in 1987. It is now embarking on a major expansion effort which will involve the purchase of seven Boeing 777s with a further seven on option for delivery at the end of the decade.
The long-range version of the Boeing 777s which Emirates has under order will allow the airline to start non-stop routes to destinations in the Far East, Australia, South Africa and, most important, to the United States. At present, only a few Middle East airlines have services to New York, Washington, Chicago or Los Angeles. Emirates says that it is currently negotiating reciprocal rights with each of these countries, and is confident of success.
Emirates was born only eight years ago in 1985. It has succeeded in growing from a fledgling operation to become a medium-sized, self-sustaining operation. Predictably, given the immigrant labour force, its first operations were started to India in October 1985. The following year, additional services were started to Pakistan, Sri Lanka and Bangladesh in South Asia and to Egypt and Jordan in the Middle East.
Routes to Europe (London and Frankfurt) commenced in 1987, and by the end of 1990 Emirates had expanded its operation to cover Damascus, Jeddah, Riyadh, Kuwait and Tehran within the Middle East, as well as Singapore, Bangkok and Manila in the Far East. Since then, new services have been added to Hong Kong and Jakarta in the Far East, to Paris, Rome and Zurich in Europe, and to Abu Dhabi and Dhahran in the Middle East.
Emirates is nothing if not ambitious. Its use of its aircraft fleet is high by international standards since it has so rapidly expanded its worldwide network. It is intent on adding new and lucrative routes to its schedule (to South Africa, for example), but is constrained by capacity from doing so until new aircraft are delivered. In effect, its plans for growth are limited by its financial ability to buy new aircraft and the inevitable time lag before these are delivered.
Competitors wonder about Emirates' commercial viability. The company does not publish accounts, which arouses suspicion that it may rely on the Dubai government for financing. However, Emirates claims that it has made a profit in all but the second year of its operations. Its Airbus fleet has been financed 85-100% by the international banking community, and although the government may make down-payments where financing is less than 100%, the airline stresses that it remains in profit after down-payments are calculated.
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|Title Annotation:||Special Report; Emirates Airlines|
|Publication:||The Middle East|
|Date:||Nov 1, 1993|
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