Thinking big by buying small

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At this week’s Dubai Air Show, sales of $150 billion of aircraft to the big three Gulf carriers (Emirates, Etihad and Qatar Airways) overshadowed a more intriguing development. Standing by its well-established reputation for snapping up airline stakes, Etihad—the Abu Dhabi-based flag-carrier of the UAE—paid an unknown sum for 33.3% of Darwin Airline, a carrier serving Europe’s beleaguered regional market. Etihad already owns chunks of Air Berlin, Virgin Australia, Air Seychelles, Ireland’s Aer Lingus and India’s Jet Airways, and is working to buy a stake in Air Serbia. Investing in a tiny carrier that deploys 50-seat aircraft may seem insignificant compared with these bulkier partnerships, but Etihad's chief executive, James Hogan, calls it a “step-change” in his airline’s strategy...

Interview: Tewolde Gebremariam, Ethiopian Airlines CEO

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Having grown its revenue 700% since 2005, you might presume that Ethiopian Airlines will enter a period of consolidation over the coming years. But you would be wrong. The flag carrier is planning to expand another fivefold by 2025, doubling its fleet in the process and establishing a network of hubs across the continent.

“If you divide the history of the airline into two, you can speak of the last seven years and the previous 60 years,” chief executive Tewolde Gebremariam tells Routes News. “Back in 2004/05, we saw that the opportunities for expansion were limitless, based on our geographical location and the high-growth regions we serve … Our mantra and strategy has been fast, profitable and sustainable growth...

Jetihad: Family fortunes

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In October, after six months of wrangling, Abu Dhabi’s Etihad Airways secured the approval of India’s cabinet to acquire 24% of Mumbai-based Jet Airways. The $379 million deal was made possible by a decision to relax foreign ownership restrictions last year, but the country’s regulatory bodies put up fierce resistance before giving the final go-ahead. India’s second largest carrier now joins the growing family of airlines part-owned – and indisputably part-controlled – by Abu Dhabi’s flag carrier.

The partnership should be exceptionally lucrative for both sides. Once fully consummated, it will see Etihad’s reach in India expand from nine to 26 cities. That will give the Gulf carrier a foothold in one of the world’s fastest growing aviation markets, which already handles 150 million passengers a year...

Interview: Marwan Boodai, Jazeera Airways Chairman

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When Jazeera Airways posted an annual loss of KD8.2 million ($28.4 million) in 2009, the outlook appeared bleak for Kuwait’s fledging private aviation sector.

The emirate’s much-vaunted liberalisation drive had now produced two struggling private carriers – also including Wataniya Airways, which was months away from bankruptcy – and flag carrier Kuwait Airways continued its two-decade-long run of almost uninterrupted annual losses.

For Jazeera chairman Marwan Boodai, however, the finger of blame was pointing squarely outside of Kuwait. He believed that larger regional competitors were dumping capacity in the emirate in order to re-route traffic through their own hubs. The success of Jazeera’s subsequent turnaround plan appears to have validated that judgement...

Interview: Paul Griffiths, Dubai Airports CEO

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Dubai World Central will be the world’s largest airport when it is completed in the mid-2020s. But Dubai Airports CEO Paul Griffiths tells Martin Rivers that the future aerotropolis is about much more than scale.

When Concourse A opened at Dubai International Airport (DXB) in January 2013, the benefits of travelling through the purpose-built Airbus A380 facility were immediately apparent to passengers. As well as allowing Business and First Class customers to board aircraft direct from their lounges, the 11-floor concourse features two hotels and 11,000 sq m of retail space. It has cemented DXB's status as the world's foremost A380 hub, with the airport handling 7,259 of the double-decker flights last year...

Interview: Thierry Antinori, Emirates CCO

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Few people familiar with the history of Emirates Airline will have been surprised by news that the Dubai flag-carrier plans to more than double its US network over the next five years.

For an airline that receives an average of one Airbus A380 each month – not to mention its growing fleet of Boeing 777-300s – expansion has become the norm. Emirates today serves 135 destinations across 77 countries, with its steady stream of route launches most recently including Angeles in the Philippines, Conakry in Guinea and Sialkot in Pakistan.

But growth of the network only tells part of the story. As Emirates gears up for its widely-expected 777X order at the Dubai Air Show in November, chief commercial officer Thierry Antinori is turning his focus to in-flight enhancements tailored for this new breed of wide-body aircraft...

Interview: Ghaith Al Ghaith, FlyDubai CEO

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FlyDubai took an unexpected turn in June when it unveiled a new Business Class product. Chief executive Ghaith Al Ghaith tells Martin Rivers why the low-cost carrier is going down the premium path.

The first FlyDubai service offering Business Class took off for the Ukrainian capital Kiev on 8 October, sporting 12 premium seats finished in Italian leather and with a generous seat pitch of 42 inches. By the end of 2013, the number of destinations benefiting from the two-cabin configuration will have risen to 27...

Mr O'Leary takes to Twitter

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A lot can change in three months. In mid-July I spoke to Michael O’Leary, the chief executive of Ryanair, Europe’s largest low-cost carrier. He said that Ryanair deliberately “tortures” its passengers when they check in bags; that the airline industry is populated by a bunch of “losers” and “lemmings”; and that Ryanair’s ideal customer is someone with “a pulse and a credit card”. Standard fare, then, for the industry’s most-outspoken boss. But then last month Ryanair issued an unexpected profit warning, and Mr O’Leary grudgingly told shareholders that he will stop “unnecessarily pissing people off”...

Frequent flyers: Building custom

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A recent survey of 2,500 passengers by Deloitte, the financial advisory firm, found that 72 per cent of high-frequency business travellers participate in more than one airline loyalty programme. Few people will be surprised by that statistic. But it underscores how airlines – which already operate the most complex loyalty schemes of any sector – must continue innovating their frequent flyer programmes (FFP) to incentivise repeat custom.

Texas International Airlines launched what is widely regarded as the first modern FFP in 1979. It was followed two years later by the more advanced American Airlines AAdvantage and United Airlines MileagePlus programmes. Both schemes are still operated today, but their breadth and scope has changed profoundly over the past two decades...

Interview: Philippe Moreels, Czech Airlines CEO

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Late last year, CSA Czech Airlines was among the scores of central and eastern European carriers desperately seeking the lifeline of foreign direct investment. Miroslav Dvorak, chief executive of parent company Czech Aeroholding, told local press there was a 70% chance the airline would fail in its hunt for a strategic investor. Comparisons with Malev, Hungary's collapsed flag carrier, abounded.

But in March, Korean Air made good on an early expression of interest and agreed to purchase 44% of CSA. The loss-making Czech flag carrier has since re-entered the long-haul market with an Airbus A330 leased from its new partner. While growth is not on the agenda for now – CSA halved its fleet over the past three years under a restructuring programme – chief executive Philippe Moreels believes the airline has re-defined its "strategic raison d'être" and secured its long-term future...