Etihad eyes 15% passenger growth in 2009 - CEO

UAE carrier Etihad Airways on Tuesday announced that it had hit its targets during the first quarter of 2009, but revised down the projected growth in passengers for this year.

The Abu Dhabi-based airline's CEO James Hogan said the company had reached its objectives for seat load factor and its financial performance. He also said he was confident that the demand for first class travel would return despite the continuing economic slowdown.

"We believe that demand will come back and when it does we will be positioned to take advantage of first class travellers," Hogan told a conference at the Arabian Travel Market (ATM) in Dubai.

The carrier's seat load factor target for 2009 was 75 percent, Hogan said, adding: "It's a tough cycle for the first quarter of this year. We hit our numbers and we are entering into a tough second quarter...we are still delivering seat factor worldwide."

He said in the first quarter Etihad achieved a 75 percent load factor across all cabins.

The airline was aiming for 15 percent passenger growth to 6.7 or 6.8 million this year, said Hogan speaking to Arabian Business after the press conference.

The targeted growth is lower than a previous target given by Etihad in March of seven million passengers for 2008, representing a 16.6 percent increase. It carried six million passengers last year.

He said Etihad's passenger target for 2010 would be based on demand during the summer months of 2009, Hogan said.

"Let's get through the summer in regard to next year. This is a cycle, we will come through this cycle," he said.

52 percent of Etihad's traffic was coming to Abu Dhabi, he said.

It unveiled its new first class cabin suite at the ATM, which was revamped at a cost of $70m to feature extra large seating that extend to fully-flat beds, 80.5 inches in length. The new first class cabin contains 12 suites and a large changing room.

The move follows a decision by Qatar Airways to remove first class facilities on four aircraft to accommodate more economy seats.

Hogan said: "A downturn is exactly the time when an airline needs to demonstrate its commitment to the very highest standards of service excellence."

He added: "Seat factor isn't the factor, it's yield at the moment. We are seeing discounting out there worldwide. The challenge for us is to stimulate the markets, stimulate demand and we are doing that at the moment, as are all airlines, and managing our costs very tightly."

On Monday, Etihad announced it was offering UAE travellers bargain basement prices - such as AED200 ($54) flights to London Heathrow - following the launch of a new online sales promotion.

He said he was confident strong demand during the summer months would enable the airline to "stay on track for this year."

He said the airline was looking to break even in 2010.

The airline had no plans to add further orders to the $43bn of new aircraft it would take delivery of between 2012 and 2020, he said.

The first aircraft with the new first class cabin will be a new Airbus A340-600, which is due to enter service at the end of August. The full roll-out of the new suites in the airlines fleet is expected to be completed by the end of 2010.

Etihad is launching flights to Kazakhstan in May and Istanbul and Athens in June.

Last year, Etihad finalised a $10 billion, 51-plane order from Airbus.

Middle Eastern airlines are likely to experience a $900m loss in 2009 as they feel the pinch of the global financial crisis, the International Air Transport Association said in March.

Analysts claim Middle East airlines are struggling to fill seats as travellers hit with the credit crunch look to save cash by not flying.

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