Fly me to the boom: the rise of Emirates and Etihad

With just ten minutes to go, tensions are running high inside Manchester City’s Etihad Stadium. It’s mid September, and the reigning Premiership champions are a goal up against Arsenal. The posters of the club’s owner, Sheikh Mansour, are beginning to appear, in anticipation of another victory.

“Don’t mess with Abu Dhabi!” chants Dave, a 62-year-old lifelong City fan.

Moments later, Laurent Koscielny stuns the 47,805 crowd with a headed goal for Arsenal, sending their fans into ecstasy. Michael , also 62 and a lifelong Arsenal fan, is delirious. “You’ll never beat the Emirates! You’ll never beat the Emirates!”

As the fans spill out of the stadium after the match, one Arsenal fan, almost surreally, begins chanting at his Manchester City rivals: “At least we’ve got the A380!”

Three and a half thousand miles away, sitting in Dubai and Abu Dhabi, the senior management of Emirates Airline and Etihad Airways can hardly believe their luck. This is not meant to be a good time to be in aviation. The airline industry, which has been in a downward spiral since its peak in 2010, is forecast to earn $4.1bn in profits this year, according to the International Air Transport Association. That's slightly up from the agency’s original estimate of $3bn in profit, yet still 78.6 percent lower than the high of $19.2bn earned by carriers two years ago.

Yet Emirates continues to be one of the fastest growing airlines in the world. In spite of unstable global economic, geopolitical and environmental conditions, it can’t seem to stop making profit. In the first half of the 2012-13 fiscal year, its net profit more than doubled to $464m from $228m in the same period a year ago. It now flies to 126 destinations, up from 114 last year, and 74 countries, compared with 67 last year. The airline has launched five new destinations since 1 April this year alone. Emirates is already the world’s biggest customer for the Airbus A380, and the largest customer for Boeing's wide-body 777.

Etihad Airways has only been in existence for nine years. Back in 2006, it set 2011 as the breakeven year, yet — against all the odds — it somehow managed to turn in a $14m profit last year. It carried a staggering 8.3 million passengers during the year.

 From its hub at Abu Dhabi International Airport, Etihad Airways serves 86 passenger and cargo destinations in 56 countries, with a fleet of 67 Airbus and Boeing aircraft, and over 90 aircraft on firm order, including ten Airbus A380s. It also has equity investments in airberlin, Air Seychelles, Virgin Australia and Aer Lingus.

From codeshares to equity deals, new routes and plane orders — and spectacular sponsorship deals such as the Emirates Stadium in London and Etihad Stadium in Manchester, the UAE airline giants have not only bucked the global aviation trend, but appear to be on a path of unstoppable growth.

The only two people not fazed by the numbers are Emirates president Tim Clark and Etihad Airways CEO James Hogan. Both veterans of the industry, they have also fast become the envy of the airline business.

“We run our business differently. We are opportunist. Our strategies seem to be paying off. Our profits are down but everybody’s profits are down — but we’re making money despite the adversity and the trading conditions elsewhere,” says Clark, speaking from his headquarters in Dubai.

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Posted by: Glen

You missed nothing, the April fools are the customers who go back to Etihad after registering losses with them due to bad handling of baggage, without any response or compensation and then fly with Etihad again.

Etihad has zero customer after sales service, once they get the fare, forget about any claims with them.

Posted by: johnnny

Etihad only made profit last year by getting the ownership of the aiport operator (Abu Dhabi's equivalent of dnata) transferred from Abu Dhabi airports to Etihad a few weeks before the end of 2011. With it was transferred the full year revenue (and significant profits) without this Etihad would never have been even close to making profit.

Posted by: Peter John

That intro? This did not happen. Utter fabrication.

Posted by: Shirley

OMG!!!! You have GOT to be kidding!!!!

I have grave doubts that the author has ever been to England let alone to a Manchester City game. Hysterical.

Did I miss something or is it April Fool's in the UAE?

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