By Sir Tim Clark
Transport: flying into the future of aviation
2017 brought its share of opportunities as well as curveballs. Our operations were challenged by short-notice changes to entry requirements into the US, the cabin electronics ban, updated security measures, and continued capacity challenges at our busy hub.
On the commercial front, our margins were compressed by competition. We had to tough out a sluggish global trading environment with a tick down of key European economies, and political and security shakiness across the globe. The measures imposed by the new US administration in the early part of the year also dampened confidence and demand for travel into the US. But as everyone settles into the new normal, we’ve begun to see a gradual pick-up to pre-2017 levels. The upward movement of oil prices has been a double edged sword – adding to our costs, but also stoking the fires of economic recovery.
At Emirates, we worked closely with our partners to tackle the challenges with agility, and limit any negative impact on the experience that we offer our customers. We then knuckled down to our longer-term plans of ensuring our business is future fit. Though starting our financial year with lower profits than we’d have liked, thanks to the tenacity of our workforce, we quickly rebounded and at the half-financial year mark our efforts were paying off.
We continued to grow our operations in Europe, we’ve expanded our services into China with Beijing and Shanghai becoming all-A380 operations, and we’ve added new South East Asian cities. The US has not wavered on its longstanding Open Skies policy despite the Big Three’s lobbying campaigns to shut us out. The aviation protectionism war of words may continue, but it has produced very little aside from dramatic headlines in the media.
During the year, we reaffirmed our partnership with Qantas and have signed up for another five years, pending approval. We also announced a significant partnership with flydubai, which will continue on an upward trajectory as we announce further developments in the coming months.
Looking ahead to 2018, we are seeing welcome signs of a global uptick. Air cargo, traditionally a bellwether for economic health, is registering growth after years of languishing yields and demand. Emirates SkyCargo is in a strong position to ride the upswing with its investments in state-of-the-art facilities, and tailored services for growing verticals such as pharmaceuticals, fresh produce and precious cargo.
Internally, our digital transformation projects will drive our competitive edge. We are building these capabilities at the same time as harnessing our innovation partners – such as Carnegie Mellon, Oxford University, Dubai Future Accelerators and The Aviation X-Lab.
We move forward with our customary vigour and confidence. Our business has been tested many times before, but Emirates has always come out stronger because we keep our sights on the things that matter – delivering the best possible services to our customers, and doing it by investing in our people, our products and continued innovation.