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Mon 17 Jul 2017 10:51 AM

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Emirates, flydubai join forces with new agreement

Partnership includes codeshare agreement, network synergies and combined fleet

Emirates, flydubai join forces with new agreement

Emirates and flydubai on Monday announced a significant partnership agreement that will see the two airlines join forces for the first time.

Under the partnership, the Dubai-based carriers will operate an “expansive” codeshare agreement, as well as increased schedule alignment and network optimisation to more than 200 destinations, they said in a statement.

The two airlines’ combined network is expected to cover 240 destinations by 2020, served by a combined fleet of 380 aircraft, the statement added.

The agreement will also see alignment of frequent flyer loyalty programmes, providing benefits to customers of both airlines.

However, both airlines will continue to be managed independently with no plans for a full merger, they said.

Emirates chairman Sheikh Ahmed bin Saeed Al Maktoum told Arabian Business in April that Dubai’s flagship carrier was seeking “greater synergies” with flydubai as it continues to streamline costs in a turbulent aviation market.

In May, Emirates reported an 82 percent drop in net profit in the year to March 31 – the first time since its 2011-12 fiscal year that the airline’s annual profit had fallen.

Emirates cited fierce competition and a “relentless rise” in the US dollar as the main factor in falling revenues.

Meanwhile, flydubai’s profits dropped 68 percent in 2016 after a tough year – but its revenues rose 2.4 percent, it reported in February.

The low-cost carrier’s CEO Ghaith Al Ghaith said at the time he expected 2017 to be another “challenging year” and said the airline would remain “prudent”.

Emirates and flydubai said in a statement on Monday: “The innovative partnership goes beyond codesharing and includes integrated network collaboration with coordinated scheduling.

“The new model will give flydubai customers seamless connectivity to Emirates’ worldwide destinations spanning six continents. For Emirates’ customers, it opens up flydubai’s robust regional network.”

The statement said the two airlines will also further develop their hub at Dubai International Airport by aligning their systems and operations.

An Emirates spokesperson declined to comment on whether plans would be hatched to construct an internal link between flydubai’s hub Terminal 2 and Emirates’ Terminal 3.

Sheikh Ahmed said: "This is an exciting and significant development for Emirates, flydubai, and Dubai aviation. Both airlines have grown independently and successfully over the years, and this new partnership will unlock the immense value that the complementary models of both companies can bring to consumers, each airline, and to Dubai.”

Emirates has a wide-body fleet of 259 aircraft, flying to 157 destinations, while flydubai operates 58 new-generation Boeing 737 aircraft to 95 destinations. The current combined network comprises 216 unique destination points.

Teams from Emirates and flydubai are currently working on several initiatives spanning commercial, network planning, airport operations, customer journey, and frequent flyer programmes alignment.

The partnership will be rolled out over the coming months, with the first code-sharing arrangements starting in the last quarter of 2017, the airlines said.

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