By Claire Ferris-Lay
Airline chief says economy class ticket sales recovering, upbeat on profitability.
The CEO of Etihad Airways, the national airline of the UAE, remains “bullish” about the aviation industry but says the economic climate will continue to be tough in 2010, he told Arabian Business.
“It will be a tough year but we’re bullish,” James Hogan said. “Like any other business we’ll have to focus on our cost but we’re also growing as a business.”
Economy ticket sales are already starting to come back but business class seats will take longer, added Hogan.
“The economy traffic we are pretty bullish about; we can see the sales, we can the forecast in yields at a level we like to see them [but] the issue is the business traffic,” he said.
He added that there is already some improvement in business class ticket sales on long haul flights to Chicago, Melbourne, New York and Toronto.
Middle East airlines have managed to withstand the global economic downturn better than others. Regional carriers posted a 10.4 percent increase in passenger demand in the first 11 months of last year, according to the International Air Transport Association (IATA).
Despite the increase in figures, in November, Etihad pushed back its profitability target to 2011, a year later than originally expected. The airline expects to see its revenues exceed $3bn in 2009.
Hogan said he remained confident that the carrier would achieve its new deadline for profitability. “If we can get the yields…back to the same levels we had in 2008 we’ll achieve that…The actual [ticket] pricing we need, we’ve been there before,” he said.
“What is good is Abu Dhabi with the Grand Prix, Yas Island. We are seeing more conferences coming to Abu Dhabi, we’re seeing more businesses becoming more established in Abu Dhabi so as Abu Dhabi grows that also helps Etihad,” he added.