Etihad remains committed to equity partner strategy, says Hogan

Investments in partner airlines have grown Etihad Group’s revenues from $300m a year to $26bn
Etihad remains committed to equity partner strategy, says Hogan
Investments in partner airlines have grown Etihad Group’s revenues from $300m a year to $26bn, said CEO James Hogan
By Staff writer
Wed 18 Jan 2017 02:29 PM

Etihad Aviation Group remains committed to its equity partner strategy, CEO James Hogan told a conference in Dublin today.

Hogan, speaking at the annual Global Airfinance conference, said that Etihad's partnership strategy, which has been a core element of the growth for its business, needs to be viewed as a long-term plan.

A total of 5.5 million passengers have flown on Etihad Airways network from codeshares and partners in 2016, which Hogan said has helped the partner airlines deliver revenue and synergy benefits.

“Our investments had an immediate impact on the revenue side, delivering hundreds of millions of dollars in additional revenues and allowing us to fill our onward connecting flights,” Hogan said.

“Those benefits have been replicated in all our minority investments – in airberlin, Alitalia, Jet Airways, Virgin Australia, Air Serbia, Air Seychelles and Etihad Regional.”

He said Etihad’s equity investments have allowed the management of the partner airlines to reshape their businesses into sustainable, profitable operations.

While Jet Airways, Air Serbia, Air Seychelles, Virgin Australia and Etihad Regional have all developed into “more efficient and profitable operations”, he admitted that there have been greater challenges with airberlin and with Alitalia.

“Both are operating in very tough competitive environments, and need to address long-standing issues facing their businesses,” he said.

“I believe airberlin’s strategy is now on track and Alitalia is finalising a business plan to address its issues.”

Hogan said Etihad Aviation Group remains committed to its equity partner strategy, which has brought significant return for the UAE’s national carrier.  

“We are committed to our equity partner strategy – it delivers a huge amount to our business,” said Hogan. 

“Some of those [partner] airlines need to react to the market pressures they face, and we are supportive of that process.

“That approach has helped Etihad grow from a $300 million a year airline, to a diversified aviation group which delivers revenues of more than $26 billion. 

“Etihad Airways sits at the heart of that business, of course, but is now only one element of a model which includes significant other businesses and investments.

“That evolution has not happened by accident. Etihad Aviation Group is now a solid, diversified business with strength in depth – and with the scale to shape its destiny in the future.”

For all the latest transport news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.

Subscribe to our Newsletter

Subscribe to Arabian Business' newsletter to receive the latest breaking news and business stories in Dubai,the UAE and the GCC straight to your inbox.