The UAE carrier is facing several challenges but keeps on growing, reports Justin Burns
Emirates Airline has only been synonymous with strong growth over the last two decades but 2018 was a much tougher year for the Dubai-based airline.
The carrier reported in its half-year results in November a profit decline of a sizeable 86 per cent to AED 226 million (US$61 million) despite revenue rising 10 per cent to AED 48.9 billion and warned of a tough second half of the year and will reveal its full-year results in May.
Emirates now ranks in the top 15 airlines around the globe for passengers flown and in the top five for scheduled passenger-kilometres flown and shows no signs of slowing down.
Despite much a tougher financial climate, last year, the carrier flew more than 59 million passengers on over 3,700 passenger flights on average per week, another traffic record and up on the 58.5 million passengers it flew in 2017.
Richard Jewsbury, Divisional Vice President of Emirates UK says it has faced several challenges and continues to face them now. “As we stated in our half year results for 2018-2019, increased oil prices, unfavourable currency movements in certain markets, economic and political uncertainty, are some of the current challenges we are facing,” he says.
“These challenges are not new, and we manage through it by deploying our capacity to best serve customer demand across our network, keeping a close watch on our costs and utilising technology to improve business performance.”
Jewsbury says the strategy is all about meeting the needs and demands of customers. “Our customers are at the heart of everything we do, and our continual investments in the business will be the foundation on which we will build our future growth and continue to deliver solid results.”
Emirates now operates flights from its Dubai hub to passenger destinations across six continents, including 16 freighter-only destinations. In 2018 the airline launched services to Santiago de Chile, London Stansted and Edinburgh.
Jewsbury says demand for the latter is healthy, but it is one of the flights affected during the closure of Dubai International Airport’s Southern Runway for maintenance work from 16 April and 30 May 2019 which will impact a number of scheduled Emirates flights and is set to disrupt operations.
“We started off with a daily service for the first month, and then reduced it to a five times weekly service due to seasonal adjustments and the planned Dubai Airports runway closure for upgrade. From 1 June we’ll resume with a daily service to Edinburgh for the summer,” he says.
“Given the limitations around operating flights using a single runway at its hub, many flights will be cancelled, re-timed or have the operating aircraft changed in order to reduce impact on customers. This will result in a number of Emirates aircraft not being utilised, with a 25% reduction in the overall number of flights operated by the airline during the 45-day period.”
This year will see the network grown further and Emirates has already launched a new four-weekly Boeing 777-300ER service to Portugal’s second largest city Porto from Dubai which it will start on 2 July 2019. This adds to a twice-daily service it already runs to Lisbon.
Sir Tim Clark, President of Emirates, says: “Porto is currently enjoying increased levels of tourism, which is also reflective of the growth in the number of visitors to Portugal as a whole.
“The introduction of this new flight, along with our twice daily Lisbon service, will help meet this growing demand from both leisure and business travellers, as well as provide them with more choice, flexibility and connectivity when travelling to and from Portugal.”
Emirates will also link Phnom Penh and Bangkok with its new 777 daily route set to launch on 1 June, 2019. The carrier has been serving Cambodia with its flights to Phnom Penh since July 2017, carrying over 100,000 passengers on the route to date.
The new service between Dubai and Phnom Penh, via Bangkok, will also complement Emirates’ five direct daily services between Dubai and Bangkok.
Emirates operates an all-widebody fleet of more than 250 aircraft and in December 2018, it celebrated the delivery of the final Boeing 777-300ER aircraft on its order books and has 164 B777 aircraft in its fleet.
The carrier has also made a huge announcement reducing its orderbook of the Airbus A380 aircraft by 39 from 162 to 123 aircraft and which it operates 109 of, more of than any other airline.
The move led Airbus to announce that it was to end production of the world’s largest commercial scheduled aircraft which it will cease deliveries of in 2021.
Emirates will take delivery of 14 further A380s over the next two years including taking delivery of six this year and has also decided to add more Airbus widebody aircraft, ordering 40 A330-900 and 30 A350-900 aircraft.
In 2020, it will also commence taking deliveries of the next generation Boeing 777Xs part of an order of 150 it has with the US aircraft manufacturer.
Emirates is not part of an alliance but instead has a range of codeshare partnerships with airlines around the globe and one which is taking off closer to home is with flydubai.
Jewsbury says the partnership is doing very well since it was launched about 15 months ago and it is set to grow even further this year, as more codeshare destinations are added.
Between January and December 2018, the two airlines jointly carried 3.29 million customers on codeshare flights across 84 destinations. Through the codeshare partnership, Emirates customers can access 67 additional destinations through flydubai’s network, while flydubai customers have 115 additional destinations they can travel to on Emirates network.
“The partnership has also delivered a number of benefits to both airlines’ customers, such as offering greater global connectivity through more destination choices, flexibility with flight options when planning trips, one integrated loyalty programme, and the convenience of travelling on a single ticket with seamless point to point baggage handling,” Jewsbury says.
As for lounges, Emirates recently reopened its lounge at Rome’s Leonardo da Vinci-Fiumicino Airport bring the total it operates to 42 making it one of the largest airline networks of lounges across the world, and Jewsbury says it will continue to open new ones and refurbish others.
The success of airline in future is no doubt linked to investing and embracing in innovation and technology and those that do are likely to come out on top.
Jewsbury says in his view the industry will be focusing on investments in these areas as it seeks to drive efficiency and better customer experiences.
“This is an important area and key focus for us at Emirates as well,” he says. “For example, amongst others, we introduced immersive 3D seat models on emirates.com, making it the first airline in the world to roll out web virtual reality (VR) technology on its digital platform.
“Customers can navigate the award-winning 3D seat map of the interior of the Emirates A380 and the Emirates Boeing 777; explore their seats, the spacious cabin and the Emirates on board product before they select their seats.
“We also unveiled, the world’s first integrated ‘biometric path’ at our hub Dubai International Airport. It’s still currently in trail phase and will offer customers a smooth and seamless journey through the airport with less document checks and less queuing.”
There is no doubt that Emirates will keep on expanding its network and fleet and with one of the strongest airline brands globally, it is sure to be among the most successful in the years ahead.