Financial Times yesterday run an interesting story about the current state of the Emirates and what pains the airline is currently going trough.
The forward looking booking for the summer are soft, the airline doesn’t appears to have plan for the frames it took off from the US market, and there might be a merger in the making with the FlyDubai.
Here’s an excerpt from the Financial Times (access the article here):
An internal memo to staff seen by the FT highlights these realities and the predicament that the group is in. “Particularly worrying are the airline’s forward bookings, even during the summer,” management told staff. “Make no mistake: we’re going through an extremely difficult period.”
“We have started the unbundling and that’s been fairly successful. I think we’ll probably do more of that. We will do seats with extra baggage, whatever it may be,” says Sir Tim.
“This was a huge market for us. I’ve got 50 aircraft on the US operations, and I’m having to take 20 per cent out almost immediately as the markets diminished,” says Sir Tim.
He notes that the airline is already struggling to find homes for the 13 aircraft that it has taken out of the US market. “Finding homes for all of those has not been easy, and I will be frank and say that if we do not find homes for them, we’ll put them on the ground,” says Sir Tim.
While rumours swirl about an Emirates merger with Abu Dhabi’s Etihad, a more realistic prospect is a tie-up with low-cost carrier Flydubai, which is also state-owned and mainly operates smaller aircraft on an extensive regional network.
If you cannot access the Financial Times article using the link above, you can always go to new.google.com and just use the title above as the search term. You should then be able to access the entire article free.
Both Qatar Airways and Etihad have narrow body fleet to serve destinations where widebody would be an overkill. They also use these smaller planes to open markets and later upgrade to larger frames. Let’s see if something comes out of this rumored closer co-operation or merger between Emirates and FlyDubai.
Seems that Emirates is truly hurting because of the laptop ban and Trump travel slump affecting the travel to/from the United States that feeds other flights as well.
Not sure if they have many markets that are still under or non-served where they could deploy their current excess capacity. Perhaps lowering fares could help to stimulate demand?