Etihad Airways, the troubled national airline of United Arab Emirates based in Abu Dhabi, has grounded its fleet of five Airbus A330 freighters and has requested pilots to take up to 18 months of unpaid leave.
The airline changed its CEO last year, two of its equity alliance airlines went into bankruptcy (Airberlin and Alitalia) and one of them was liquidated (Airberlin) and the airline is apparently doing a “strategic review”. Bloomberg suggests that Etihad may consider canceling some airplane orders it has placed with Airbus and Boeing.
Here’s an excerpt from Arabian Business (access here):
Etihad Airways has grounded its five Airbus freighters, and is asking its pilots to take unpaid leave as it continues to rethink its strategy, the airline and sources told Reuters on Wednesday.
The state-owned Gulf carrier has been reviewing its business since 2016 after billions of dollars spent buying stakes in other airlines failed to deliver substantial returns. This contributed to a $1.87 billion loss in 2016, its first loss since 2010.
Etihad confirmed to Reuters it has grounded its Airbus freighter fleet, five A330 Freighters, and that it had opted to operate an all-Boeing 777 Freighter fleet. It declined to comment on whether it had offered pilots unpaid leave.
And Here’s from Bloomberg (access here):
Chief Executive Officer Tony Douglas, who took over this month, may also look at canceling some new planes once Etihad completes a wide-ranging strategy review launched after the carrier posted a $1.87 billion loss for 2016. Etihad has outstanding orders for more than 150 aircraft, according its website, including 62 Airbus A350s and 55 Boeing 787 Dreamliners.
Earnings were hurt by a decline in Mideast traffic after lower crude-oil prices limited oil-industry travel. Etihad also made failed investments in Alitalia SpA and Air Berlin Plc, which last year filed for insolvency.
What a mess Etihad finds itself with these non-performing airline investments and wasting billions of dollars in the process in case of Alitalia and Airberlin.
There has been lot of speculation that perhaps there is some sort of closer cooperation or merger between Emirates and Etihad possible if sheikhs can come into an agreement. Doesn’t make sense to have two big hubs so close to each other in Dubai (new DWC) and Abu Dhabi.