…
Travel Daily News: What are the main European markets, apart from the Greek, which you are trying to develop fast now?
Keith Longstaff: The European markets are very important to us, but the major market in Europe is no doubt the United Kingdom. We are increasing our services to U.K. from Dubai. We already have 3 flights a day to Gatwick, 3 a day to Heathrow, double daily to Manchester. We are going to increase our daily services to Birmingham. We have one year ago launched a service to Glasgow in Scotland, which is already profitable. And therefore must be again look at the near future to the possibly going double daily. We would like to have more capacity into U.K., but there are slot restrains at Heathrow. So it is a matter of concern and therefore we are looking forward to the introduction of the A-380 aircraft, as soon as it arrives on the route to Heathrow, because it would be more capacity.
TDN: So you have plans to put some of these new aircrafts to European routes
K.L.: Oh, yeah, absolutely. Predominately the A380 solves the problem of slot restrains at airports that have reach their capacity, such as Heathrow. Frankfurt could be another.
TDN: Which are the other European markets that you serve?
K.L.: Germany is the second most important market in Europe. We have double daily to Frankfurt, double daily to Munich. We are going to increase the capacity to Dusseldorf, which also are going to be double daily next year, and in December we are launching a flight to Hamburg, which would be a non-stop fly from Dubai. So, Germany is also a major market. Then, Italy is a very good market. We would like to have flights to Milano and Rome. We have apply for additional services, we would like to fly 14 times a week to Italy ( 7 to Milano and 7 to Rome), but currently we don’ t have the air – political rights to do so. We have just increased our daily Paris flights, by additional 5 flights a week, and by this time next year we would be double daily in Paris again, and of course we fly 3 times a week to Nice. A year ago we started daily services to Vienna, which is doing very well. And of course we have direct flights to Turkey, which are also doing extremely well. We would like to have more destinations in Europe and we are looking very seriously at markets, like Geneva, Dublin. in order to have more points to our network. However, we would restrain the gain, not only by air – political issues, but also by lack of aircrafts. So we have a new aircraft delivery every month for the next seven years, but it is still not enough.
TDN: How about the new European countries Estonia, Lithuanian, Croatian, Serbia, Latvia Poland?
K.L.: All of them are essential markets for us. Especially Serbia. Unfortunately, their national airline is in serious trouble at the moment. We carry a lot of people from Serbia, using our services from Dubai to Australia, for example. Poland is a country with many expatriates, throughout the world, so Poland is another choice. Places like Latvia, Estonia, Lithuanian are booming in terms of economies, and their young governments have the entrepreneurial spirit. All of these countries are key – markets for us, but we need aircrafts.
TDN: How many passengers does Emirates carry today, and what are the potentials of the company in future, referring to European countries?
K.L.: We carried almost 10 millions passengers last year and half of them were from Europe. To give you just an indication, today Dubai’s airport handles over 20 millions passengers a year, we will have about 70 millions going through within the next 4 years. In addition, Jebel Ali airport will be ready late 2006 or early 2007. So, we will have a capacity of 120 million passengers going through Dubai, and hopefully half of them will fly Emirates. So, the market share of Europe is till now about 50%. Our forecast, about that share, is doubling in size every four years now.
TDN: What is the profile of your passengers? How would you describe them?
K.L.: They are very lucky! We take care for everybody. We are one of the few airlines that still have First Class to most of our major destinations. First and Business Class revenue is extremely healthy, very strong. In Economy Class cabin we usually carry holidaymakers, visiting friends and relatives. But, we also carry labor traffic. Dubai being one the most dynamic countries in the world today and the faster in growing places on earth, so we need a lot of labor.
TDN: Dubai is considering as one luxury destination. Could you please describe the destination?
K.L.: It is an international city with all the international benefits and attractions that you would expect from a city of that statue. It is reasonably priced. It is good value for money. I would not say it is cheap any longer, as it is not. But it is good value for money. The hotels are outstanding.
TDN: What are the prospects of outgoing tourism?
K.L.: We are enjoying a very high capital per income in Dubai. The nationals of Dubai are very enthusiastic travelers, and they travel in family groups generally. I believe there is a huge opportunity for countries like Greece to have tourism from Dubai.
TDN: What are your plans for Arabian Travel Market? What are you going to present there?
K.L.: We already have a very large stand and it is the model of A380 aircraft. It is a spectacular stand. The ATM is going from strength to strength. We want to reinforce and support all of our partners in business, (hotels and destinations, we serve) and just prior of ATM we will have a grand event, that takes the form of workshop, in which are going to participate destinations, like Greece, which recently have been introduced into our programme with direct flights.
TDN: Who is the most important competitor to you and what is your strategy?
K.L.: Every airline in the world is a competitor, but the major competitors of us are Singapore Airlines, Cathay Pacific, British Airways, Lufthansa, Air France, and KLM. We are trying to compete in quality and value for money perspective. Our strategy is to be better than now, offering better schedule, competitive pricing, and better services on the aircraft.
TDN: What are your plans for strategic alliances and co-operations?
K.L.: We made a lot of commercial agreements with other airlines, but we have no intention currently to join consortia like Oneworld, Star Alliance, or anything like that. We are proud to manage our business in the way we wish to be.
TDN: What is your policy with travel agents, referring to commissions and how important is the Internet for you, as a new distribution channel?
K.L.: As a policy, Emirates wishes to support the travel agents. While major airlines have reduced dramatically or removed commissions entirely, Emirates continue to pay commissions to agents. The percentage depends on the market. Lots of there markets have zero percentage form other airlines. Our policy is to remain faithful to agents, as they support us in the past. On the other hand, consumer is looking for a choice. He wants the choice of going to a professional travel advisor, paying for advice, so the travel agent would either earn the commission or charge the transaction fee to the customer, or the customer wants to do it on his own, through Internet. We will not disappoint him. We will give him a choice, or to go to the agent and pay some fee or commission or to do it by the home and gain some money.
TDN: Why low cost carriers do not working in Dubai?
K.L.: We do not have a low cost carrier, working to and from Dubai airport, mainly because the issue about capacity at Dubai airport. So, there are slot restrictions for the low cost carriers to operate to and from Dubai. However, just down the road in Sarja, which is only forty minutes away, we have a very successful low cost carrier, called Air Arabia and it works extremely well. It was very popular; in fact the first year of operation it has really made money. They offered more opportunities to fly, more frequently, especially to the labor traffic. There is certainly room in the market for low cost carriers in the market.
Theodore is the Co-Founder and Managing Editor of TravelDailyNews Media Network; his responsibilities include business development and planning for TravelDailyNews long-term opportunities.
