In March Etihad reported their awful financial results from last year, as the airline lost $1.28 billion, bringing their losses over the past three years to nearly $5 billion. The worst part is that this came after Etihad already engaged in a significant cost cutting program, which shows you just how much work they have…
Continue reading: Emirates Reports $237 Million Profit (Down 69%)
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I appreciate the detailed analysis, and I also agree to most if not all of it. Emirates is legitimately profitable. When we assume that these airlines are state owned, many are wrongfully assuming. Emirates and Etihad are not owned by the national government but each by its respective Emirate, Etihad by Abu Dhabi and Emirates by Dubai. Why this aspect is relevant? Because Dubai can't possibly be willing to subsidize an airline of such size since it is no longer (since decades) depending on oil. Can't judge the other Gulf airlines but definitely I have my opinion about Emirates as I live in Dubai since 15 year. Emirates is probably one of the best managed airline in the world, given that its revenue is made mostly overseas and not from domestic operations. The model works, however works less for us residents. Often I have to opt for stopovers as direct flights are too expensive for premium cabins. Still I flew with Emirates a week and a half back back from US and the service it's the top of the notch.
Emirates increased their fleet by a net of two planes, as they took delivery of 13 planes (seven A380s and six 777-300ERs) and retired 11 planes"
Thats why their numbers are down this year.
It seems disingenuous to factor currency fluctuations into profit/loss statements as that artificially inflates the number whether black or red. Not being a financial guru beyond balancing my own checking account, I'd be curious to know how this truly impacts an airline as it looks like it's "fake" money.
Just goes to show what a difficult industry this is. Their profit was less than the list price of a 777-300ER...
I do wonder how much it costs for the daily holding at DXB for landing and whether the costs of holding compared with let's say a hi speed rail link to DWC.
I think there are merits in using both airports to reduce fuel costs. Considering walking end to end at DXB can take 25-40 mins I think a high speed rail link would be 10mins end to end.
Love Emirates but hate the holding on arrival.
There is hardly any holding on arrival since the airspace was restructured several years ago. Very rare to get more than 1 hold nowadays.
Whilst you may get caught anecdotally in a longer hold, the average is really quite low.
In any case, there is 99% chance of a 5 min shortcut on the STAR.
EK has a very different cost base. Aircraft cleaners, gate agents, mechanics cost a fraction of the legacy airlines. And they enjoy massive economies of scale at DXB.
It is actually correct to factor in currency exchange. Nothing fake here. Imagine later in 2019 The GBP crashed due to brexit and 1 GBP is now only 0.13 USD. That means all the tickets sold in GBP just became 10% of what it used to be. Now gain/loss on exchange can affect the valuation but it is nothing EK can manipulate, better yet if EK are good at FOREX hedging, they could even make money from it. Now when they say EK is free from subsidy, you need to look closer at there wage bill, cost of fuel, and interest rates. That is where the subsidy goes hidden. Government can't just write checks just because.
"Etihad because they're a basket case" was a rather rude remark but surely it should be more accurately presented as "Etihad, like Gulf Air, because they placed grossly misguided trust in James Hogan".
Turkish Airlines will put all three in bankruptcy within 3 years. New airport, huge currency advantage, better location are all insurmountable advantages.
Your sense of humor is outstanding
Etihad is owned by the largest sovereign fund in the entire planet. Emirates is probably the or one of the best managed airlines in the world. Qatar is no much different than Etihad in terms of resources. If they wish they can sustain losses for the next hundreds years (but they won’t need to).
Today Emirates is the largest airline for international routes and I don’t see this changing any time soon. Turkish is an outstanding airline and there’s little doubts about that.
Causing bankruptcy? Really? On which assumption? Because of the new airport?