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Emirates Airline

Emirates Airline (shortened form: Emirates) (Arabic: طيران الإماراتTayarān al-Imārāt) is a subsidiary of The Emirates Group based in Dubai, United Arab Emirates (UAE). It is the ninth-largest airline in the world in terms of international passengers carried, tenth-largest in terms of scheduled international freight tonne-kilometres flown,

It ranks amongst the top 10 carriers worldwide in terms of revenue, and has become the largest airline in the Middle East in terms of revenue, fleet size, and passengers carried and is the eighth largest airline in Asia, in terms of passengers carried. The airline operates over 2,350 passenger flights per week, to 91 destinations in 55 countries. Cargo activities are undertaken by the Emirates Group's Emirates SkyCargo division. Its main base is Dubai International Airport.

During the 2007/08 financial year, Emirates carried 21.2 million passengers. A total of 1.3 million tonnes of cargo was transported by Emirates Airline and Emirates SkyCargo, the freight subsidiary of The Emirates Group.

Emirates will have 122 Boeing 777s by 2011 making it the single largest aircraft type in fleet, and 58 Airbus A380s by 2012. The airline also hopes to have over 120 Airbus A350's in its fleet by 2018.

Emirate became the second operator of the Airbus A380 when their first aircraft was delivered on 28 July 2008, it is now in operation on the Dubai to New York route.

History

The airline was established on 25 May 1985 by the Dubai government and was supported by the founder of the German airline Germania, Hinrich Bischoff, in its beginning. It started operations with flights to Karachi and Mumbai followed by Delhi in September. Two Airbus A300 and Boeing 737-300 were leased from Pakistan International Airlines (PIA). Subsequently two Boeing 727-200 Advanced were acquired from the UAE's Royal Flight. These aircraft were used until Emirates began taking delivery of a fleet of newly built Airbus A300-600R and Airbus A310-300 wide-body aircraft. The first European destination to be added in July 1987 was London Gatwick and Far Eastern operations commenced to Singapore in June 1990. Emirates acquired a financial stake of 43.6% and a management contract for Air Lanka on 1 April 1998, which subsequently changed its name to SriLankan Airlines. In January 2008, Emirates announced that it will pass the management of SriLankan Airlines to the Sri Lankan government in April 2008. There are no plans to remove or decrease the stake in the airline.

Emirates Airline is wholly owned by the Government of Dubai and has 20,273 employees.

Performance

The airline has recorded a profit every year since its inception, except the second, and growth has never fallen below 20% a year. In its first 11 years, it doubled in size every 3.5 years, and has every four years since. The Emirates Group announced a net profits of Dhs5 billion (US$1.37 billion) for the financial year ended 31 March 2008, a 62% increase over the previous year.

For 2004–05, Emirates paid an increased dividend of Dhs368 million to the government of Dubai, compared to Dhs329 million the year before. In total, the government has received Dhs1.1 billion from Emirates since dividends started being paid in 1999. Having provided an initial start-up capital of US$10m and an additional investment of circa US$80m at the time of the airline's inception, the Dubai government is the sole owner of the company. However, it does not put any new money into it, nor does it interfere with running the airline.

In the financial year 2007/2008, Emirates carried 21.2 million passengers and 1.3 million tonnes of cargo. International Air Transport Association (IATA) statistics indicate that in 2007 Emirates ranked among the top-ten airlines in the world in terms of passengers (17.54 million) carried and kilometers (71.3 million) flown in 2006/2007. In the fiscal year 2007/08, passenger seat factor increased to 79.8 per cent, up 2.6 percentage points from the previous year, led by an increase in traffic by 20.2 per cent. The airline carried 21.2 million passengers in the 2007/08 fiscal year, a 21% rise from the previous year.

Financial Statistics
Year	Total Revenue (AED’000)	Total Expenditure (AED’000)	Operating Profit (AED’000)	Net Profit (AED’000)	Yield (Fils per RTKM)	Unit cost (Fils per ATKM)	Breakeven load factor (%)
2002-2003	9,709,749	8,749,606	1,000,511	906,747	169	111	65.4%
2003-2004	13,286,331	11,602,094	2,618,789	1,573,511	181	107	59.0%
2004-2005	18,130,998	15,628,282	2,652,291	2,407,385	192	111	58.0%
2005-2006	23,050,927	20,489,601	2,652,291	2,474,999	203	122	60.2%
2006-2007	29,839,618	26,675,891	3,338,873	3,096,416	216	129	59.9%
2007-2008	39,467,427	34,392,500	5,180,171	5,020,400	236	148	62.7%

Operating Performance
Year	Traffic	Passenger seat kilometres	Fleet	Average age of fleet (months)	Aircraft departures from Dubai International Airport	Number of employees	Passenger seat factor (%)
2002-2003	8,502,894	31,660,547	46	36	45,452	10,507	76.6%
2003-2004	10,441,345	40,110,375	61	46	58,763	12,804	73.4%
2004-2005	12,528,761	51,398,393	69	55	72,057	15,858	74.6%
2005-2006	14,497,536	62,260,070	85	61	79,937	17,296	75.9%
2006-2007	17,544,140	77,946,590	104	63	92,158	20,273	76.2%
2007-2008	21,229,225	94,345,721	115	67	101,709	23,650	79.8%

Destinations

Emirates flies to 91 destinations in 55 countries on six continents from its primary hub in Dubai. It has a strong presence in the Southeast Asian region, which together, connects Dubai with more international destinations in the region than any other Middle Eastern airline. The airline also flies the Kangaroo Route. Emirates does not offer any domestic service within the United Arab Emirates.

While Emirates does not maintain sizeable hubs elsewhere, it has taken advantage of liberal bilateral aviation agreements between Dubai and Australia, and with Singapore, to offer more onward connections from Sydney and Dubai.

In September 2007, Emirates' chairman, Tim Clark, stated that the airline is considering the Boeing 747-8 to serve South American cities. He also said that Emirates is working on getting new flyover rights over Russia to minimise the length of the flights to North America's West Coast. Cities on the West Coast being looked at for possible expansion include Phoenix, Arizona and Seattle, Washington.

Emirates is also considering launching service to Atlanta, Chicago, Dallas/Ft. Worth and Washington, DC, and plans to begin service to Madrid, Spain in Spring 2009.

The airline had also been planning flights to Durban, South Africa which were expected to start in December 2008. However, this was postponed in June 2008, with the rising cost of fuel being cited as the reason for the cancellation. In addition, flights to Alexandria, Egypt were suspended on 10 September 2008 also due to the record price of airline fuel.

New Destinations from Dubai (Updated 29 June 2008)
Destination	Frequency (per week)	Aircraft	Commencing	References
Los Angeles, United States	7 (daily)	Boeing 777-200LR	26 October 2008	AME Info
San Francisco, United States	7 (daily)	Boeing 777-200LR	15 December 2008	Gulf News

Codeshare agreements

Emirates has codeshare agreements with Continental Airlines, where it codeshares on selected regional routes, in addition to the following airlines:

In March 2008 Emirates ceased its codeshare agreement with SriLankan Airlines.

Fleet

Emirates Airlines operates a full wide-body aircraft fleet from four aircraft families: the Boeing 777, the Airbus A330, the Airbus A340, and the Airbus A380. In keeping with its policy of maintaining a young fleet, which stands at an average of 5.7 years in April 2008, it renews its fleet frequently. In July 2008, Emirates received its first Airbus A380 and in August 2008, it became the second airline to fly the Airbus A380, after Singapore Airlines. The airline will be using the aircraft on daily direct flights to New York (starting 1 August), London Heathrow (starting 1 December), and Sydney/Auckland (both starting on 1 February 2009).

Passenger

The Emirates fleet consists of the following widebody aircraft as of September 2008:

Emirates Airline Fleet
Aircraft	Total	Orders	Options	Passengers (First/Business/Economy)	Haul	Entry into Service
Airbus A330-200	29	0	0	237 (12/42/183) 278 (0/27/251)	Short-medium haul	In service
Airbus A330-300	0	30	0		Medium-long haul	2011
Airbus A340-300	8	0	0	267 (12/42/213)	Long haul	In service
Airbus A340-500	10	0	0	258 (12/42/204)	Ultra long haul	In service
Airbus A350-900 XWB	0	80	20		Short-Medium haul	2014
Airbus A350-1000 XWB	0	20	0		Ultra Long haul	2015
Airbus A380	1	57	0	489 (14/76/399) 517 604	Ultra long haul	In Service
Boeing 777-200	3	0	0	290 (12/42/236) 346 (0/42/304)	Medium-long haul	In service
Boeing 777-200ER	6	0	0	290 (12/42/236)	Medium-long haul	In service
Boeing 777-200LR	6	4	0	266 (8/42/216)	Ultra long haul	In service
Boeing 777-300	12	0	0	364 (12/42/310) 380 (18/42/320) 434 (0/49/385)	Medium-long haul	In service
Boeing 777-300ER	36	35	0	354 (8/42/304) 358 (12/42/304) 364 (12/42/310) 427 (0/42/385)	Medium-ultra long haul	In service

Fleet developments

The airline has ordered 58 Airbus A380 aircraft and is the second airline to receive the aircraft, after Singapore Airlines, the launch customer. 41 passenger A380-800s are to be purchased and two are to be leased from International Lease Finance Corporation (ILFC). After delivery, the airline will be the largest operator of the type.

As of 20 November 2005, Emirates had an order book of $117 billion, comprising 105 firm orders, including 55 Airbus A380s, and 51 Boeing 777 aircraft.

The airline has converted an order for A380F into the passenger version which are due for delivery in 2009. In its place the airline has ordered ten of the recently launched Boeing 747-8 freighters for its SkyCargo subsidiary. Emirates has chosen the Boeing 747-8 "derivative" freighter over the all-new Airbus A380-F for its nose-loading capability, something the rival Airbus freighter is lacking.

Emirates is evaluating the Boeing 747-8 Intercontinental, the yet to be launched passenger version of the Boeing 747-8, especially the "stretched" version now studied by Boeing which would incorporate the same 5.6 m stretch as the freight variant instead of the 3.6 m stretch envisaged for the passenger model. This would bring the 747-8I's capacity 20% closer to the Airbus A380-800's typical three-class 555-seat capacity (470 seats in a three-class-configuration instead of 450).

Emirates is negotiating for up to 20 Boeing 747-8 Intercontinental aircraft, according to Flight International magazine. Emirates SkyCargo already has an order for ten 747-8 freighter aircraft and an option for ten more in a $5.6 billion deal inked September 2007. Emirates is in talks for the 747-8I passenger version, however, as of November 2007, according to an article published in Air Transport World magazine, Boeing stated that it might propose to produce a shrunk version of the 747-8 to allow for more range for service between the North American West coast and Dubai.

On 7 May 2007 Emirates reaffirmed its order for 43 A380s and has committed to another four which brought its order to 47.

On 18 June 2007, during the Paris Air Show, Emirates ordered 8 additional A380s, bringing its total ordered to 55. Emirates, which was deciding between the Boeing 787 and Airbus A350, also stated it would decide on an order worth as much as US$20 billion for mid-sized planes by October 2007, and that the design of the Airbus A350 XWB was closing in on Boeing's 787 Dreamliner.

Clark told media, during a demonstration flight of Emirates' new Boeing 777-200LR Ultra Long Range above Dubai on 7 September 2007, that Emirates is spending $10 to $14 million retrofitting each 777 aircraft.

According to company chairman, Ahmed bin Saeed Al Maktoum, Emirates will increase the fleet to 200 aircraft by 2012 and, by 2020 will have over 450. According to vice-chairman, Maurice Flanagan, they would have 600 aircraft but Dubai Airport would be unable to handle them. For 2008 the company expects to take delivery of 22 aircraft, which will increase the fleet size to 137.

An Airbus A340 has been equipped with a system allowing passengers use of their mobile phones for outgoing calls once the plane has reached cruising height.

Cargo

Awards and accolades

Emirates was named the ninth best airline in the Airline of the Year awards 2007 by Skytrax. Skytrax also named Emirates the Airline of the Year in 2001 and in 2002.

In July 2008 Emirates gained the Worlds Most Hygienic Airline award, presented by Taverner and Co. Runners up were Virgin Atlantic and British Airways. The award was based on swabs presenting the lowest count on pathogens, mould, bacteria and yeast. The award was announced in Flight International Magazine, Farnborough Airshow edition, 14-20 July 2008 - Page 157 - flightglobal.com

Services

Emirates flight catering

Emirates Flight Catering Company has over 4,800 employees and provides in-flight catering and support services for airlines at Dubai International Airport.

A catering facility dedicated to the production of airline meals for Emirates Airlines opened in March 2007. The facility has a capacity of 115,000 meal trays per day.

The company provided 22.3 million airline meals in 2006, and will produce over 24 million meals in 2007. The daily average meal uplift is 115,000.

ICE

Information

Operated by Emirates Airline, ICE is an in-flight entertainment system. Emirates in-flight entertainment system, Information Communication Entertainment (ICE), was introduced in 2002 and is now offered to passengers in all classes with over 1,200 entertainment options. Emirates won the award for best in-flight entertainment in 2006 from Skytrax, for their ICE system. ICE is found in Emirate's Airbus A340-500, and Emirates Boeing 777-300ER and Boeing 777-200/LR fleet. It is also available on selected Boeing 777-300 aircraft that have been retrofitted with flat-beds in First Class, lie-flat seats in Business Class and new generation seats in Economy Class. It will be available on all of the Emirates A380 aircraft.

The system is based on the 3000i system from Panasonic Avionics Corporation. ICE provides passengers with a direct data link to BBC News. ICE is the first IFE system to be connected directly to automatic news updates. This is complemented by ICE's Airshow moving-map software from Rockwell Collins. Along with this software comes exterior cameras located on the aircraft. These cameras can be viewed by any passenger through the IFE system during takeoff and landing.

Emirates was one of the earliest airlines to introduce high-speed, in-flight Internet service by installing the Inmarsat’s satellite system and became the second airline in the world to offer live international television broadcasts using the same system.

Entertainment

ICE allows passengers to choose from a library of movies, audio CDs, and video games. ICE offers over 130 on-demand movie titles and 15 video-on-demand channels, 60 prerecorded television channels, 350 audio channels, and around 50 video-game titles. ICE can also be accessed in 10 languages such as English, French, Spanish, Arabic, Korean, and Japanese. Since 2003, all entertainment options are available on demand to all classes with options to pause, forward, and rewind them.

Communication

ICE also contains a link to an in-flight email server which allows passengers to access, send or receive emails for US $1 per message. ICE also contains a seat-to-seat chat server.

In November 2006 the airline signed a deal with mobile communications firm AeroMobile to allow in-flight use of mobile phones to call or text people on the ground, on selected 777s. The service was first introduced on a commercial service between Dubai and Casablanca on 20 March 2008.

In mid-2007, Emirates will feature docking capability for Apple Inc.'s iPod portable music and video player. This will allow the device's battery to be charged, but will also allow integration with Emirates' in-flight entertainment (IFE) system. This will also enable the IFE system to play music, television shows, or movies stored on the iPod, as well as function as a control system.

Newspapers and magazines

Newspapers and magazines are available to all first and business class passengers on Emirates flights. Free newspapers are also provided to all economy class passengers. The Emirates in-flight magazine, Openskies, is provided to all passengers on all flights.

Frequent flyer programme

Skywards is the frequent flyer program of Emirates, and other Emirates travel partners. Miles are earned through flights with Emirates, or with cooperating airlines such as Continental Airlines, Japan Airlines, Kingfisher Airlines, Korean Air, South African Airways, and United Airlines. Skywards offers status tiers Silver and Gold, which give additional benefits based upon miles flown in a year.

Emirates lounges

First and business class passengers, as well as Skywards Gold and Silver members, have access to Emirates Lounges. In addition to the Emirates Lounge, Emirates passengers are able to use the Department of Civil Aviation's (DCA) First Class lounge in Dubai. The airline has 33 lounges in 16 cities, with plans for 13 more. It also has affiliation with 53 other lounges.

Cabin

First Class

First class passengers have a full suite, complete with closing doors to ensure privacy, a mini-bar, a coat rack and storage. They also feature the ICE system and a 23" LCD screen. The seat converts into a 2 metre (6 foot 7 inch) fully-flat bed. Private suites are being introduced on the latest B777-300ER/ULRs and B777-200LRs and are already installed on all of Emirates 10 Airbus A340-500 aircraft. The suites are available on the Perth, Sydney, Melbourne, Auckland, Christchurch, Johannesburg, New York JFK, Zurich, Osaka, Mumbai, Houston, Los Angeles, San Francisco, Toronto and São Paulo routes.

The older Boeing 777-300ERs, Boeing 777-200s and Selected Boeing 777-300s feature flat bed luxury with integrated passenger seat control, along with the ICE system and a 19" screen.

On its newly delivered A380, First Class features private suites, two shower-equipped lavatories, and access to the first/business class bar area.

Business Class

In business class, the following features are included on Boeing 777-200LRs, selected Boeing 777-300ER/ULRs and selected Boeing 777-300s:

Airline seats with a 60" pitch that recline to angled lie-flat beds which are 78" long, with ample room for taller passengers on the newer planes
Electrically operated massage, privacy partition, backrest recline, seat pan extension, footrest extension, leg rest extension and lumbar support.
Adjustable winged headrest with six-way movement.
Two individual reading lights and one overhead light in each seat.
In-seat power supply and over 600 channels of entertainment on ICE, showed on a 17" wide TV screen.

On the A340-500s, passengers can relax in deeply reclining sleeper seats which have a 60" pitch and are 18" wide. All A340-500 aircraft feature the ICE system in all three classes. The Boeing 777-200s and non-retrofitted Boeing 777-300/ER/ULRs have deeply reclining seats which are almost lie-flat. They have a 46" pitch and are 20.5" wide. The Boeing 777-200s also feature the ICE system.

On Airbus A330 aircraft and A340-300s, the seats are standard business class recliners and feature a leg rest and seat back screens. These business class seats are smaller than other business class seats in the Emirates fleet as these aircraft are used predominantly on short-medium haul routes.

On their newly delivered Airbus A380 aircraft, the seats recline to form a fully-flat bed and are equipped with personal minibars. Business Class passengers also have access to an on-board bar at the rear of the aircraft.

Economy class

The seat has a seat pitch of 34 in (86 cm) (Boeing 777-200/300, Airbus A340-500 & some Airbus A340-300) or 32 in (81 cm) (Airbus A330-200 and other non retrofitted aircraft) and a width of 17 in (43 cm) (Boeing 777 and Airbus A340) or 18 in (46 cm) (Airbus A330 and certain aircraft) as well as a 150° seat recline. Like standard economy class seats, adjustable headrests are available on every seat. On the Airbus A340-500, B777-200/LR, B777-300ER and certain B777-300 and A340-300 aircraft there is a 10.6 in (25 cm) screen, and 16.5 cm (6.5 inches) on Airbus A330-200, certain Airbus A340-300 and older Boeing 777-300 aircraft that have not been retrofitted with the new cabins, for in-flight entertainment. The A340-500, B777-200LR and 777-300ERs also feature an in-seat power outlet and ICE Inflight Entertainment.

Business model

Emirates business model has led to their commercial success in the aviation industry. The airline has a lean workforce which can be compared to low-cost carriers rather than traditional flag carriers. It has a simple organisational structure, that allows the airline to maintain low overhead costs and it must pay no income taxes on wages. Due to the low operating costs at its Dubai base, some industry analysts believe the airline is second only to Ryanair on a cash cost per seat basis. Therefore, the airline is able to serve secondary destinations as well as connecting to places via their hub in Dubai.

The airline has not joined any major global airline alliances. The airline operates only wide-body aircraft which results in lower unit costs compared to other major airlines operating a mixture of narrow and wide-body aircraft. It allows Emirates to use the aircraft's cargo capacity to increase its revenues and total profits. Since Dubai International Airport does not have any flying restrictions at night, the airline is able to highly utilise their aircraft. The airline virtually does not have any legacy costs compared to other airlines. It also helps that all forms of strikes are banned in the UAE (except for construction related strikes).

Employment

Emirates, which hopes to take delivery of 58 Airbus A380 has invested Dh73 million ($20 million) to expand its crew training facility at the Emirates Training Center. To serve its expanding operations the airline has been hiring new cabin crew at a rate of 60 per week, due to rise to 100 per week as larger aircraft, especially the A380s, join the fleet. By 2011, Emirates expects to have more than 17,000 cabin crew on its payroll.

Rivalry

The established network carriers in Europe and Australia, i.e. Air France-KLM, British Airways, Lufthansa, and Qantas, perceive Emirates' strategic decision to reposition itself as a global carrier as a major threat because it increasingly enables an ever-growing number of air travellers to by-pass traditional airline hubs such as London Heathrow Airport, Paris-Charles de Gaulle Airport, and Frankfurt Airport on their way between Europe/North America and Asia/Australia by changing flights in Dubai instead. These carriers also find it difficult to deal with the growing competitive threat Emirates poses to their business because of their much higher cost base.

Some of these carriers—notably Air France and Qantas—are so concerned about the detrimental effects of Emirates' growth on their future ability to compete with it on a level playing field that they have resorted to openly accusing their Dubai-based rival of receiving hidden state subsidies and of maintaining too cosy a relationship with Dubai's airport authority as well as its aviation authority, both of which are also wholly state-owned entities that share the same government owner with the airline. In addition, they have also accused Emirates of taking unfair advantage of its government shareholder's sovereign borrower status. They claim that this masks its true financial performance and reduces its borrowing costs below market rates.

Marketing and sponsorships

Emirates is a sponsor of sports clubs and events, both at its home base and in its overseas markets. It also sponsors the annual Dubai Shopping Festival, the Dubai Summer Surprises and the West Australian Symphony Orchestra. For Emirates, marketing expenses account for a far greater share of its total costs than for most of its competitors. In the English-speaking world the sponsorship always carries the words "Fly Emirates". Emirates sponsors Arsenal Football Club and their 60,000 seater Emirates Stadium as well as Hamburger SV, Paris Saint-Germain, Western Force and the Collingwood Football Club. Emirates also co-funded construction of The Sevens, a stadium in Dubai purpose-built for the 2009 Rugby World Cup Sevens, with the Dubai government.

Notes

A. Emirates Airline was due transfer all operations to Terminal 3 in August 2008 but this has been delayed to autumn 2008.

B. The number of destinations does not include cargo destinations.

References

The Economist, 2005/6. The Economist Newspaper Ltd. (The Economist online)
Financial Times, 29 October 2005. UK Edition. (Financial Times online)
Financial Times, 19 July 2006. UK Edition. (Financial Times online)
The Sunday Times, 23 July 2006. Times Newspapers Ltd. (The Sunday Times online)
Flight International, 25-31 July 2006. Reed Business Information Ltd.. (Flight International online)
Recipient of $500,000,000 USD grants by US government in 2008. Why?. .