Emirates chief urges rival Gulf airlines to collaborate

16 November 2007

Dubai flag carrier Emirates is calling for greater collaboration between the region’s three major airlines, in a push to liberalise Gulf air space. The carrier is also pursuing greater co-operation with Abu Dhabi rival Etihad Airways to cut operating costs.

Speaking to MEED at the 10th Dubai Airshow in mid-November, Tim Clark, president of Emirates, said there were clear areas for potential collaboration between the region’s big three airlines: Emirates, Etihad and Qatar Airways.

With Emirates and Qatar Airways announcing aircraft orders worth a combined total of $48bn at the show, Clark said these companies, along with Etihad, could use their leverage within the region to unite the Gulf’s fragmented airspace under one flight information region (FIR).

“We might be able to use the pressure of the national carriers to come together to form one FIR, with one aerospace control centre doing the job for us so we can all grow our business irrespective of competitive forces,” Clark added.

“There are common areas such as air space management within these very cluttered skies, where we could sort out something that the Europeans have been trying to do for a long time, and get this mosaic of FIRs sorted out.”

Clark said the UAE government was keen to see closer co-operation between Emirates and Etihad. Commercial synergies could be found in IT and data sharing, he added, without either business compromising its competitiveness within the Gulf or internationally.

“When two carriers owned by the UAE government are operating in the same theatre, and both are building fleets, you can see where there will be procurement synergies, supply chain synergies and a certain number of commercial synergies,” said Clark.

“This is driven more by what is going on in the UAE - both Dubai and, more recently, Abu Dhabi - where you have hundreds of billions of dollars of investment going in.

“It makes sense that in areas that do not conflict for reasons of competitive pressures or brand mix-up, perhaps we could do something together. I think it is something that would be looked upon favourably by the government if we were to find common ground and work together.”

Discussions between the two UAE carriers on some level of collaboration have been under way since the summer (MEED 29:6:07). When MEED drew attention to this earlier this year, it sparked a flurry of speculation about a potential merger between the two Gulf giants.

“It is not like that at all,” said Clark. “It just makes sense bearing in mind that with this whole country getting closer, all the component parts in the federation act as one solid, single unit.”

Etihad and Qatar Airways were unavailable for comment.

CarrierNo. planesTypeValue ($bn)
Emirates Airline143120 Airbus A350s; 11 A380s; 12 Boeing 777-300s34.6
Qatar Airways3530 Boeing 787-8; 5 Boeing 77713.5
Saudi Arabian Airlines2222 Airbus A320s1.6
Yemenia1010 Airbus A350s2.0
Oman Air53 Airbus A330-300s; 2 Airbus 330-200s0.9
Source: MEED

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