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Three Gulf airlines forge global ties
DUBAI, United Arab Emirates — During a demonstration flight of Boeing’s new 787 high above the United Arab Emirates this summer, one of the plane maker’s representatives jokingly asked an Etihad Airways executive what was next on the airline’s shopping list.
It wasn’t planes he was talking about, but chunks of other airlines. Abu Dhabi-based Etihad has snapped up stakes in four different carriers just since December, prompting speculation in aviation circles of more deals to come.
Etihad is not alone. The Gulf’s three big airlines are all increasingly forging cross-border partnerships to extend their reach deeper into international markets. They are doing so even as they rapidly grow their own route networks and expand their fleets with billions of dollars’ worth of new fuel-efficient planes.
Etihad and Aer Lingus announced a codeshare deal Monday designed to feed traffic into one another’s networks, just months after Etihad bought a slice of the Irish carrier. Australia’s Qantas says it is in talks with Dubai-based Emirates about potential alliances.
While their strategies differ, the airlines’ push is likely to further strengthen their increasingly formidable Gulf hubs at a time when older airlines from the United States to Australia are struggling to stay competitive.
All three Gulf carriers woo economy-class transit passengers with generous hot meals and a wide range of back-of-seat entertainment options that would be the envy of most domestic American airlines. In the battle for lucrative business and first-class fliers, they try to outdo one another with offerings that include plush private cabins, gourmet chefs and even onboard showers.
“It’s all about feed. These guys have these tremendous emerging hub-and-spoke networks. The more feed you can get with partners or by yourselves, the more effective your network becomes over those hubs,” said Russell Shaw, a transportation and aviation analyst at Australia’s Macquarie Group.
The Mideast’s biggest airline, Emirates, has traditionally focused on growing its network in-house. It has shown little interest in joining any of the big airline alliances such as Oneworld or Skyteam that dominate intercontinental air travel.
That has not stopped it from seeking out bilateral partnerships with individual airlines that can expand its network and route more traffic through its Dubai hub. In April, it sealed a deal with JetBlue Airways that tacks an Emirates flight number onto a dozen routes operated by the New York-based airline.
Although such codeshare deals have been around in the industry for years, it is Emirates‘ first with an American carrier. The airlines began allowing passengers to earn miles on each other’s frequent-flier plans beginning last month.
More deals could be on the way.
“We routinely look at ways we can work with other airlines in order to offer customers the most convenient and seamless service possible,” Emirates said in a written statement responding to questions about codeshares this week.
One potential partner is Qantas. The Australian flag carrier disclosed Thursday that it is in talks with airlines including Emirates about setting up some sort of alliance. The news sent its shares soaring. Emirates has declined to comment.
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