Emirates airline has reported a 75 percent drop in net profit in the first half of the 2016-17 financial year – attributed to economic uncertainty and subdued travel demand.
The airline’s net profit was AED786 million ($214 million), down 75 percent from the same period last year, when Emirates reported one of its best half-year performances.

"However, fuel remained the largest component of the airline’s cost, accounting for 24 percent of operating costs compared with 28 percent in the first six months of last year, Emirates said."

Meanwhile, overall capacity during the first six months of the year rose by 9 percent to 30.2 billion available tonne kilometres (ATKM).
Capacity measured in available seat kilometres (ASKM) grew by 12 percent while passenger traffic measured in revenue passenger kilometres (RPKM) was up 8 percent, with average Passenger Seat Factor dropping to 75.3 percent, compared with 78.3 percent last year.
Emirates also reported a 9 percent increase in passengers compared to last year, up to 28 million passengers between 1 April and 30 September. The volume of cargo remained stable at 1.3 million tonnes, it said.

The company added that it continues to invest in wide-body aircraft to improve efficiency – during the first six months of the financial year, Emirates received 16 wide-body aircraft (8 Airbus A380s, and 8 Boeing 777s) and 20 more are scheduled for delivery before the end of the financial year. The airline retired 19 older aircraft from its fleet with a further eight to be returned by March 31 2017.

Source: http://www.arabianbusiness.com/emirates ... 52179.html

dubaiamman243 wrote:

The company added that it continues to invest in wide-body aircraft to improve efficiency...

Source: http://www.arabianbusiness.com/emirates ... 52179.html

Funny statement, they never invested in anything else but widebody aircraft....

I learned today that you can get very very far with populistic statements. So here is mine, to complete this thread quickly:
- it's all about EK's A380
- they will get rid of them quickly and replace them with 777-whatsoever

Problem solved.

I'm looking forward to see Christoph Müllers impact on EK. Interesting times ahead (for EK) ...

The subsidies are drying out.
The decreasing profit PR is in my opinion just an introductory statement to a long line of route cuts to come.
Without subsidies, they can't grow, and the only way to make this look good is to issue deteriorating financials, before starting to announce the cuts.

Unfortunately, the new US administration will be very protectionist and will make any further growth very difficutl for EK and its sibblings. EK has gotten far enough, now they need to turn it into a sustainable business, like everybody else.

Waterbomber wrote:

The subsidies are drying out.

Oh, I forgot this one in my second reply.

Waterbomber wrote:

The subsidies are drying out.
The decreasing profit PR is in my opinion just an introductory statement to a long line of route cuts to come.
Without subsidies, they can't grow, and the only way to make this look good is to issue deteriorating financials, before starting to announce the cuts.

Unfortunately, the new US administration will be very protectionist and will make any further growth very difficutl for EK and its sibblings. EK has gotten far enough, now they need to turn it into a sustainable business, like everybody else.

EK is the pillar of Dubais economy and there are 3 more airlines in the region which a similar business model. It will be interesting to see how they change their business model....

N14AZ wrote:

I learned today that you can get very very far with populistic statements. So here is mine, to complete this thread quickly:
- it's all about EK's A380
- they will get rid of them quickly and replace them with 777-whatsoever

Problem solved.

Wrong, scrap all the tractors, get 200 more A380's and the future is bright

N14AZ wrote:

dubaiamman243 wrote:

The company added that it continues to invest in wide-body aircraft to improve efficiency...

Source: http://www.arabianbusiness.com/emirates ... 52179.html

Funny statement, they never invested in anything else but widebody aircraft....

Oddly enough, Emirates did start out with some single-aisle or narrowbody aircraft. In 1985 it obtained two Boeing 727-200/Advs from the Dubai Airwing Fleet and it leased a 737-300 from Pakistan International Airlines. The 737-300 was returned to PIA in 1987 but the 727s remained with EK until 1995. They've come a long way since.

KruegerFlaps wrote:

N14AZ wrote:

dubaiamman243 wrote:

The company added that it continues to invest in wide-body aircraft to improve efficiency...

Source: http://www.arabianbusiness.com/emirates ... 52179.html

Funny statement, they never invested in anything else but widebody aircraft....

Oddly enough, Emirates did start out with some single-aisle or narrowbody aircraft. In 1985 it obtained two Boeing 727-200/Advs from the Dubai Airwing Fleet and it leased a 737-300 from Pakistan International Airlines. The 737-300 was returned to PIA in 1987 but the 727s remained with EK until 1995. They've come a long way since.

I know this. But I really wouldn't say EK "invested" in them. As you correctly wrote, they obtained the 727 and they leased the 737.

Waterbomber wrote:

The subsidies are drying out.
The decreasing profit PR is in my opinion just an introductory statement to a long line of route cuts to come.
Without subsidies, they can't grow, and the only way to make this look good is to issue deteriorating financials, before starting to announce the cuts.

Unfortunately, the new US administration will be very protectionist and will make any further growth very difficutl for EK and its sibblings. EK has gotten far enough, now they need to turn it into a sustainable business, like everybody else.

Oh gosh, really? Are some still on this train? EK is probably one of the best run companies in the world.

I mean no disrespect to Waterbomber but this has just got to stop. It takes away from a healthy discussion of ACTUAL reasons behind this news.

Did Air India impact Emirates profits? AI's load factors have improved considerably on all intl routes, in the mean time. Obviously, passenger demand didn't slow down in 1 year. Other airlines ate that demand.

MoKa777 wrote:

Waterbomber wrote:

The subsidies are drying out.
The decreasing profit PR is in my opinion just an introductory statement to a long line of route cuts to come.
Without subsidies, they can't grow, and the only way to make this look good is to issue deteriorating financials, before starting to announce the cuts.

Unfortunately, the new US administration will be very protectionist and will make any further growth very difficutl for EK and its sibblings. EK has gotten far enough, now they need to turn it into a sustainable business, like everybody else.

Oh gosh, really? Are some still on this train? EK is probably one of the best run companies in the world.

I mean no disrespect to Waterbomber but this has just got to stop. It takes away from a healthy discussion of ACTUAL reasons behind this news.

That statement is just a continuation of the trolling that started in another thread about oil prices impacting the ME3.

Ro

Not a populist opinion, but I will say anyway. EK's business model have several flaws. Of course it a numbers company, which numbers is the multi $$B question.

1) Only LAs and VLAs - A380/B77W and future B779/B778, No flexibility in fleet plan. This is a Titanic steaming full speed ahead towards iceberg scenario, no real fix other than to retire old frames rapidly.
2) Bloated non-frontline workforce. EK has 55,000 for 240 planes. 229 per plane. Yet there is pilot shortage, just 4000 pilots. Emirates group has 95,000.
3) Spending too much on publicity. $3B is too much on brand building for any size airline.
4) Too much publicity on low seat costs while ignoring trip cost. If I recall correctly fleet wide load factors are in 70% range.
5) Extreme case of Peter's principle. Keep up-guaging every route until it has bad load factors.
6) Yields are not good either, particularly premium cabin yields.
7) No consistent hard product, too much publicity on A380. Eg., B77L starter to B77W LA to A380 VLA (the best). Lets say LF is 75%. No clue what to do at this point about second frequency. Should they deploy B77W (inferior product in its own words) and every one trying to get on to the first A380 or second A380 and bring LF to 35%.
8) I think Tim Clark likes A380s because he thinks pilots cannot quit easily because they don't have many other options.. Nothing more.

dubaiamman243 wrote:

attributed to economic uncertainty and subdued travel demand.

The others are catching up, hence the subdued travel demand for EK. Also, increasing capacity 10% year over year will eventually catch up to you.

dtw2hyd wrote:

Not a populist opinion, but I will say anyway. EK's business model have several flaws. Of course it a numbers company, which numbers is the multi $$B question.

1) Only LAs and VLAs - A380/B77W and future B779/B778, No flexibility in fleet plan. This is a Titanic steaming full speed ahead towards iceberg scenario, no real fix other than to retire old frames rapidly.
2) Bloated non-frontline workforce. EK has 55,000 for 240 planes. 229 per plane. Yet there is pilot shortage, just 4000 pilots. Emirates group has 95,000.
3) Spending too much on publicity. $3B is too much on brand building for any size airline.
4) Too much publicity on low seat costs while ignoring trip cost. If I recall correctly fleet wide load factors are in 70% range.
5) Extreme case of Peter's principle. Keep up-guaging every route until it has bad load factors.
6) Yields are not good either, particularly premium cabin yields.
7) No consistent hard product, too much publicity on A380. Eg., B77L starter to B77W LA to A380 VLA (the best). Lets say LF is 75%. No clue what to do at this point about second frequency. Should they deploy B77W (inferior product in its own words) and every one trying to get on to the first A380 or second A380 and bring LF to 35%.
8) I think Tim Clark likes A380s because he thinks pilots cannot quit easily because they don't have many other options.. Nothing more.

The others are catching up, hence the subdued travel demand for EK. Also, increasing capacity 10% year over year will eventually catch up to you.

Some very good points...

airbazar wrote:

dubaiamman243 wrote:

attributed to economic uncertainty and subdued travel demand.

The others are catching up, hence the subdued travel demand for EK. Also, increasing capacity 10% year over year will eventually catch up to you.

This is incorrect, the UAE and GCC countries would be some of the biggest markets for EK. Oil drives most of these economies, with reduced oil prices...there is significantly softer demand in the travel market as a result of job or salary cuts in the oil and banking sector and by extension the other sectors as this is a major driver for spending...thus, less disposable income. When there is less disposable income, travel is one of the first luxuries to be reduced to essentials.

This isn't affecting just EK or the ME3.

Waterbomber wrote:

Unfortunately, the new US administration will be very protectionist and will make any further growth very difficutl for EK and its sibblings.

We don't really know whether that's true or not given how Trump goes back and forth on the issue.

N14AZ wrote:

I learned today that you can get very very far with populistic statements. So here is mine, to complete this thread quickly:
- it's all about EK's A380
- they will get rid of them quickly and replace them with 777-whatsoever

Problem solved.

Yes, getting rid of A380s is an essential part of making Emirates great again.

That and building a wall around DXB (and making QR pay for it). -ir

Emirates is good at a lot of things but capacity discipline is not one of them. When are they going to learn you need an aircraft smaller than a 77W? I know they have the 77L, but that fleet isn't large enough to generate economies of scale.

Wonder if this news means the B78J / A35J order will get postponed yet again?

MoKa777 wrote:

Waterbomber wrote:

The subsidies are drying out.
The decreasing profit PR is in my opinion just an introductory statement to a long line of route cuts to come.
Without subsidies, they can't grow, and the only way to make this look good is to issue deteriorating financials, before starting to announce the cuts.

Unfortunately, the new US administration will be very protectionist and will make any further growth very difficutl for EK and its sibblings. EK has gotten far enough, now they need to turn it into a sustainable business, like everybody else.

Oh gosh, really? Are some still on this train? EK is probably one of the best run companies in the world.

I mean no disrespect to Waterbomber but this has just got to stop. It takes away from a healthy discussion of ACTUAL reasons behind this news.

I know what I'm talking about, but you don't seem to have the slightest clue. There is a direct correlation between continued lower oil pices and EK's inability to grow. One of them has been mentionned above, ie less oil traffic. But that's not the main link and to understand the main link, you have to understand how countries work, how and why they pursue foreign currency reserve, and how airlines fit into that strategy.
3 more years of low oil prices and John Leahy can throw away the A380 brochures and Boeing can hold firesales on new B777X's, none of the ME3 will be able to take their orders.

RohanDXB wrote:

MoKa777 wrote:

.

Waterbomber wrote:

The subsidies are drying out.
The decreasing profit PR is in my opinion just an introductory statement to a long line of route cuts to come.
Without subsidies, they can't grow, and the only way to make this look good is to issue deteriorating financials, before starting to announce the cuts.

Unfortunately, the new US administration will be very protectionist and will make any further growth very difficutl for EK and its sibblings. EK has gotten far enough, now they need to turn it into a sustainable business, like everybody else.

Oh gosh, really? Are some still on this train? EK is probably one of the best run companies in the world.

I mean no disrespect to Waterbomber but this has just got to stop. It takes away from a healthy discussion of ACTUAL reasons behind this news.

That statement is just a continuation of the trolling that started in another thread about oil prices impacting the ME3.

Today there are 3 EK related threads open on the civil aviation forum's first page.
Guessing by your username RohanDXB you belong to their marketing machine which is obvously turning at full swing.
To call my postings trolling is irony at its best.

To confirm Waterbomber's statement of 3 EK threads on this forum, it is all getting a bit Kim Kardashian. EK threads in your face if you like it or not. What about airlines like Etihad much better than EK overall?

There are others carriers in the region and my own shift has been EK to EY to TK. With more and more airlines flying point A to B and not having to go via C in this case DXB, it won't be long before passengers will be bypassing Dubai.

787s and A350s are opening more point to point routes. Soon Australia to London no longer be a thing of the past.

MoKa777 wrote:

Waterbomber wrote:

The subsidies are drying out.
The decreasing profit PR is in my opinion just an introductory statement to a long line of route cuts to come.
Without subsidies, they can't grow, and the only way to make this look good is to issue deteriorating financials, before starting to announce the cuts.

Unfortunately, the new US administration will be very protectionist and will make any further growth very difficutl for EK and its sibblings. EK has gotten far enough, now they need to turn it into a sustainable business, like everybody else.

Oh gosh, really? Are some still on this train? EK is probably one of the best run companies in the world.

I mean no disrespect to Waterbomber but this has just got to stop. It takes away from a healthy discussion of ACTUAL reasons behind this news.

EK has some of the worst margins in the world. I don't think that falls in the "best run" basket.

Does the margin REALLY mean that much? They have decided to develop a network and accepting smaller profits than play chicken like the 3 major US airlines at the 1st sign of competition and withdraw or make seasonal their routes.

David_itl wrote:

Does the margin REALLY mean that much? They have decided to develop a network and accepting smaller profits than play chicken like the 3 major US airlines at the 1st sign of competition and withdraw or make seasonal their routes.

Would you invest in a cool flashy airline from a mysterious part of the world, or invest in an airline making consecutive billion dollar profits in a stable part of the world?

David_itl wrote:

Does the margin REALLY mean that much?

YES ! If you want profits, margins are not the most important thing, they are the only thing.
Of course, if you want to be popular, just being a good ambassador for your country, it is different. But this attitude will bring you down sooner or later.

And the business case of the ME3 has one major flaw, that will become fatal sooner or later: They do not have a home market and depend on connecting traffic.
Remember Shannon or Gander, anyone ? Or Keflavik (without fish )?

lancelot07 wrote:

David_itl wrote:

Does the margin REALLY mean that much?

YES ! If you want profits, margins are not the most important thing, they are the only thing.
Of course, if you want to be popular, just being a good ambassador for your country, it is different. But this attitude will bring you down sooner or later.

And the business case of the ME3 has one major flaw, that will become fatal sooner or later: They do not have a home market and depend on connecting traffic.
Remember Shannon or Gander, anyone ? Or Keflavik (without fish )?

But that is what Dubai is living on. Tourists, trade, banking, shipping etc. Oil and gas is less than 5 % of the economy. And Emirates is bringing those people to Dubai. The airport is living of shopping being a huge mall. All Dubai is a huge mall. As long as Emirates is run at a profit, not a loss, I do not see a lot of trouble.

dtw2hyd wrote:

Not a populist opinion, but I will say anyway. EK's business model have several flaws. Of course it a numbers company, which numbers is the multi $$B question.

1) Only LAs and VLAs - A380/B77W and future B779/B778, No flexibility in fleet plan. This is a Titanic steaming full speed ahead towards iceberg scenario, no real fix other than to retire old frames rapidly.
2) Bloated non-frontline workforce. EK has 55,000 for 240 planes. 229 per plane. Yet there is pilot shortage, just 4000 pilots. Emirates group has 95,000.
3) Spending too much on publicity. $3B is too much on brand building for any size airline.
4) Too much publicity on low seat costs while ignoring trip cost. If I recall correctly fleet wide load factors are in 70% range.
5) Extreme case of Peter's principle. Keep up-guaging every route until it has bad load factors.
6) Yields are not good either, particularly premium cabin yields.
7) No consistent hard product, too much publicity on A380. Eg., B77L starter to B77W LA to A380 VLA (the best). Lets say LF is 75%. No clue what to do at this point about second frequency. Should they deploy B77W (inferior product in its own words) and every one trying to get on to the first A380 or second A380 and bring LF to 35%.
8) I think Tim Clark likes A380s because he thinks pilots cannot quit easily because they don't have many other options.. Nothing more.

WRT point 2:
A workforce : fleet ratio of 229:1 should be alright, specially given that they deploy an all-widebody fleet, which incidently would need more staff than a fleet composed entirely of B737 / A320 family or a mix of wide and narrow bodies.

TWA772LR wrote:

David_itl wrote:

Does the margin REALLY mean that much? They have decided to develop a network and accepting smaller profits than play chicken like the 3 major US airlines at the 1st sign of competition and withdraw or make seasonal their routes.

Would you invest in a cool flashy airline from a mysterious part of the world, or invest in an airline making consecutive billion dollar profits in a stable part of the world?

Can you explain whx DXB is a "mysterious" part of the world?

N14AZ wrote:

TWA772LR wrote:

David_itl wrote:

Does the margin REALLY mean that much? They have decided to develop a network and accepting smaller profits than play chicken like the 3 major US airlines at the 1st sign of competition and withdraw or make seasonal their routes.

Would you invest in a cool flashy airline from a mysterious part of the world, or invest in an airline making consecutive billion dollar profits in a stable part of the world?

Can you explain whx DXB is a "mysterious" part of the world?

People view the Middle East either as a war zone or a place that's been untouched by the West that has a certain mystique to it. The way I meant to use it I guess is closely related to the definition of exotic. I didn't mean anything negative by it.

Waterbomber wrote:

I know what I'm talking about, but you don't seem to have the slightest clue. There is a direct correlation between continued lower oil pices and EK's inability to grow. One of them has been mentionned above, ie less oil traffic. But that's not the main link and to understand the main link, you have to understand how countries work, how and why they pursue foreign currency reserve, and how airlines fit into that strategy.
3 more years of low oil prices and John Leahy can throw away the A380 brochures and Boeing can hold firesales on new B777X's, none of the ME3 will be able to take their orders.

You clearly do not know what you are talking about. Dubai works in a very different way from most other countries.

EK is not, and never has been, financed by oil revenue, and oil traffic is a vanishingly small part of their total traffic.

David_itl wrote:

Does the margin REALLY mean that much?

No. The whole reason for EKs existence is to generate revenue for state of Dubai. Partly by generating profits (who cares if it is high margin on low turnover or low margin on high turnover?), partly by bringing people in to the area to spend money in other industries (tourism, finance, property, etc).

mjoelnir wrote:

But that is what Dubai is living on. Tourists, trade, banking, shipping etc. Oil and gas is less than 5 % of the economy. And Emirates is bringing those people to Dubai. The airport is living of shopping being a huge mall. All Dubai is a huge mall. As long as Emirates is run at a profit, not a loss, I do not see a lot of trouble.

We have to understand that EKs business model is economy of scale. It's not accidentally, it's intentionally. With the biggest planes, they get the best operation cost. Therefore they can make huge $$$ with load factors in the 70s range. Few airlines are able to do so. A big marketing machine helps to fill the seats. Every seat sold extra instead of remaining empty is pure profit, therefore the marketing expense is ok. With their growth, they prevent the competition from enjoying the same economy of scale. One reason for (big) widebody only is, however, the slot restriction in DXB, it will be interesting to watch whether they will start thinner routes with smaller planes from DWC.

mjoelnir wrote:

But that is what Dubai is living on. Tourists, trade, banking, shipping etc. Oil and gas is less than 5 % of the economy. And Emirates is bringing those people to Dubai. .

Well said. In comparison in 2015 Oil and Gas contributed for 20% or Norway's GNP.
I'm bringing my family to Dubai next summer. And btw ... we're flying EK (a B777-300ER me think)

Waterbomber wrote:

Unfortunately, the new US administration will be very protectionist and will make any further growth very difficutl for EK and its sibblings. EK has gotten far enough, now they need to turn it into a sustainable business, like everybody else.

Given that only around 7% of EKs routes currently include the USA, I really can't see how protectionism in the USA is going to cause any difficulties for EK in maintaining growth on the other 93% of their routes, or to new destinations elsewhere.

speedbored wrote:

You clearly do not know what you are talking about. Dubai works in a very different way from most other countries.

Maybe a person who clearly doesn't have a handle on basic geography shouldn't be doing the lecturing.

speedbored wrote:

EK is not, and never has been, financed by oil revenue, and oil traffic is a vanishingly small part of their total traffic.

Sure the economy is now very diverse and oil accounts for 5% or less of their GDP but you don't have to look much beyond the recent 10% decline in real estate values in Dubai to see how the spill over effect from the oil industry still impacts that tourism and financial services driven economy. Assuming zero inter-connected relationships in this region is naive or need an economics lesson.

Finally, oil isn't huge now but it did directly drive about 50% of Dubai's GDP in the 1980s when EK was founded and if you don't think that the $10 Million Ahmed bin Saeed Al Maktoum gave to Maurice Flanagan to start EK didn't have some origin in oil then not only do you need a geography lesson, an economics lesson, but a history one too. In the mean time, maybe just less lectures.

Links for those that care:
http://books.google.com/books?id=Se0_Cw ... 80&f=false
http://www.bloomberg.com/news/articles/ ... wn-in-2016

And a final quote from Ahmed bin Saeed Al Maktoum underscoring his belief of his family's own dependence on oil:
""My grandfather rode a Camel, my father rode a Camel, I drive a Mercedes, my son drives a Land Rover, his son will drive a Land Rover, but his son will ride a Camel""

tortugamon

tortugamon wrote:

speedbored wrote:

You clearly do not know what you are talking about. Dubai works in a very different way from most other countries.

Maybe a person who clearly doesn't have a handle on basic geography shouldn't be doing the lecturing.

And maybe a person who is going to post sanctimonious replies ought to check the context of what they are replying to before posting. I am fully aware of the status of Dubai "country" was a reference to the original comment I was replying to.

tortugamon wrote:

Sure the economy is now very diverse and oil accounts for 5% or less of their GDP but you don't have to look much beyond the recent 10% decline in real estate values in Dubai to see how the spill over effect from the oil industry still impacts that tourism and financial services driven economy. Assuming zero inter-connected relationships in this region is naive or need an economics lesson.

But I wasn't talking about the effect of oil price on the economy as a whole. I was simply stating that "oil traffic" is insignificant for EK, in reply to waterbombers "less oil traffic" being an issue claim.

tortugamon wrote:

Finally, oil isn't huge now but it did directly drive about 50% of Dubai's GDP in the 1980s when EK was founded and if you don't think that the $10 Million Ahmed bin Saeed Al Maktoum gave to Maurice Flanagan to start EK didn't have some origin in oil then not only do you need a geography lesson, an economics lesson, but a history one too. In the mean time, maybe just less lectures.

Ah, OK, so the fact that just $10M of the more than $50bn of finance so far used by EK (i.e. less than 1/50th of a percent) might have originally been obtained from oil revenue, proves that EK is "financed by oil revenue", then you need a reality lesson.

tortugamon wrote:

Finally, oil isn't huge now but it did directly drive about 50% of Dubai's GDP in the 1980s when EK was founded and if you don't think that the $10 Million Ahmed bin Saeed Al Maktoum gave to Maurice Flanagan to start EK didn't have some origin in oil [...]

Nice try.... because EK got a B727 from Dubai's ruler in the 80ies and because at that time Dubai had some oil revenues is now the proof why EK is financed from oil revenues.

Time to purchase the B748 with the super efficient engine and boost the profit quickly. LH is making far more profit with the B748 than the A380 so maybe they can copy and learn!

warren747sp wrote:

Time to purchase the B748 with the super efficient engine and boost the profit quickly. LH is making far more profit with the B748 than the A380 so maybe they can copy and learn!

I made a similar proposal in reply 2....

Do you have a source for your claim?

MoKa777 wrote:

EK is probably one of the best run companies in the world. .

It almost certainly is. It is also a company that did benefit much from the weakness of the competition than its own strength plus having by far the most modern and economic fleet around. With that competition having done a lot of homework, that edge has all but disappeared. And with the old dinosaurs finally get new metal, it is not competing with 77W and A380 against 747 and A340, now it is 77W against A350s and 787s....

TK is also looking at up to a billion in losses this year...

est regards
Thomas

chiad wrote:

mjoelnir wrote:

But that is what Dubai is living on. Tourists, trade, banking, shipping etc. Oil and gas is less than 5 % of the economy. And Emirates is bringing those people to Dubai. .

Well said. In comparison in 2015 Oil and Gas contributed for 20% or Norway's GNP.
I'm bringing my family to Dubai next summer. And btw ... we're flying EK (a B777-300ER me think)

And for anyone else who thinks Dubai is all a mirage - it's been done before... very successfully... in fact Dubai is copying someone else in almost every respect...


Singapore.

TWA772LR wrote:

N14AZ wrote:

Can you explain whx DXB is a "mysterious" part of the world?

People view the Middle East either as a war zone or a place that's been untouched by the West that has a certain mystique to it.

I think you should amend that to "people in the US (and parts of Europe)".

I'm sure a great deal of the world's population has a very different perspective.

warren747sp wrote:

Time to purchase the B748 with the super efficient engine and boost the profit quickly. LH is making far more profit with the B748 than the A380 so maybe they can copy and learn!

Yes, and Air Koryo is making much more money with their IL-62M than they never had, let's all copy them!

Please show us some numbers before throwing comments like this.

I think people here should really have a look at what Dubai is living on and that is not Oil. Dubai is big in distribution, both FedEx and UPS have big operations there. Fed Ex has its Middle East, Indian Subcontinent and Africa distribution center there. UPS at least its middle east distribution center. Dubai world port is one of the biggest container harbors in the world, stuff that comes and gets distributed, a small part going to Dubai itself. Dubai is a big airfreight hub. That is the part I call trade and transport. Than one can start on tourism, of trade, quite a few people come to Dubai to buy stuff, not only personally while filling the malls, but for business, because a lot of companies have there distribution centers in Dubai. Dubai is a banking center and so on.
Apart from that Dubai has build up some industries, like Aluminium doing about 1 millon t of raw aluminium and also half finished products from that.
Dubai started to diversify after their oil production peaked at 410,000 barrels a day in 1991 and has been declining since. I know that the UAE are a big oil producer with about 2.7 million barrels a day, but that is mainly Abu Dhabi. The other Emirates in the UAE do not have a lot. To get an impression about the distribution between the Emirates, Abu Dhabi has 93 billion barrels reserve, Dubai has 4 and Sharjah 1.5. The USA has about 40 billion barrels proven reserve, Norway around 6 billion and is producing about 5 times the amount Dubai did peak at in 1991. Leading this list is Venezuela with around 300 billion barrels reserve.

tommy1808 wrote:

MoKa777 wrote:

EK is probably one of the best run companies in the world. .

It almost certainly is. It is also a company that did benefit much from the weakness of the competition than its own strength plus having by far the most modern and economic fleet around. With that competition having done a lot of homework, that edge has all but disappeared. And with the old dinosaurs finally get new metal, it is not competing with 77W and A380 against 747 and A340, now it is 77W against A350s and 787s....

TK is also looking at up to a billion in losses this year...

est regards
Thomas

This.

Yes, they are one of the best run companies in the world but as you put so well, competitors have gone back to the drawing board and learnt how to compete. The lower than ideal numbers are not an indictment against EK but rather a reason to respect the competitors who are doing well enough to now hurt EK.

Also, world events cannot be ignored when looking at these numbers, as you allude to by mentioning TK.

N14AZ wrote:

tortugamon wrote:

Finally, oil isn't huge now but it did directly drive about 50% of Dubai's GDP in the 1980s when EK was founded and if you don't think that the $10 Million Ahmed bin Saeed Al Maktoum gave to Maurice Flanagan to start EK didn't have some origin in oil [...]

Nice try.... because EK got a B727 from Dubai's ruler in the 80ies and because at that time Dubai had some oil revenues is now the proof why EK is financed from oil revenues.

Nope, not saying that at all. Just disputing an ill-informed poster who suggested that EK was never been financed by oil revenue. It clearly has.

Indeed currently EK is financed by its own thoughtful operations put in place by high-quality management and dreamed up by one of the middle-east's biggest visionaries and entrepreneurs. A wonderful example of the type of company the Middle East can create if they adopt similar vision/values.

tortugamon

mjoelnir wrote:

I think people here should really have a look at what Dubai is living on and that is not Oil. Dubai is big in distribution, both FedEx and UPS have big operations there. Fed Ex has its Middle East, Indian Subcontinent and Africa distribution center there. UPS at least its middle east distribution center. Dubai world port is one of the biggest container harbors in the world, stuff that comes and gets distributed, a small part going to Dubai itself. Dubai is a big airfreight hub. That is the part I call trade and transport. Than one can start on tourism, of trade, quite a few people come to Dubai to buy stuff, not only personally while filling the malls, but for business, because a lot of companies have there distribution centers in Dubai. Dubai is a banking center and so on.
Apart from that Dubai has build up some industries, like Aluminium doing about 1 millon t of raw aluminium and also half finished products from that.
Dubai started to diversify after their oil production peaked at 410,000 barrels a day in 1991 and has been declining since. I know that the UAE are a big oil producer with about 2.7 million barrels a day, but that is mainly Abu Dhabi. The other Emirates in the UAE do not have a lot. To get an impression about the distribution between the Emirates, Abu Dhabi has 93 billion barrels reserve, Dubai has 4 and Sharjah 1.5. The USA has about 40 billion barrels proven reserve, Norway around 6 billion and is producing about 5 times the amount Dubai did peak at in 1991. Leading this list is Venezuela with around 300 billion barrels reserve.

Thanks for this perspective!

To round out what Dubai is doing in Oil. They run a refinery that uses about 120,000 barrels crude a day. They still produce around 70,000 barrels a day and import the rest. They buy LMG from Abu Dhabi additional to what they produce themselfs. Dubai is today a net importer of oil. There main business regarding oil are running facilities that support oil extraction, processing and trading.

Quote: "However, Dubai remains deeply involved in the petroleum sector as a hub for oil trading and energy services. The port of Jebel Ali, located about 35 kilometres south-west of the city of Dubai, handles a large part of the UAE’s trade in refined petroleum products and can accommodate tankers of up to 80,000 tonnes capacity."

https://aleklett.wordpress.com/2014/10/ ... -producer/

EK finances nothing to do with oil economy is like a fish and chips shack next to a factory has nothing to do with manufacturing.

Bulk of Emirates finances are sourced within the region ie., oil economy, mainly from Kingdom of Saudi Arabia and State of Kuwait.

BombayFlyer wrote:

A workforce : fleet ratio of 229:1 should be alright, specially given that they deploy an all-widebody fleet, which incidently would need more staff than a fleet composed entirely of B737 / A320 family or a mix of wide and narrow bodies.

229 not counting 24,000 dnata in Dubai.

4000 pilots
20000 cabin crew
31000 EK support staff
24000 dnata (shared), (dnata approximately has 16,000 employees outside Dubai of total 40,000 strength)

Rule of thumb, a WB doing ULH needs 22 (11 sets) pilots and 100 cabin crew. It should have 5,800 pilots and 24,000. Assuming % of ULH routes are minimal, and Medium/Short haul doesn't need that many, numbers should be a OK. Problem crew rosters are horrible, don't know why.

Mystery part, what are other 31000 (I am guessing EKAS) and shared 24000 dnata doing at ONE hub.