Emirates Beats Odds to Retain Profitability in 2014

It happens rarely in aviation industry that a carrier has an unbridled ride of profitability for 27 consecutive years. Emirates has achieved this tremendous feat by turning profitable in 2014, a year which saw many problems crop up for the carrier. It has been able to report a profit of $1.24 billion, a gain of 40 percent. While there were a number of stumbling blocks which it had to overcome, there were some facilitating factors which ultimately led to its good performance. While this is a good news for the carrier, its employees also have something to cheer about. They have been promised extra salary of 9 weeks.

Emirates had to overcome problems of temporary closure of runways at Dubai airport, Ebola outbreak, flight restrictions in conflict zones and unfavorable currency movement vis-a-vis US dollar.

The factors which came to its aid were rapid expansion strategy of the management and the declining fuel prices. It is the only carrier that has the largest number of wide-bodied aircraft such as Boeing 777 and Airbus 380s. To meet its rationale but rapid expansion strategies, it has ordered for another 279 planes besides the 230 already existing ones. The year ahead will see it face considerable challenge from the US carriers that are hell bent on curtailing their growth in the US market.

Mobile Boarding Passes, 49% Alitalia Stake- Etihad Making News

Etihad Airways has sealed the deal with Alitalia to pick up its 49% stake. This will be the largest investment by this Gulf carrier in a foreign carrier. Alitalia has been making losses for sometime now and was looking for funds to stay afloat. With this deal, Alitalia gets the much needed respite while Etihad seeks to deepen its connectivity in European markets. Etihad also has equity investments in other carriers such as airberlin, Air Seychelles, Aer Lingus, Jet Airways, Virgin Australia and Air Serbia.

The deal is likely to come under intense scrutiny by European Union, labour unions as well as other stakeholders of Alitalia. It is expected that there will be major moves to restructure the balance sheet of the carrier and about 17 percent of labour force might be rendered jobless. Another resistance to the deal would be from the other European carriers that have been pitching for retiring the loss making carriers to boost the profitability of the other carriers of the region rather than these being given leases of life by restructuring or government intervention. Lufthansa has already voiced its concern for this deal and its stated position on Gulf carriers eating into profits is also well known.

While the deal is going through, Etihad is also making changes to the way its customer experiences Etihad online check in and boarding using their mobiles. It has initiated the process of proving the online boarding passes through mobiles for passengers flying some routes and plans to expand the network to other destinations as well. The boarding pass will include a barcode which will be read by an electronic reader present at the departure gates.