Page 81 - AAA JANUARY - FEBRUARY 2017 Online Magazine

FEATURE REGIONAL AIRLINES
Emirates retired the last of its
A330s and A340s in October 2016.
It now operates a widebody jetliner
fleet that comprises of the Airbus
A380 and Boeing 777
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fact remains that even with the increase in
fuel prices, it is expected to account for 18.7
percent of the industry’s cost structure in
2017 and this still only about half of the 33.2
percent it accounted for in 2012-2013
Emirates Airline
Emirates has been a tremendous success
story and in just over three decades, the
airline’s brand value has grown to US$ 7.7
billion and was rated as the world’s most
valuable airline brand in 2016 (as per the
Brand Finance Global 500 report). From
commencing operations in October 1985,
with a flight from Dubai to Karachi and a
fleet of four airplanes (including two jets
leased from Pakistan International Airways),
Emirates today operates a solely widebody
fleet of 255 jetliners, that consists of only
two types, the Airbus A380 and Boeing 777.
The airline retired the last of its A330s and
A340s in October 2016. Emirates added
36 new jetliners (20 A380s, 16 Boeing 777-
300ERs) in 2016 and now has an average
fleet age of only five years. 29 airplanes were
also retired from service in 2016. Emirates
is the largest operator of the Airbus A380,
having inducted the first of the type in 2008
and has a total of 142 on order. However, late
in 2016, Airbus announced that an agreement
had been reached between the Emirates, the
airframer and engine provider Rolls-Royce
their average yields are low their unit costs will allow for postponement in the deliveries
are even lower. This is partly a result of the of six aircraft from 2017 to 2018. The
strong capacity expansion, which has seen deliveries of another six A380’s to Emirates
Middle East based airlines placing record are also be deferred from 2018 to 2019.
orders for the latest jetliners. However, the While Chairman Tim Clark has been vocal
IATA report warns, “Threats are emerging in his demands for an upgraded version of the
to the success story of the Gulf carriers, A380, it is now obvious that such an aircraft
including increases in airport charges across development is more than a few years
the Gulf States and growing air traffic away as Airbus focuses on its development
management delays.” Another aspect that of the A350-1000 and A330neo jetliners.
could hit Middle East based airlines, is the Commenting on a potential upgrade of the
new generation of ultra-long range capable A380 during the Airbus annual press briefing
twin-jet widebody airplanes that can be used in January, Fabrice Brégier, President of
by competing airlines from other regions to Airbus Commercial Aircraft, said, “We have
bypass the Middle East hubs on routes to the studied the possible evolutions for the A380
U.S., Europe or Asia. and we came to the conclusion that it was
There is also the matter of fuel costs, oil still not the right time to launch an upgrade
prices which averaged at US$44.6/barrel for the A380. To do that we would need to
(Brent) in 2016 are forecast to increase to invest some development costs and have a
$55.0 in 2017. As a result, there will be an better market environment and clear return
increase in jet fuel prices from US$52.1/ on investment.”
barrel (2016) to US$64.9/barrel (2017). The “So, in the meantime we have decided to
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