Tag Archives: Emirates Airlines

Follow your own Sheep, Airline Style

You do wonder what sort of credentials you need to run an Airline, it is very difficult, in fact it is one of the worse sort of businesses to do business, there are so many factors in the fact that can send you broke on a weekly basis, some can be the changeable climate of the traveling public, others are anything from hijackings to tsunamis, fuel shortages, volcanos, snow, pilot and ground staff strikes, computer catastrophic failures, bad press, engine explosions or the worse of all, the loss of aircraft, passengers and crew.

Airlines as a whole don’t make money, losing it is easy, making it is very difficult, so why do you want to be in this business, because it is glamorous, well maybe yes to a point, some call it the “bus service in the air”, which is a fair comment in todays highly regulated on time service environment, but there is something in that fact as flying is a still a wonderous thing to do even for people who hate it, nothing is more amazing than the fact you can circle half the globe and land within minutes of the scheduled timetable, and within the hours of a 24hour day, Sydney to London, in the time of only one day of your life, and for only $2000.00 is in anyone’s terms  a great deal.

With all these issues to face everyday you would want to minimize your losses by selecting routes that are profitable and useable, but there is a strange fact that sometimes in doing this, all reason goes out of the window, take for instance New Zealand.

Now New Zealand is a pretty country that is somewhere in the low South Pacific Ocean and at last count there was 4,315,800 people residing there, and of that  1,110, 456 of them visited Australia, and from Australia they have in the fact that 1,115,285 of them then returned the favour by going over there.

So that would seem like a pretty big market, plenty for everyone to have a slice of the travelling cake, however if you are in an airline management position this would seem to be a rainbow gold mine just waiting to be dug.

It is but a strange thing happened, for such a small country airlines have been swapping and changing around to the point that it is a lottery to seem which one will be ready for you at the airport when you get there!

Almost all have been non New Zealand Airlines and mostly come from big brother Australia, long forgotten Ansett ruled the roost for years with a massive 30% share of the cake, then Qantas in some form or the other took over the debris when the airline was grounded in 2001 and being renamed Qantas New Zealand, in 2003 Qantas created their successful LCC (low Cost Carrier) offshoot Jetstar which commenced New Zealand operations on the 1 December 2005  to Christchuch (CHC) and on the 10 June 2009 Jetstar commenced domestic New Zealand flights between Auckland, Wellington, Christchurch and Queenstown.

New Zealand has it’s own national airline called Air New Zealand which by all cases in the last decade has been a total basketcase, New Zealand as a market that is so very small for a large legacy carrier that has 6 Boeing 747-400’s always parked under the window, but under the stewardship of Rob Fyfe who was appointed in 2005 the airline has become the one to watch and now covers 27 domestic destinations and 26 international destinations, making money in a creative way which much like Singapore Airlines in Singapore, and in doing so out go the big thirsty B747’s and in come B777’s which are more suited to long thin routes, in other words good management.

Another upstart that tasted the New Zealand gold rush is Virgin Blue, based in Brisbane (BNE) , started in 2000, it had the good fortune in that Ansett dissolved right in front of them and created a market almost overnight, a LCC that was on the hunt soon dominated the Australian low-cost market and in 2003 a subsidiary of Virgin blue, Pacific Blue was heading over the Tasman Sea wanting some of the ready cash.

But in most cases you always found yourself on a Virgin Blue aircraft as the fleet was rotated around to cover the only few Pacific Blue Boeing 737’s flying, and Virgin then thought “well we are over there so why don’t we do domestic New Zealand as well”, well why not, it’s a free world.

So if you wanted a flight from Aussieland to Kiwi Land, then the choice is large, Qantas, Jetstar, Virgin Blue, Pacific Blue and not forgetting Air New Zealand, now on top of all that it is because New Zealand is where it is then most international carriers will terminate their service in either Auckland (AKL) or Christchurch (CHC), and in most case many have 5th freedoms of the air rights, which means that “they have the right to fly between two foreign countries during flights while the flight originates or ends in one’s own country”, so you can sway your way down to Sydney Airport, drop $210.00 into a Emirates passenger ticket and then rumble right along and taste the space and giantness of their double decker bus, the A380, well they are getting 90 of them so why not drop a few on the Trans Tasman route and pick a few shekels moving Australia to New Zealand or vice- versa, 460 seats is a lot to fill, Melbourne’s the same, In Brisbane you can jump on a Singapore Airlines Jet and swan over in style, and not on a cramped B737 or Airbus A320.

If there is then a saturated market it is New Zealand, with only two major ports (AKL/CHC), and as sheep following sheep its getting seriously crowded parking in Auckland with empty planes, so what happens, they lose mountains of money, and it becomes a poker game of who will hold out till the last, all of them holding their breath, fares go to bucket levels, almost coming down to stealing passengers at airports trying to board the competition, and it goes on for years, upping the frequency or adding even more ports (Gold Coast, Cairns) to get a leg over the others…..

So who gave up first…..Virgin Blue/Pacific Blue, “what the hell it’s not worth it”, so they decided that we will put our precious resources somewhere else…and that is?

Perth (PER), the resource boom of shipping the whole of Western Australia to either China or Japan is in full swing and a market just waiting to be exploited, did they learn from losing all that cash in New Zealand, “hell no”, as “thar’s gold in those W.A. Hills”

Virgin Blue decided to ship people over to W.A. wholesale, by buying a couple of large Airbus A330’s and going business class too.

Qantas not to be out done looks around and realises that Jetstar has few loose A332’s available and  so puts them on the same route, Jetstar meanwhile is a regular customer at Perth, so is Singapore  Airlines offshoot Tiger (one Dollar seats) Airlines, Strategic Airlines is also based there, Skywest too, in fact there is 12 domestic airlines based in Perth, and how many people live there?

1,659,000, less than New Zealand, in fact far less than New Zealand, oh and there are a few 5th Rights Carriers passing through there too, suicide!

And on it goes, Sheep following Sheep, Perth has not even been on the map for decades, if you wanted to fly there it cost less to fly to Hong Kong, Japan even, in fact the cheapest way was to fly to Singapore and backtrack to Perth, those were the days, going international to fly to a domestic port?

Soon it will be dollar dazzlers, free meals, face painting to fill empty seats…Suicide.

So here we go, which one will pull out first, Qantas, Nah!, Jetstar, Nah!, Virgin Blue, Nah! too much at stake, Tiger..well maybe but their numbers are low anyway.

So it’s going to be a blood bath, and coming to an airport near you.

Say, there is a good traffic going down to Antarctica, could be on a winner there, seasonal is the only problem, “could you land an Airbus A330 on the ice?”

Sheep following Sheep, Oh by the way Tiger Airlines are going to do a new route……going over the Tasman to New Zealand….

……”oh for Christ’s sake”

Dubai…Still growing in the Airline Market

Dubai-Airport-Emirates

East to West was always a backwater business for the Airlines except for Singapore Airlines, British Airways and Qantas that ruled their golden Kangaroo Route treasure trove with piratical glee for as the real money was over the pond from Europe to the Good Olde USofA, but now suddenly the world has changed mainly with our Globalisation of the planet in that we are now all one world and not the just in the Western hemisphere of doing business, in this process with the opening of up China and its Tiger States the traveller is also changing the the way they see the world and move around it in business and pleasure as it is now East and West.

The old hub of Singapore today has real competition from the cashed up Gulf states that are changing the type of route you would fly East to West or Europe to Asia or vise-versa, it was once only Via SIN (Singapore) or HKG (Hong Kong) and BKK (Bangkok (a British Airways favorite)), Now in the last few years SEO (Seoul) put a foot in the door and so does NRT (Narita Japan).

but now more and more you can jump from Asia Via DBX (Dubai), in fact it is quite a hub, as you if you desire by flying into this gulf state you can suddenly fly straight to Canada or to Brazil or pretty much anywhere which is the expanding vision of Tim Clark Emirates Airlines chief designer of conquering the world from the air.

And it changes the rules so completely and so differently that it will change the way we travel and why, and it is also a gamble of such immense proportions that if it doesn’t come off it could bankrupt a country, a small country but a country never the less, and too make the gamble even harder Dubai’s next door neighbour Abu Dhabi’s Etihad has exactly the same idea and so does Bahrain with its Airline Gulf Air.

Who will win, all of them but Emirates will still be the one with most to gain with its global domination of its order of 58 Airbus A380 mega jets, in fact the plan is for these huge machines to circle the world constantly like satellites carrying passengers to destinations with Dubai as their hub and a stopover which means any travel from East to West will mostly in 10 years time move you through one these of the Gulf states and its pleasure Kingdoms, Etihad will in time join Emirates and not compete directly as a turf war would not be in the best interest of both states but instead create a bigger hub for all to share the foils of passing trade, just like they did in the old days of the desert caravans, for the older hubs like Singapore already the effects are showing, as Hong Kong is already 12.7% down (May 09) which you would put down to the crisis but Dubai after an initial downturn is already 7% ahead of last year with five new carriers starting services and a new local LCC (Low Cost Carrier) flydubai making its debut..and Oh they want your Cargo Business as well!

Dubai (6th busiest) will also overtake Singapore (Changi) in the Airport rankings this year with Hong Kong next on the list to which you would reply that the SAR was hurt badly by H1N1 flu virus and the Asian recession but also that it is tied to the fortunes of Cathay Pacific Airlines (49% of capacity) which is 6.7% down were as Dubai has Emirates (58.4% of capacity) charging into the future as if there was no tomorrow.

The economic crisis has of course put a major knife through the overall plan, but strangely in an odd way will save it as that the building fever was going overboard with bigger and bigger plans and crazier ideas fronting the Dubai planning committees, some are quite breathtaking in their execution and many will not (should not) survive the downturn, If 58 Airbus giants is not enough then what of a Underwater Hotel, Sports City, Pleasure Cities, The World, The Palms, Dubai Pearl not to mention Burj Dubai monster that at the top you can see London, most are already done or are near completion, but a little slowdown could allow the guardians of the desert to smooth out the edges a little, as it seems now a bit like a huge building sandbox that is not really a mirage in the desert type picture that will really draw the hoards they want, plus the fact that Airbus can only build 14 to 20 planes a year means that a little time would be good and if not for a better plan than pushing everything to open in 2012.

In fact the idea is that Dubai will be a world hub, a global hub for nomads and travellers passing through and spending a shekel on the way, an attraction of pleasure like Las Vegas or Orlando to visit and play in, its a big idea, a huge gamble and its very brave but it won’t happen yet, in fact it will take 10 years before it becomes the dream destination that the Emirati are working towards as for the danger is the economic problems facing the world are more challenging and harder than anyone will expect, but there is no doubt that if you travel from Australia or Asia to Europe in five years you will be able stay underwater, ski the slopes, stand on the highest point of a man made building, shop till you drop, play on the best Golf Courses, do any type of sport you desire or see a concert of your favorite artist then Dubai will be your destination on your way to somewhere else, in fact you may not want to even go anywhere else as the those smart business people in the desert will have have everything you want…..for a shekel or two of course.