India the next frontier for Emirates Airline
Emirates Airline plans to boost its flights to India as the UAE’s two big carriers bid for more seats.
Emirates wants to increase its flights to India to five times daily for each of its destinations in the country. Etihad also plans to ramp up operations in India through its planned US$600 million investment in Jet Airways.
Under the deal, Etihad would acquire a 24 per cent share of Jet and be the first foreign airline to invest in India’s aviation sector.
“We have reached the maximum utilisation of rights,” said Sheikh Majid Al Mualla, the senior vice president of commercial operations for the Gulf, Middle East, Iran and Central Asia for Emirates.
“We are waiting for the next bilateral talks” to increase the seat share, Sheikh Majid said. Emirates has a seat factor of more than 80 per cent in this sector, which means for every 100 seats going one way, 80 are occupied.
It comes as air ticket prices in India surge by as much as 30 per cent as the weak rupee hits airlines.
SpiceJet, the country’s second-biggest budget airline by market share, is increasing ticket prices by 20 and 30 per cent, The Wall Street Journal reported last week. Jet Airways has also raised some fares by about 25 per cent.
Emirates operates 185 flights a week to 10 destinations in India, with 55,000 seats one-way between Dubai and India a month.
“India is one of our largest operations after Dubai,” said Sheikh Majid.
Etihad flies to nine destinations in India, operating 63 flights a week. Its average number of seats to India is 39,000 a month.
Analysts say Etihad’s planned investment in Jet would not necessarily affect the planned expansion of Emirates in the country.
“The effect will be minimal,” said John Strickland, the director of the London-based air transport consultancy JLS Consulting. “We are talking about a large and growing market where there is room for several strong players. Etihad will be able to access some traffic not currently accessible to Emirates; however, I would expect Emirates to negotiate further market access for itself and expand its position in additional Indian cities over time.”
Visitor numbers from India to the UAE have risen sharply in recent years as incomes increase in the country, benefiting the country’s retail and hospitality sector.
“India is a huge market not tapped by international airlines,” Sheikh Majid said. “It is untapped in different segments, and in the past few years we have seen growth in the leisure and business sectors as the purchasing power of Indians has grown. There are a lot of opportunities for everybody.”
He added that the carrier was not seeking partners with which to invest in the subcontinent’s aviation sector.
“We don’t have any interest currently,” he said. “We haven’t reached a saturation point.”
In response to its expansion geographically, the company plans to recruit about 6,000 employees this financial year.
Last week it restarted its flights to Tripoli with three flights a week. Emirates suspended the service 18 months ago in the face of the uprising against the former president, Muammar Qaddafi.