The Etihad Aviation Group (EAG) and its equity partners are expected to contribute up to $9.6bn to Abu Dhabi’s economy in 2016, a report by Oxford Economics Group has found.
EAG and its partners will provide a ‘core economic contribution’ of $7.4bn and a tourism contribution of $2.2bn, the report said.
They will also support 62,100 jobs through their core operations and another 29,600 jobs via tourism.
The report also calculated that the air connectivity offered by Etihad Airways and its airline partners will ‘boost Abu Dhabi’s productivity’ by $17bn this year.
This equates to 5.9 per cent of the emirate’s gross domestic product and 195,600 jobs.
“Etihad’s impact in Abu Dhabi is a vital driver of prosperity for the emirate, the importance of which is set to grow in the next decade as the airline expands its service, bringing more visitors to the region,” Oxford said.
By 2024, the annual contribution by EAG and its partners to Abu Dhabi’s economy is expected to grow by almost 90 per cent from 2016 to reach $18.2bn.
That amount includes $12.6bn from core operations and $5.6bn from tourism.
Meanwhile the productivity boost from air connectivity will also grow to $27.1bn, the report said.
EAG president and chief executive officer James Hogan said: “As a major jobs creator and as a major spender with local suppliers, EAG has had an increasingly positive impact on the Abu Dhabi economy, year after year. These are long term, sustainable jobs which make a long term, sustainable contribution to GDP.
“As our equity airline partners continue to expand their connectivity with Abu Dhabi, we are seeing even greater impacts on the local economy.”
EAG was established in 2014 and comprises four business divisions – Etihad Airways, Etihad engineering, Hala group and airline equity partners.
Etihad now has minority stakes in seven airlines. Together, they carry 114.8 million passengers to over 600 unique destinations, on a fleet of 718 aircraft, served by 73,660 employees.
Hogan said: “Our two-pronged approach is delivering results for EAG and Abu Dhabi. At a strategic level, our equity partners bring network connectivity, generate additional revenues and create economies of scale. Every one of our partners is delivering on this level.
“Each partner also has its own business goals, which are the responsibility of their own management and boards of directors. Many of these, such as Air Serbia, Air Seychelles, Jet Airways and Virgin Australia, are now delivering profitably on this level.”
The investment in Alitalia is “well on track”, cutting losses by more than the company planned in the first full year, Hogan said.
“Airberlin has faced greater challenges and has taken longer than we expected to reach sustainable profitability, but the underlying fundamentals of the business are trending in the right direction,” he added.