Flying high: Exclusive interview with Emirates president Sir Tim Clark - Gulf Business
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Flying high: Exclusive interview with Emirates president Sir Tim Clark

Flying high: Exclusive interview with Emirates president Sir Tim Clark

Long-serving president Sir Tim Clark reveals the plans in place to take the company to even greater heights

First of all, let me ask you, could the Emirates success story have happened anywhere in the world other than Dubai?

“We are not only successful because we are based in Dubai. We are successful as an airline because we are fortunate enough to have visionary leaders who had the belief and the foresight 30 years ago to start an airline that they always knew would be successful. It was never if we are successful but always when we are successful.

“That kind of belief has helped Emirates and Dubai become the international powerhouses that they are today. Take a good look at any successful business; they all have two things in common, strong leadership and vision. Vision that is not held back by fear but rather pushed forward by it. As an airline we are tenacious, we have been hungry for success since day one and that determination still drives us every single day.”

Moving on, the open skies debate has become adversarial to say the least. Are we any nearer an outcome and what is your message to the American carriers accusing the Gulf ‘big three’ airlines of unfair state subsidies running into billions of dollars?

“We’ve made our position very clear. We are not subsidised – we never have been and never will be. We are here to make money and provide our customers with the very best service possible. The US carriers have spent so much time and money slinging mud our way that they seem to have forgotten about their most important asset – their customers.

“Perhaps if they spent more time worrying about their in-flight offering and what they could do to win back the love of the American public they wouldn’t be in the position they are today.”

So is this just sour grapes protectionism, is service simply better on the Gulf ‘big three’ than western airlines – meaning passengers are simply voting with their feet?

“Well, I can’t speak for the others but we have carried over 11 million passengers to and from the United States since 2004. They’ve paid from their own pockets to fly with us and they’ve chosen to fly with us because we offer an excellent product, we fly where they want to go and we offer great value for money.”

You said three years ago that the Gulf ‘big three’ and other new airlines had brought about a “fractioning of the world order of aviation internationally that dominated from the 1980s to 2008”. Do you think the older airlines became complacent, as is the case with all cyclical monopolies?

“Many legacy carriers have a raft of issues. Becoming too institutionalised and bureaucratic are just some of these issues. It creates inefficiencies across the board and drives up costs. In this business you need to be agile to be profitable. There are, however, some legacy airlines that are now looking at their own business models in a new way –like British Airways. As with Emirates, BA believes in change and progress in aviation, and the value it brings to world economies.”

I understand the lack of liberalisation in the Canadian market has restricted the number of Emirates flights to that country. Are you making any progress there in terms of improved relations and potential new slots opening up?

“It’s exciting times for Canada at the moment with a new government in place. How this plays out in relation to more liberal access for Emirates, only time will tell.”

Could you outline the extent of the company’s global expansion plans in terms of new destinations, passenger numbers, additional aircraft and the economic projections?

“Well, next year we will be receiving 37 new aircraft, 21 A380s and 16 B777s. We’ll also be retiring some of our older A330-200s. In terms of network expansion, we’ve just launched Bologna, our second point in Istanbul launches on December 15, and Panama City is next on the agenda in February.

“So far this year our top-line figures were hit hard by the strong US dollar against other major currencies like the euro, rouble and yuan. The currency exchange situation, combined with ongoing regional conflict and less than positive economic outlook in many parts of the world dampened the positive impact of lower fuel prices during the first half of our financial year.

“However, we made a calculated decision not to hedge our fuel purchases, which paid off as fuel prices continued to soften. We also made the decision to pass on savings from the lower fuel prices to our customers by cutting passenger fuel surcharges and lowering fares across the network.

“From now until early 2016 at least, we anticipate it will be more or less status quo for the fuel and currency situation – and that major economies will see continued volatility. We are keeping a close eye on things and we will calibrate our operations accordingly to ensure we are deploying capacity to best serve our customers across our global network.”

How will the opening of Concourse D at Dubai International Airport affect your operations?

“The opening of Concourse D will help create more slots for Emirates, as it will allow us to fully take over Concourse C. However, this won’t be until we refurbish the entire concourse. At the moment we are managing great degrees of complexity and difficulty with our current slots at Dubai International Airport.”

And what are the company’s plans at the Al Maktoum International Airport – how soon are you planning to transfer across to the new airport and how will your operations be split between the two airports in Dubai?

“Al Maktoum International Airport isn’t ready to accommodate Emirates right now. We see it as 10 years away. We don’t plan on a split operation either.”

How much of an opportunity are untapped markets like Iran and Cuba for Emirates?

“Well, we just opened our second point in Iran – Mashhad – in September. Iran is a market we are watching but we don’t have any immediate plans to open up new points.

“We’re always scouting new destinations to expand our network and regions like Central America and the Western coast of Latin America are a logical next step. What we don’t have right now though is an aircraft that can reach many of these cities on a non-stop basis from our hub, so it’s a case of waiting for the Boeing 777X before we start making more announcements for this part of the world.”

Limited airspace and the complexity of air traffic control surely mean that the expansion of airports will plateau as we simply run out of room physically to put more planes in the sky. Is that a major concern for you?

“It is manageable at the moment and we have pinpointed the issues. No one could have imagined that we would have six busy international airports sharing the same airspace. We are looking at something similar to the Eurocontrol structure and are talking to them to learn from their experience managing the European airspace.

“Dubai International has 64 movements per hour, with a big mix of aircraft sizes, so we have a number of challenges. I think we will begin seeing progress in the next two to three years on this front because we have governments that understand the criticality of making this work.”

You are launching a service to Panama in February. Why did you choose that destination rather than somewhere like Mexico and what other routes in the Americas are planned?

“Panama City is a dynamic business destination, especially with the Panama Canal linking North America to South America. It’s also a gateway to Central and South America with a strong local airline, with which we have an interline relationship to facilitate onward connections to other cities in Central America.”

The recent television spot featuring Jennifer Aniston has been well received. Will there be other campaigns along the same lines and does this reflect a new content marketing/native advertising approach from Emirates, given that the millennial consumer now expects to be entertained by brand promotions?

“We’re proud of the Jennifer Aniston campaign. Like all good businesses we have a number of projects on the go at once. We are always looking to produce innovative and interesting content that our customers can engage with.

“The way in which people consume content and ads may have changed with technology but the basic tenets remain the same – people are excited by things that they can relate to, find interesting, entertaining or emotive. Our ad ticked those boxes: it was funny, people could relate to receiving ‘nightmare’ service and Jennifer Aniston is an instantly recognisable personality. She was the perfect fit for the script.

“When you have strong communities across your social platforms and your content inspires them to share it, then I think you’re onto something.”

The plan for Expo 2020 is for 17 million people to come through Dubai in just six months. Is this even possible logistically?

“We will have the infrastructure. There are many things that distinguish Dubai and something that the government has nailed down to an art is hosting the largest events and doing it well. The city is growing and hotels are being added to accommodate the numbers. As an airline, we anticipate that in the year of Dubai Expo 2020, we will carry roughly 70 million passengers.”

Did the Airbus A380 and the company’s assertive purchase of those planes provide a springboard for it to become the dominant global brand it is today?

“The A380 has played a key part in building our brand but it certainly isn’t the whole story. Let’s not forget that we only received our first A380 seven years ago and the airline has been in operation for 30 years now. We’ve been painstakingly building the brand and focusing on our capabilities for years.

“From the outset, we behaved differently and prioritised not only expansion but also innovation, product quality and service standards. We focused on how we projected the brand and built a formidable portfolio of sponsorships. It’s not just one aircraft model that has made us what we are, it’s a combination of successes that have made us the most valuable airline brand in the world today.”

You have a major alliance with Qantas. Are there any other similar type deals on the horizon – do you want to pursue such partnership strategies or go it alone?

“Our partnership with Qantas is a unique one and it’s an agreement that has been working well for both of us. If we can find a partner for a similar arrangement we will pursue it but at the moment nothing is on the horizon. Aside from Qantas, we have codeshare partnerships with 15 other airlines. We will continue to look at such arrangements where it mutually benefits our customers and both airlines.”

Emirates has an extensive sports sponsorship portfolio. What are the tangible benefits these sponsorship deals bring the company and are you looking for further such opportunities?

“Sponsorship has been one of the best ways to connect with our passengers, allowing us to share and support their interests. We have seen many of our global sponsorship deals pay dividends when it comes to brand recognition, especially in new and untapped markets. We see sponsorship as a key element to our continued success.”

What effect is the low oil price having on your business – is it leading to lower fares and increased passenger numbers or decreased investment in the airline and aviation industry, or all of the above?

“As I’ve said in the past, it’s a double edged sword. Oil prices have dropped but we’ve been significantly hurt by the currency exchange situation. Aviation is a bit of a litmus test of global activity. As oil prices weaken, many airlines have eased off investing in aircraft but Emirates hasn’t stopped. When it comes to our fleet decisions, it’s about technology and efficiency as oil will not always be at that price.”

Finally, can you outline the ways in which you plan to enhance the customer experience going forward – what are the in-flight innovations coming down the line?

“Well, there are a number of enhancements coming down the line. Not only onboard but also on the ground and the online experience. We continue to invest in our global network of dedicated lounges, 24/7 customer service centres and mobile technology for planning and booking flights, check-in and so on.

“At the Dubai Airshow this year, we were showcasing our brand new two-class A380. The economy class seats have larger screens at 13.3 inches and we have just announced larger screens in first class at 32 inches. There are other plans in the pipeline and we’ll announce them when the time is right.”

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