Dubai’s Emirates Group reported a 67% jump in full-year profit and said there are no plans to merge with Etihad Airways, the Abu Dhabi airline that’s shrinking operations following a record loss.
“Many people have reported there will be a merger,” chairman Sheikh Ahmed bin Saeed Al Maktoum said in an interview with Bloomberg Television.
“There is no such thing. Not at all. I think when we talk about synergy today, it is between Emirates and FlyDubai.” There have never been talks with Etihad about a merger, he added.
Local press reports have suggested that a deal might be on the horizon after state-controlled Etihad posted a US$1.87 billion loss in 2016 following the failure of an alliance-building strategy that saw it pour cash into Air Berlin and Alitalia, which later filed for insolvency.
The airline group's chairman also played down the impact of a staffing shortage that Tim Clark, the airline’s president, said last month had led to the idling of planes and paring back of flights.
Emirates is short of “small numbers” of cabin crew and doesn’t lack pilots as it seeks to better match recruitment to the arrival of new aircraft, Sheikh Ahmed said. The overall headcount fell 2 percent during the year to just above 103,000.
The world’s biggest long-haul carrier boosted net income to US$1.1 billion in the 12 months ended March 31, with earnings rebounding after a slump in the previous fiscal year as Emirates pared frequencies to destinations including the U.S. and higher crude prices lifted sales from the region’s oil-based economies.
The carrier is reaping benefits from closer ties to sister company FlyDubai, pushing any deal with Etihad off the agenda, according to Chairman Sheikh Ahmed bin Saeed Al Maktoum.
The earnings indicate Emirates is emerging from the toughest operating conditions in its three-decade history. The carrier has become an industry heavyweight by exploiting the Gulf’s position at a natural global crossroads, something that Etihad had sought to replicate.
Qantas - Qantas Frequent Flyer
31 Aug 2012
Total posts 210
The child-like rivalries between the various components of the UAE (and Qatar) will rule this out. Also any state-owned airline in this part of the world can burn through cash indefinitely.
Qantas - Qantas Frequent Flyer
04 Nov 2017
Total posts 325
They may have ruled out a merger. But a "Takeover" on the other hand (That's If EY doesn't reach whatever the liquidation stage procedures are in the Middle East).
Qantas - Qantas Frequent Flyer
18 Jan 2017
Total posts 22
As long as Etihad is owned by the Royal family of Abu Dhabi, it'll never reach liquidation or bankruptcy. Saving face is of the utmost importance in the Middle East.
American Airlines - AAdvantage
20 Jun 2012
Total posts 25
I suspect the "father state" of the UAE will define how this all pans out...... as it did when finances ran out for the "Burj Dubai", bailed out and renamed.
Qantas - Qantas Frequent Flyer - Chairmans Lounge
01 Sep 2011
Total posts 413
Reg beat me to it. I believe he has hit the nail on the head. That was a billion dollar bailout not that many years ago.
Qantas - Qantas Frequent Flyer
08 Sep 2012
Total posts 236
I winder if now is the time for Etihad to join an alliance to give them the network they can't afford to/justify building themselves - so as to have a competitive advantage over Emirates. If they joined Star Alliance they would compliment Ethiopian and keep Egyptair on their toes. They're already in talks with LH over South America. Could work nicely.
29 Feb 2016
Total posts 28
Certainly wish EY would join up (and take VA with them..)
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