Last week, Emirates Airlines achieved profitability for the first time since the COVID-19 pandemic, according to company president Tim Clark. This success is primarily attributed to strong demand for air freight and exceptional passenger interest in the newly launched "premium economy" class. Clark noted in an interview with Airline Ratings that "it has become clear that travelers are willing to pay extra for better services."
Increased Freight Activity
The president of Emirates confirmed that all Airbus A380 aircraft are expected to resume operation within the next one and a half to two years at most. He added, "It would be crazy for airlines not to bring the A380 models back into service, especially since companies have recently achieved good revenues due to prices rising to much higher levels than before. Business class is thriving, contrary to what some are saying, as people are willing to travel more than expected."
Clark believes that "when some airlines announce they will keep A380 aircraft grounded, that’s good news for us." He continued saying, "We are working on restoring our full flight network, but the challenge lies in reinstating all our crew members. It may take until mid-2022 to bring our fleet back to its pre-pandemic status."
Clark pointed out that cargo activity has recently surged and is expected to continue over the next two years. As a result, "we have converted 17 Boeing 777 aircraft from passenger to cargo operations; in fact, we could convert our entire fleet of 160 777 aircraft for cargo and keep them fully operational."
Achieving Balance
Last week, Emirates Airlines managed to break even on expenses against revenues, marking "the first week we succeeded in turning a profit since COVID-19, even though we still have 95 A380 aircraft grounded." Clark pointed out that Emirates "used to transport around 170,000 passengers daily, and now that number ranges between 60,000 to 70,000. However, air freight activity has doubled, yielding us significantly higher revenues than before."
He further explained that "all airlines have incurred high debt on their balance sheets due to the pandemic, and thus, they cannot reopen unprofitable long-haul routes or purchase new aircraft. Their current focus is on achieving balance, which will result in aircraft capacity remaining much lower over the next two years compared to 2019."
Additionally, Clark revealed that soon the airline would have six Airbus A380 aircraft featuring the new "premium economy" class, "which are likely to operate on the Dubai-London and Dubai-Sydney routes. We aim to introduce this highly in-demand class to our fleet as soon as possible. All our new aircraft, including the Boeing 777-9, 787 Dreamliner, and Airbus A350, will have the premium economy class."
