Well, this thread certainly heated up since I was away!

Lots of things to reply to and comment on, but if I quoted each part of the previous few pages specifically I think it would be unnecessarily long and get in the way of the flow of the points being made, so I apologise for that in advance.

As edy4eva said in post 425, I think we have two or three different themes of discussion going on and I think it’s worth just summarising and highlighting where they separate.

The OP’s initial question is based on the idea that EK is doing something that traditionally is exceptionally difficult to make money on: commence regular service on ULH routes with high capacity, expensive to run planes (the A380). It is so exceptionally difficult, in fact, that he believes that EK must be absolutely mad to do this and even more insane to actually expand service with more cities, and more of these aircraft types. Therefore the airline must be losing money hand-over-fist - for the airline to continue to do this means that, as they aren’t going bankrupt, they must be propped up with cash being pumped in by owners.

Other posters replied with some viability and feasibility calculations, in an attempt to work out the cost of running an A380 sector to the USA and what factors impact that cost base. Data included publicly available fare data, aircraft specification and cost analyses in order to come up with scenarios where EK would lose or make money on the routes. Then further information was provided using traffic statistics to see whether these scenarios were viable and occurring in reality.

The counterpoint replies from the OP stated that even with a lower cost base of operations, this still wouldn’t be enough to cover costs, as there is ostensibly little O&D demand from the USA-DXB for the airline to charge premium yields. Other posters then provided additional data about what the traffic for EK is composed of (connecting traffic) and the connecting business model - and then updated the viability calculations with new cost and revenue assumptions.

So in essence, in order for you to come to your own conclusion about whether EK is a scam on a operational basis you would have consider the following:
- when evaluating whether it’s profitable to run a ULH operation, just how much does it cost to run a ULH sector - fuel costs and fuel capacity give you an idea as to the fuel costs, so your evaluation rests on EKs cost base, encompassing everything from crew costs, to sales to lease payments and depreciation
- if ULH is to pay its own way, is there enough revenue on these routes to cover those costs - a calculation you would have to base on passenger load factors and fares - here, do you rely on EKs own non-broken out load factor data or is there any external data you can better trust. If it doesn’t add up, is there any cargo revenue you could factor in? Is the proper allocation of fares to ultimate destination being taken into account and the additional costs thereof of the onward sector?
- in the case you think that the ULH is the most loss making of the part of the entire operation, can the rest of operations generate enough cash to cover those operating losses - does it make enough
- when evaluating EKs cost base, can we trust the representations of the financial reports to be accurate or misleading, and if it is misleading, is that intentional fraud in the reports or are true costs simply held off balance sheet, or are they simply operating in a lower cost environment?

As this hinges on cost metrics, clearly your evaluation is influenced by your opinion on the trustworthiness of information - either information provided by EK itself, or when comparing EKs public numbers with companies in the peer group, are the peer group numbers also transparent and trustworthy? Or are they themselves subject to certain factors?

Now you can see why the discussion has moved onto a wider discussion about the trustworthiness of accounts and published information; the position of EK in the wider context of its ownership structure and the Emirates Group and its non-airline operations; whether the airline and group’s owners have different objectives to the owners of other airlines around the world; whether the competition is “fair” or “subsidised” and what we actually mean by those terms - in short, we move away from a discussion based on questions with more verifiable answers and enter a realm of value judgements about motivations and ethics and sociopolitical decision making, which absence of controlled experimentation is always going to be the source of endless (internet) speculation.

It’s a discussion not just confined to aviation - but aviation being at the confluence of international relations, commerce, massive capital investment and national ego it is a convenient lightning rod for all sorts of agendas and debate - nor is it that recent: we’re really just bringing up all the issues around state capitalism. It’s a very popular model, either today Russia and China and their state-favored national champions, Singapore, Brazil with Embraer, Japan’s mid 20th century rebuilding, Korean chaebol, France’s post-war economy. The list goes on and on.

So the question discussion now focuses on:
- does EK operate in a benign business environment that is ostensibly available to anyone who sets up a business in the location or is EK getting specific, targeted help?
- do both of the above definitions qualify as “subsidy” or “unfair”?
- if a state does or does not provide services/tax regime which impacts the costs of operations of a company, does that qualify as being unfair or a subsidy?
- do we cast aspersions on the trustworthiness of their accounts because its a closely held company?
- how much of its costs, if any, are being moved off balance sheet, either through transfer pricing, preferential terms from affiliates, either inside or outside the group? Is revenue being inflated by having affiliated entities buying services from EK which causes those affiliates to sustain losses?
- what motivations are there for “dressing up the numbers”?
- if you think that EK is operationally profitable, should it be doing things like investing in hotels and real estate and making apparently massive marketing efforts, when margins are so thin?
- if you think that EK is running at losses, at what point does it move from making normal losses in the course of operations to a situation whether its owners are bailing it out then to a situation where its owners are subsiding the operation?

There’s no right or wrong answer of course, there’s only guesses (informed or not) as to the motivations of the various actors involved. Our speculations as to these motivations will be informed by our scepticism and trust of the information presented - there’s no verifying a lot of it. Then, we’re asked to make value judgements about the rightness or unfairness of comparative advantages.

And finally, there is a wider discussion about the aviation industry as a whole - has aviation ever been profitable since inception and is it unavoidable that someone, somewhere, usually governments, have made massive losses in propping up aviation in their home countries and whether that’s okay or not. Aviation is seen to be critical to infrastructure, seen to have a social use and public service imperatives - once again national ego comes into play. If aviation is, in the longer term, unprofitable, isn’t subsidy totally inevitable and part and parcel of an industry that requires massive capital investment and is incredibly vulnerable both to macroeconomic and demographic trends and also to “black-swan” events and short term swings in economic sentiment?

I'll reply to some of the specific points raised in the last few pages after I get some actual work done...