'Is Flying First Class Doomed?'
Aug 29, 2014 | 12:51 am
#76
Suspended
Join Date: Jun 2009
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Posts: 8,144
TSA is not that bad. Other then a few newsworthy incidents, most of the time going through security is a non event, especially with TSA pre check. I have never had an issue with TSA, if anything, quite the opposite
Aug 29, 2014 | 1:20 am
#77
Original Poster
Join Date: Oct 2011
Posts: 454
Wow, a well composed and clearly articulated response--thank you! I actually agree with your assessments for the most part.
I will point out that Emirates profits for a year are about comparable to what AA, DL, and UA can make in a quarter, however.
Again, I say that those state-owned enterprise carriers like EK, SQ, EY, TK, CX, etc. seem to be the only ones with the "tremendous" service and amenities and outrageous suites--with LH being the biggest exception. That says tons about LH and what it is able to do as a true private enterprise, and it reflects the challenges with other private enterprise carriers like UA, DL, AA, BA, AF, and the like in competing with those state-owned enterprises. It's easier for more authoritarian states like Thailand, China, UAE, and Singapore to build airports where and how they want compared with the industrialized and more democratic West, and it's easier IMO for those state-owned enterprise carriers to implement more fabulous offerings without the same profit concerns as their counterparts in the West, too.
I will point out that Emirates profits for a year are about comparable to what AA, DL, and UA can make in a quarter, however.
Again, I say that those state-owned enterprise carriers like EK, SQ, EY, TK, CX, etc. seem to be the only ones with the "tremendous" service and amenities and outrageous suites--with LH being the biggest exception. That says tons about LH and what it is able to do as a true private enterprise, and it reflects the challenges with other private enterprise carriers like UA, DL, AA, BA, AF, and the like in competing with those state-owned enterprises. It's easier for more authoritarian states like Thailand, China, UAE, and Singapore to build airports where and how they want compared with the industrialized and more democratic West, and it's easier IMO for those state-owned enterprise carriers to implement more fabulous offerings without the same profit concerns as their counterparts in the West, too.
Aug 29, 2014 | 2:17 am
#78
Ambassador: Emirates Airlines
Join Date: Sep 2004
Location: Manchester, UK
Posts: 19,801
Aug 29, 2014 | 3:40 am
#79
Join Date: Nov 2013
Posts: 5,482
- a low/no tax state, which allows them to offer attractive salary and benefit packages (as regulars on this board know, it's basically, free accommodation and living costs) which reduces their cost of labour compared to other carriers
- as EK lease the vast majority of their aircraft, the interest rate they pay is the best in the market considering EK's financial position (healthily profitable) and implicit debt guarantees from the emirate of Dubai
The subsidy that people imply is generally fuel - which actually isn't subsidised at all. In fact, if you look at the recent financial history of Dubai, EK actually contributed to the Dubai treasury during their recent problems I think...
The other benefit is the 30 odd percent discount they get on their widebodies, which I would assume is at the top end that Airbus and Boeing offer considering EK's purchase power.
Aug 29, 2014 | 3:45 am
#80
Join Date: Sep 2013
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DYKWIA - I suspect you will wait a long time for such proof.
It's a very common myth amongst many travellers with limited/zero first-hand experience of Emirates, and the part of the world in which they are based, that the airline is heavily subsidised - or even totally state-funded. I think the myth gets peddled around as the result of a misguided belief that it must be, surely ....I mean ...... with all that money they've got out there .......
My own understanding, having previously spent some years living in the region, is that in the early days of its inception & initial development, the airline did indeed receive significant 'state support'. However, the intention all along was that it would stand on its own feet, and the clearest indication that the transition to a conventional commercial operation had been successfully completed was the first publication (can't quote the actual year) of fully-audited company accounts & reports, a practice which of course has continued ever since. State-run industries are not in the habit of providing Annual Reports for public consumption .....!
One qualification I would add - and this more by way of an educated assumption than any sort of 'inside knowledge' - is that if by chance EK ever got itself into serious, 'life-threatening' difficulties, then those holding the reins of power in Dubai would not wish to see their flag carrier fail. Given the airline's ongoing level of success, such protection seems unlikely to be needed ; but I'd bet my mortgage that it would be there.
It's a very common myth amongst many travellers with limited/zero first-hand experience of Emirates, and the part of the world in which they are based, that the airline is heavily subsidised - or even totally state-funded. I think the myth gets peddled around as the result of a misguided belief that it must be, surely ....I mean ...... with all that money they've got out there .......
My own understanding, having previously spent some years living in the region, is that in the early days of its inception & initial development, the airline did indeed receive significant 'state support'. However, the intention all along was that it would stand on its own feet, and the clearest indication that the transition to a conventional commercial operation had been successfully completed was the first publication (can't quote the actual year) of fully-audited company accounts & reports, a practice which of course has continued ever since. State-run industries are not in the habit of providing Annual Reports for public consumption .....!
One qualification I would add - and this more by way of an educated assumption than any sort of 'inside knowledge' - is that if by chance EK ever got itself into serious, 'life-threatening' difficulties, then those holding the reins of power in Dubai would not wish to see their flag carrier fail. Given the airline's ongoing level of success, such protection seems unlikely to be needed ; but I'd bet my mortgage that it would be there.
Aug 29, 2014 | 5:00 am
#81
Ambassador: Emirates Airlines
Join Date: Sep 2004
Location: Manchester, UK
Posts: 19,801
DYKWIA - I suspect you will wait a long time for such proof.
It's a very common myth amongst many travellers with limited/zero first-hand experience of Emirates, and the part of the world in which they are based, that the airline is heavily subsidised - or even totally state-funded. I think the myth gets peddled around as the result of a misguided belief that it must be, surely ....I mean ...... with all that money they've got out there .......
My own understanding, having previously spent some years living in the region, is that in the early days of its inception & initial development, the airline did indeed receive significant 'state support'. However, the intention all along was that it would stand on its own feet, and the clearest indication that the transition to a conventional commercial operation had been successfully completed was the first publication (can't quote the actual year) of fully-audited company accounts & reports, a practice which of course has continued ever since. State-run industries are not in the habit of providing Annual Reports for public consumption .....!
One qualification I would add - and this more by way of an educated assumption than any sort of 'inside knowledge' - is that if by chance EK ever got itself into serious, 'life-threatening' difficulties, then those holding the reins of power in Dubai would not wish to see their flag carrier fail. Given the airline's ongoing level of success, such protection seems unlikely to be needed ; but I'd bet my mortgage that it would be there.
It's a very common myth amongst many travellers with limited/zero first-hand experience of Emirates, and the part of the world in which they are based, that the airline is heavily subsidised - or even totally state-funded. I think the myth gets peddled around as the result of a misguided belief that it must be, surely ....I mean ...... with all that money they've got out there .......
My own understanding, having previously spent some years living in the region, is that in the early days of its inception & initial development, the airline did indeed receive significant 'state support'. However, the intention all along was that it would stand on its own feet, and the clearest indication that the transition to a conventional commercial operation had been successfully completed was the first publication (can't quote the actual year) of fully-audited company accounts & reports, a practice which of course has continued ever since. State-run industries are not in the habit of providing Annual Reports for public consumption .....!
One qualification I would add - and this more by way of an educated assumption than any sort of 'inside knowledge' - is that if by chance EK ever got itself into serious, 'life-threatening' difficulties, then those holding the reins of power in Dubai would not wish to see their flag carrier fail. Given the airline's ongoing level of success, such protection seems unlikely to be needed ; but I'd bet my mortgage that it would be there.
The initial set up was funded by the Dubai government, and it consisted of 2 (I think) aircraft.
I also agree that the Dubai government would step in to prop up EK if it had financial difficulties. A bit like what happens when US airlines have financial difficulties (Chapter 11)
Aug 29, 2014 | 10:36 am
#82
Join Date: Jan 2000
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Aug 29, 2014 | 1:51 pm
#83
Join Date: Jun 2012
Location: 30,000ft
Programs: EK, BA, EY, SQ, IHG, HH, SPG
Posts: 670
'Is Flying First Class Doomed?'
There are no implicit guarantees anymore in Dubai. The banks made the mistake of assuming this in '08. As a result the banks lend at market rates to EK with no sovereign guarantee. I also tend to believe the only subsidies are indirect eg salary cost lower. EK is profitable in its own right. Dubai of all places would never subsidise such a large enterprise as it would not make sense to a place with no huge oil and gas income.
Aug 30, 2014 | 4:42 pm
#85
Join Date: Jun 2012
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'Is Flying First Class Doomed?'
No it's owned by ICD a government entity. The same as Dubai World which if you remember during the crisis did not receive any automatic guarantee on its debts and went through a restructuring process as did nakheel. Sovereign guarantees are explicit not implicit. There many other examples.
Aug 30, 2014 | 5:29 pm
#86
Join Date: Aug 2014
Posts: 184
Arguments on StATE fINANCED OR NOT..i CAN'T BELIEVE THAT EITHER OF YOU HAVE PROOF ONE WAY OR ANOTHER.
I have not seen their balance sheets....can you tell me who actually owns the airline ? Where did the $$$ come from for the capitalization and continuing expansion?
It is the flag carrier,its sucess at any rate is paramont to Dubai Govt. $$$ invested, new airport,"excess " personnel but very importantly PRIDE.
I have not seen their balance sheets....can you tell me who actually owns the airline ? Where did the $$$ come from for the capitalization and continuing expansion?
It is the flag carrier,its sucess at any rate is paramont to Dubai Govt. $$$ invested, new airport,"excess " personnel but very importantly PRIDE.
Aug 30, 2014 | 11:37 pm
#87
FlyerTalk Evangelist
Join Date: Dec 2009
Programs: UA, LY
Posts: 13,179
No it's owned by ICD a government entity. The same as Dubai World which if you remember during the crisis did not receive any automatic guarantee on its debts and went through a restructuring process as did nakheel. Sovereign guarantees are explicit not implicit. There many other examples.
Originally Posted by Emirates.com
Though wholly owned by the Government of Dubai
Aug 31, 2014 | 2:15 am
#88
Join Date: Jun 2012
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Aug 31, 2014 | 8:03 am
#89
Join Date: Jun 2012
Programs: BA Gold, EY Gold.
Posts: 283
RE Emirates. Let's look at what we know to be fact.
It is 100% owned by a govt holding company.
Dubai is running out of oil. Emirates is INTEGRAL to the government of Dubai to stimulate the tourism industry and has really helped put Dubai on the world map.
You cannot put oil into a planes fuel tanks. Emirates needs to buy jet fuel like every other airline.
Emirates biggest advantage is perhaps that the Dubai government is extremely PRO aviation. It has a geographical advantage. It has a HUGE advantage in that it's hub operates 24/7 allowing Emirates to get much more utlisation out of their staff and aircraft than those operating from night restricted hubs in europe and much of the western world.
Emirates doesn't have the western world corporate problems of contributing to pension funds for staff. Negotiating with unions. Paying staff while they are off on long term sick or maternity/paternity leave. If you are crew for emirates and get pregnant or get cancer - you are on the next plane back to your home country.
It is 100% owned by a govt holding company.
Dubai is running out of oil. Emirates is INTEGRAL to the government of Dubai to stimulate the tourism industry and has really helped put Dubai on the world map.
You cannot put oil into a planes fuel tanks. Emirates needs to buy jet fuel like every other airline.
Emirates biggest advantage is perhaps that the Dubai government is extremely PRO aviation. It has a geographical advantage. It has a HUGE advantage in that it's hub operates 24/7 allowing Emirates to get much more utlisation out of their staff and aircraft than those operating from night restricted hubs in europe and much of the western world.
Emirates doesn't have the western world corporate problems of contributing to pension funds for staff. Negotiating with unions. Paying staff while they are off on long term sick or maternity/paternity leave. If you are crew for emirates and get pregnant or get cancer - you are on the next plane back to your home country.
Aug 31, 2014 | 8:24 am
#90
Ambassador: Emirates Airlines
Join Date: Sep 2004
Location: Manchester, UK
Posts: 19,801
RE Emirates. Let's look at what we know to be fact.
It is 100% owned by a govt holding company.
Dubai is running out of oil. Emirates is INTEGRAL to the government of Dubai to stimulate the tourism industry and has really helped put Dubai on the world map.
You cannot put oil into a planes fuel tanks. Emirates needs to buy jet fuel like every other airline.
Emirates biggest advantage is perhaps that the Dubai government is extremely PRO aviation. It has a geographical advantage. It has a HUGE advantage in that it's hub operates 24/7 allowing Emirates to get much more utlisation out of their staff and aircraft than those operating from night restricted hubs in europe and much of the western world.
Emirates doesn't have the western world corporate problems of contributing to pension funds for staff. Negotiating with unions. Paying staff while they are off on long term sick or maternity/paternity leave. If you are crew for emirates and get pregnant or get cancer - you are on the next plane back to your home country.
It is 100% owned by a govt holding company.
Dubai is running out of oil. Emirates is INTEGRAL to the government of Dubai to stimulate the tourism industry and has really helped put Dubai on the world map.
You cannot put oil into a planes fuel tanks. Emirates needs to buy jet fuel like every other airline.
Emirates biggest advantage is perhaps that the Dubai government is extremely PRO aviation. It has a geographical advantage. It has a HUGE advantage in that it's hub operates 24/7 allowing Emirates to get much more utlisation out of their staff and aircraft than those operating from night restricted hubs in europe and much of the western world.
Emirates doesn't have the western world corporate problems of contributing to pension funds for staff. Negotiating with unions. Paying staff while they are off on long term sick or maternity/paternity leave. If you are crew for emirates and get pregnant or get cancer - you are on the next plane back to your home country.