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-   -   Is Emirates a financial scam? (https://www.flyertalk.com/forum/emirates-skywards/1627541-emirates-financial-scam.html)

FD1971 May 23, 2015 2:20 am


Originally Posted by sunseeker (Post 24855634)
dietrich,
whatever that's supposed to mean is beyond me....
:confused:

Dein Bruder im Geiste, Yuropflyer...


Originally Posted by iahphx (Post 24856230)
I was a foreign affairs major in college (a long time ago) and at that time we studied the media in the Soviet Union. I find a disturbing similarity between the press in the UAE and the press in the USSR.

Absolutely, hence my comparisons to the GDR and the SED back in the days.

They simply did not allow certain things to be part of the GDR and used their media to confirm just that. And every critical comment about the viability of the next five year plan was denounced as Western Propaganda.

Indeed, you find a lot of similarities in this thread and in recent publications from the Gulf.


Originally Posted by cargueiro (Post 24856592)
LAD is so unviable as a destination it has to have a 3 x weekly private charter, 747 - mainly biz class, by 5Y!

(Delta did waste a lot of money trying to open at LAD circa 2009/2010)!

A 3/7 private charter should not be compared with real airline operations.

Quite often, companies argue that the time savings are well worth it to have those flights.

Delta learned it the hard way a few years ago. Most of their routes turned out to be far more difficult than originally expected.

And there is another main difference between the ME3 and airlines from the US and EU in those markets.

Corruption is a major issue. EK can simply pay everyone they have to have in order to make it work locally, Compliance is probably not a real issue and even if it would be a topic, a nephew of the owner would take care of it. @:-)

The US3 and EU airlines are simply subject to completely different laws regarding transparency and Compliance and would have a far more difficult time... ;)


Originally Posted by moondog (Post 24857943)
Cool. Can we agree that it's in the best interests of the public to let the game run its course?

The case is pretty clear, the arguments have been presented by the US3, so I really do not understand why the apologists and fans continue to argue against it.

Maybe, you can update us with further info, but as pointed out numerous times before, finding arguments to explain $44 Billion will be difficult (but probably entertaining at the same time)


Originally Posted by cargueiro (Post 24857648)
If you are a former journalist I am surprised you think The Economist is a magazine - it is a newspaper and is also quite popular!

The Economist is certainly a trustworthy publication, but you can compare some of the pieces with the rants by Krugman in the NYT, highly subjective opinion pieces based on his personal beliefs in Economics

I consider them to be entertaining, I consider them to be written for a certain audience, but that's about it. It is one opinion about Germany's Energiewende and that's about it, to give one recent example from April 2015.

There is absolutely no doubt that the ME3 are connecting parts of the world and that many people prefer good inflight service and low fares to the exact opposite, an old LH 744 or DL 763 (some of them are actually from the Gulf region, IIRC) not to mention state of the art airport infrastructure in some of the older parts at Heathrow, Gatwick, CDG or Frankfurt.

Dubai Duty Free does the rest and as pointed out before, several VP of Emirates pointed out numerous times that they wanted to copy Pan Am, SQ/Changi and of course, Schiphol.

But this is not the question we discuss since months. The question is whether you can make money flying a passenger from DFW to Lagos at a very competitive fare to use the example of the poor guy who caused the emergency landing at WAW.

Unfortunately, they did not state the number of passengers onboard, but other pieces completed the usual story; super low fare appealing to the backpackers, high operating costs due to detours, ultra long haul flights, so under the bottom line not too many factors going in the right direction.

Did I mention Cargo?

No.

Did Clark mention Cargo?

Oh yes, complaining about the fact that the Indians travel with too many bags hence reducing the payload even further.

And before some people demand a source, AFAIR; it was in Airline Business.

Is it conclusive evidence?

No, but more than enough for the educated reader to get an idea how certain parts of the network perform financially. Add the debt of Dubai and EK, take a closer look how both increased since the turn of the Century and you get a pretty good picture about the financial viability of the idea of becoming a Superconnector.

moondog May 23, 2015 2:24 am


Originally Posted by FD1971 (Post 24857920)
To be entirely honest with you, I simply do not find the time to spend more than 10-15 seconds on almost all replies, so only briefly scanned your first post including the red passages for a few seconds.

The reason, aside from time, is simple, there is nothing new and interesting for me anyway, since I know most of the people and read most of the publication hence know the vast majority of their opinions. As pointed out before, Mr. de Wit is spending a lot of time in Germany and the case of the ME3 and Emirates is actually pretty obvious. @:-)

Cool. Can we agree that it's in the best interests of the public to let the game run its course?

ckx2 May 23, 2015 2:56 am

Gosh. This thread ist _still_ a thing? And OP is still arguing on his own business minded level?

GUWonder May 23, 2015 3:35 am


Originally Posted by FD1971 (Post 24857920)
To be entirely honest with you, I simply do not find the time to spend more than 10-15 seconds on almost all replies, so only briefly scanned your first post including the red passages for a few seconds.

The above post paragraph is much like this thread: from how it starts to indictating how and why it continues as it does.

By the way, honestly, I didn't realize we all unwittingly relied upon messed-up clocks. ;)

FD1971 May 23, 2015 3:45 am


Originally Posted by GUWonder (Post 24858068)
The above post paragraph is much like this thread: from how it starts to indictating how and why it continues as it does.

Indeed, one of the downsides of such boards and especially people who post all day long about a profession they only know from the stands...and slopes. :D:D:D

GUWonder May 23, 2015 3:51 am

Compliance and transparency are wonderful in the US and EU? There is plenty of evidence to doubt that it's so great in practice when it comes to the interests of investors/consumers/creditors.


Originally Posted by FD1971 (Post 24858079)
Indeed, one of the downsides of such boards and especially people who post all day long about a profession they only know from the stands...and slopes. :D:D:D

Airlines aren't a profession. Nor is Emirates.

[Skiing, that is another thing. :D However, shooting wild pigs in the neighborhood is mere recreation; and, in the absence of wolves, they are easier than before to get at. :D]

Relegating one's self to be an aviation industry professional is sort of financially pitiful -- just not pitiful in the way of that German "professional" who crashed the Germanwings flight into the mountains of SE France after Lufthansa supported his profession. Would it have been a scandal if EK had the misfortune of trusting Lufty over him? Or would it just be a scam?

FD1971 May 23, 2015 3:56 am


Originally Posted by GUWonder (Post 24858093)
Airlines aren't a profession. Nor is Emirates.

Skiing, that is another thing. :D

I wasn't referring to Emirates or airlines in general.

I was referring to your post from yesterday that you know nothing about Fleece Shirts.:p

Please, do not get me started commenting on your posts about airlines or Emirates. ;)

eternaltransit May 23, 2015 4:32 am


Originally Posted by iahphx (Post 24856939)
Of course I'm familiar with the Economist -- it's a boring English-based magazine that few people actually read. But it's usually known for higher quality articles than this piece, which is substance-free. There have been published allegations that the ME3 "buys off" European journalists with perks. I have no personal knowledge whether that's true. But if this guy didn't get bought off, he should have! You'd find better journalism in a fan magazine (and btw, I used to be a journalist, too, who worked for a competitor of the Economist, so I know a little about that subject, too).

Whether it is boring or not is neither here nor there and has no bearing on its journalism. As stated, the Economist writes from a position which promotes the ideas of classical liberal economics, and therefore free trade, over things such as state capitalism.

Have you read the article? Because it doesn't actually cheer one way or the other - it simply gives a recap of what's been going on in the past few months. As you may know, the Economist isn't really a polemicist publication (except of course, in certain circumstances, this one not being one of them) - and that article isn't cheering from the stands one way or another.

Insinuating that there has been corruption simply because you disagree with what you think has been said is rather unfair and quite similar to the attacks against EK - I think your case would be strengthened by going through the article and telling us why the authors are incorrect and debunking any of their statements?

DYKWIA May 23, 2015 4:33 am

Can this thread be put out of its misery once the poll reaches 100?

It's beyond tedious...

eternaltransit May 23, 2015 4:38 am


Originally Posted by iahphx (Post 24856993)
They are a lobbying organization, not a supposedly independent media outfit. Tremendous difference, of course.

BTW, don't knock Mr. Schlappig. His overall work, like that done by many of the popular miles and points blogs, can be better than that of most formal "journalists." That said, Mr. Schlappig appears a little out of his depth on this subsidy thing (it's not really a frequent flyer issue of course), just like Gary at ViewFromtheWing (who seems a little too fond of his free Emirates flights to me).

Indeed - and I don't think anyone expects UAE based media to be independent fearless champions of journalism.

That's why we try not to take their statements at face value without corroborating evidence.

However, media in other jurisdictions also don't get free passes, especially in the U.S. with its massive corporate lobbying industry. If you think that journalists such as those at the Economist can be bought off with free hospitality, then similarly, you must regard all Western media as similarly potentially compromised - or does the issue only come up when articles are written that you don't agree with.

So, what do we do - we read media articles for the perspective, but when evaluating what is and is not possible, we take the most independent data out there, not analysis (as we all know, there are so many opinions-for-hire out there).

Given the independent data says that there is a plausible case for these operations to be profitable under certain conditions, we don't need to rely on media reports to back up any cases.

moondog May 23, 2015 4:39 am


Originally Posted by FD1971 (Post 24857962)
The case is pretty clear, the arguments have been presented by the US3, so I really do not understand why the apologists and fans continue to argue against it.

Maybe, you can update us with further info, but as pointed out numerous times before, finding arguments to explain $44 Billion will be difficult (but probably entertaining at the same time)

Do you agree that it's in the best interests of the public for the game to run its course?

NOIR May 23, 2015 4:45 am

Hans and Franz trying to pump us up with they're girlie man airline economics.:D


eternaltransit May 23, 2015 4:50 am


Originally Posted by FD1971 (Post 24857957)
Corruption is a major issue. EK can simply pay everyone they have to have in order to make it work locally, Compliance is probably not a real issue and even if it would be a topic, a nephew of the owner would take care of it. @:-)

The US3 and EU airlines are simply subject to completely different laws regarding transparency and Compliance and would have a far more difficult time... ;)

Once again, the argument against EK simply becomes "they are from a dodgy jurisdiction I don't like, so I think they are corrupt in all that they do".

It's a rather weak argument - I mean, large German corporates (e.g. Siemens, Deutsche Bahn - who in an attempt to try and investigate it spied on all the employees! have been notorious for global bribery!

Siemens' culture of bribery cost it a 1.6bn USD fine., and another 1bn USD internal overhaul.
Daimler bribing its way to sell cars.
Even LH has subsidiaries that are implicated in bribery.
BA and VS colluded to fix fuel surchages for illegal profit

I'm sure a quick Google search can bring everyone more examples.

But we don't argue that those companies are all scams - just there are some criminals at work inside the organisation.

This idea that EK has to be guilty because it's based in Dubai is just weak and xenophobic.

Far better to argue the point that the running costs of A380s and the fares and yield mix simply don't add up to make a strong case. And to answer sufficiently the questions raised when evaluating the plausibility of off-balance sheet fraud by opaque transactions (if any).

Or is the argument now - everybody is partaking in some sort of corruption, so when EK say they aren't, they must be lying? Even if that were so (an outstation somewhere bribing locals for business), why does that then for EK but not for other companies, then leave them open to the insinuation that the whole thing is a massive scam?

RadioGirl May 23, 2015 4:59 am

So on the one hand, you claim:

Originally Posted by FD1971 (Post 24842462)
But again, isn't it nice that all the backpackers can fly in style instead of relying on the likes of PIA, Biman or even more obscure carriers on their way to Africa trying to climb the Kili?

But on the other hand (in the same post, still referring to the backpackers):

Originally Posted by FD1971 (Post 24842462)
It is great and when they stopover at DXB and go up the Burj, spend some time at a mall and buy some Gold, the subsidies for flying them through DXB on EK might even pay off for Dubai.

The backpackers who are paying (what you claim are) "the cheapest fares" are also buying gold at a level that makes a difference to Dubai's finances? On what planet?

On the one hand you claim:

Originally Posted by FD1971 (Post 24842498)
The 15 hour A380 is not profitable per se with loads in the 80's (well, still better than 59.9% :D ) in case 90% of the people onboard purchased a Y ticket at $1000RT.

and

Originally Posted by FD1971 (Post 24842764)
Are you really surprised that people do not want to hear the truth as long as they can buy a ticket for a really low fare on an airline that seems to be too good to be true...

and

Originally Posted by FD1971 (Post 24842764)
And an A380 without Cargo flying for 15 hours to connect low fare pax to India is not really all about substance, you do not need a degree in Aviation from MIT or Cranfield to figure that out.

And yet on the other hand:

Originally Posted by FD1971 (Post 24842498)
Watch out, if a passengers stops at a gateway for more than x hours, he is counted as a passenger between two markets, despite the fact that he is in transit and just enjoyed a free stopover, which is paid by Emirates or Dubai, DNATA, Dubai World, Dubai Tourism, Dubai Marketing, well, does not really matter , same pocket anyway.

and

Originally Posted by FD1971 (Post 24842533)
At the end of the day, someone has to pay for the free stopover, for the free hotel stays, for the free limo rides etc.

and

Originally Posted by FD1971 (Post 24842764)
Again, it is about substance (financially) not style and showers on an aircraft resulting in debt 2 times the annual GDP...

Since you've clearly never flown on EK, let me help you out here. The "free limo" is only for Business and First, not for the "really low fare" "90% of passengers on the cheapest Y ticket". Since (according to you) hardly anyone flies in EK J or F, there are really very few (possibly no) "free limo" rides paid for (by EK, Dubai or anyone).

If the A380 is 80% full it doesn't even fill economy; same for the B777. Since you continually claim that everyone on EK is paying "really low fares" we can only assume they all fly with J and F empty. So - no limos then.

Secondly, the "free hotel" only applies on limited itineraries (where the only possible transfer requires a stop of more than 8 hours - or 6 hours in J/F but we've just established that no one ever flies J/F on EK) and does not apply even then to the cheapest fares. So, by your logic that everyone is on the cheapest fares, there are no free hotel stays.

Thirdly, any "stopover" is free if there is no hotel stay involved. It doesn't cost anyone anything if the passenger spends three hours or three days in Dubai paying their own costs.

Finally - and even you must know this - the "showers" are only for First passengers. Poor people from India paying el cheapo fares don't get anywhere near First.

Oh, look, here you've got both the "low fares" and the mythical limos and free stopovers all in one sentence.

Originally Posted by FD1971 (Post 24842533)
As pointed out before, EK is a very low RASM airline, they are a low fare airline, i.e. because someone has to pay for the limo, for the free stopover, so the fare EK is charging is the sum of more components in comparison to LH, to use just one example.

In fact, the above was in response to Irishguy providing quotes for Economy Class (where EK was far from being the cheapest option). You know, the class without the limo and free hotels.

Summary: "everyone is paying low fares" and "lots of free limos, free hotels, showers" can't both be true. They may both be false, but at most one can be true.

Originally Posted by FD1971 (Post 24842764)
Wow, ...
Are you surprised that people made fun of Lafontaine 25 years ago, when he predicted dire times for Eastern Germany instead of Kohl who predicted the exact difference.

Are you really surprised that some experts came up with a sum totalling 42 or 44 Billion? Do you really believe that such a sum has been taken out of Alice in Wonderland and is pure fiction to be put into a movie by Tim Burton?

Are you really suprised that Bernie Madoff could not really deliver the interest he promised to all his clients?

What do you think happened to a guy asking whether Lehman or Madoff really have substance 10 years ago?

You guessed right, the consensus of the people in the tent was clearly that Lehman was rock solid and that Bernie was simply just an expert at Finance.

Wow: Lafontaine, East Germany, Kohl, Tim Burton, Madoff and Lehman - do you think you can come up with any MORE completely irrelevant references to obfuscate the actual topic of this thread? (It's "is EK a financial scam", in case you've forgotten.)

[Some person] was wrong about [some thing] does not equate to "therefore anyone who disagrees with me is wrong about EK."

Originally Posted by FD1971 (Post 24849037)
The apologists could not find an intern from the Weather Channel, so do not expect them to come up with an expert working for a consultancy or even University researching related content.


Originally Posted by FD1971 (Post 24853141)
And one of your other sources, Vespermann, delivered a pretty poor presentation about EK's growth some years at a conference, well, you guessed right, at Schiphol. It is actually quite funny, because he worked for a private Business School in Germany struggling to break even for years, so quite frankly using him as a source is blooby brilliant. Thank you for that :D

No analysis, just basic reproduction.

Most of your staff you posted look like basic reproduction, I cannot really read comments about subsidies not being received and that EK is clean. De Wit points out what we already know...and what I point out since months...

Vespermann is not really someone worth mentioning, maybe you even find his presentation hold at Schiphol from some years ago...

So: You asked for real research supporting EK, abaca12 provided peer-reviewed research supporting EK, but they don't meet your criteria because - wait for it, they support EK. The only authentic researchers you will accept are the ones who are against the EK3. Sure. :rolleyes:

Originally Posted by FD1971 (Post 24853155)
Considering the amount of migration workers they need in Qatar, AD und Dubai, it is certainly a logical consequence.

Could you alaborate how to make money with the fares those poor guys pay on average.

And this is just racism.

I'm still waiting for you to identify the airlines that fly non-stop between Australia and Germany - I'd pay extra for that.

Enzokk May 23, 2015 5:52 am


Originally Posted by FD1971 (Post 24857962)
The case is pretty clear, the arguments have been presented by the US3, so I really do not understand why the apologists and fans continue to argue against it.

Maybe, you can update us with further info, but as pointed out numerous times before, finding arguments to explain $44 Billion will be difficult (but probably entertaining at the same time)


Are you talking about the US3 White Paper here? Why would you post about $44 Billion if this isn't the amount attributed to EK?

Or are you trying to smear EK with the big amount that is alleged to all three of the airlines? Maybe you have information that EK actually have had $44 Billion of subsidies but you don't want to share it? What is the purpose of that though?

I have another question, you stated that the information is out there for all to see that EK is a scam. This is common knowledge to those in the business, why hasn't those in the know (airlines included I would assume) lobbied their politicians to change the rules to protect their local airlines? Why has it taken 30 years to act? Why now and not 10 years ago when Emirates was starting their expansion efforts? You saw the information all those years ago (again, 10, 15 or 20 years ago?) to confirm that there is no way that the airline isn't subsidised, why has there been no action against them? Seems to me that if it is true what you are telling us, either the politicians aren't protecting their voters in the EU countries, or they are all on the take from EK....:confused:


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