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

irishguy28 May 27, 2015 6:21 am


Originally Posted by FD1971 (Post 24875093)
We have to give Clark the same credit we give contributors like Irish or eternal here on FT.

They continue to fight the obvious truth and invest a lot of time and effort, which is always adorable, at least in my book. ^

Thanks for the thumbs up!

Meanwhile, your posts make you look rather fanciful, given your obsession with Cannondales, Fleece Shirts, Ryanair, and Dortmund airport. Either that, or there's a whiff of a wandering, unsteady focus.



Originally Posted by FD1971 (Post 24875093)
Maybe, we should ask Clark to define the idea behind granting airlines 5th and 6th freedom rights...this could explain why the biggest airlines on the planet do not serve Dubai from a giant market like Chicago, which is also a giant hub for both of them.

Because the "biggest airlines on the planet" are renowned for opening routes, right?

If by "biggest airlines on the planet" you mean American, then you know they partner with Etihad (and Qatar) rather than Emirates. In fact, AA is considering starting its own flights to AUH, and it this month quietly changed its FFP to allow unrestricted mileage earning on Etihad (the restriction to booking AA codeshares on EY is gone), and now places a codeshare on numerous QR and EY routes.


Originally Posted by CAPA
On its website Etihad lists all the US connections it can offer via American that include approximately 15 from Los Angeles, two from Washington DC, roughly 24 from Dallas/Fort Worth and more than 90 from Chicago O’Hare.

During the high level panel debate at CAPA's Americas Aviation summit in Las Vegas examining the nature of the threat posed by Gulf airlines, Etihad general counsel and company secretary Jim Callaghan offered a real example of the opportunities Gulf airlines offer to US airlines. On a flight to Los Angeles operated by an Etihad Boeing 777 with a 225 seating capacity and 215 passengers on board, passengers from 18 destinations joined the flight at Etihad’s hub in Abu Dhabi.

Only two of those destinations are served by US airlines, he stated. Roughly 31 of those passengers transfer to US domestic airlines, including US majors, said Mr Callaghan


<snip>

Delta's announcement of Orlando-Sao Paulo service restores US long-haul service to Orlando, but to Sao Paulo – a route that will not connect to the markets Emirates will. Delta's announcement comes only after Azul enters the Orlando market, suggesting a level of inertia from the major US airlines in long-haul development.

<snip>

No carrier will offer a non-stop itinerary but Emirates can argue it will offer a better product on overlapping one-stop itineraries while opening a number of one-stop services the US carriers offer with two stops or not at all.

How coincindental that the US carriers open an international route from Orlando only after the announcement of new services from Emirates and Azul...

And it would be just adorable if you would face up to some simple facts. You know well that any O&D demand for Dubai is likely to go to EK rather than any of the US3 - particularly for the cities in the US already connected directly to Dubai. Until DL and UA get off their high horses and partner up - in the manner that AA is already doing - they will be left incapable of dealing with anything other than O&D pax, as they can offer no further connections to the passengers they bring to Dubai. This is the reason why none of the "biggest airlines in the world" offer direct flights between ORD and DXB.

If you ask me...the wheels are going to come off the "Fair Skies" coalition buggy before they make any decent progress...AA is clearly not as committed to the "cause" as DL or even UA.

knit-in May 27, 2015 6:43 am


Originally Posted by FD1971 (Post 24875075)

Dubai, as pointed out by the US3 more than once, is different, it is such a small market that the natural demand does not exceed much more than a few flights to Europe and India and maybe another few flights to Asia and New York aside from regional connections.

Tell that to Delta, the SECOND largest airline in the world. They fly non-stop to DXB from ATLANTA! United Airlines has a non-stop from IAD to DXB! Everyone's scamming everyone, it seems.

The loudest screams against EK is coming from Delta, and yet you with your claims of credibility (that exists somewhere behind the scenes!) don't think twice before attributing your own conclusion to the US3? You're really not good enough to speak on their behalf.

eternaltransit May 27, 2015 6:44 am


Originally Posted by FD1971 (Post 24875093)
We have to give Clark the same credit we give contributors like Irish or eternal here on FT.

They continue to fight the obvious truth and invest a lot of time and effort, which is always adorable, at least in my book. ^

Maybe, we should ask Clark to define the idea behind granting airlines 5th and 6th freedom rights...this could explain why the biggest airlines on the planet do not serve Dubai from a giant market like Chicago, which is also a giant hub for both of them.

I am also, like irishguy28 not above taking some internet thumbs ups :D

I unfortunately have quite a few things to do today, but did want to point out that if the truth was so obvious, why have these rumblings been going on for years and years with no definitive investigation or proof offered and with every allegation able to have a plausible, non-suspicious reply or debunked by independent statistics?

In reply to 2322 (wow, 2322...!), there is no doubt, to use a popular phrase around here :), that EK, like many major (every major) airlines around the world, or should we say, like most major corporations, benefitted from government spending - e.g. public construction of airports, highways, transport infrastructure, regeneration projects to attract people to fly to an airport, industrial zones and favourable tax regimes to attract investment, or even in Dubai's case, the parallel funding of a major tourism and leisure industry from scratch.

The point is, we aren't talking about all of that - that isn't subsidy, it's just government spending, as is their right. That can't be the definition of scam because then every company in the world is a scam, and clearly we don't think every company in the world is being subsidised (unless you're a staunch economic libertarian). In fact, governments don't even invest just to get their money back through tax revenue, they do it to promote the well-being of their citizens through economic growth.

But that is an aside. The point here is that why in the case of EK is all of this (its owner's debt levels, government spending on infrastructure) then extended to allege that EK was and is falsifying its accounts, losing hundreds of millions from operations, and is somehow more dishonest than every other airline in the world (deliberately and brazenly lying in public statements for decades) - even when, given its owners financial situation (a budget deficit or slight surplus, tax take of c. 13% of GDP of 88 billion USD, debt levels due to real estate projects in the 80-100% of GDP range) and the extent of the conspiracy required (globally and domestically) executing the plan would be highly difficult (EK is quite dependent financially on external to the UAE creditors, it has many international suppliers) and even though you can construct models where EK can be operationally profitable, models whose conditions are actually satisfied in the real world, according to independent data? That makes the illicit funding hypothesis less the obvious truth but entering the realms of the paranoid conspiracy-theorist.

Just because it's been difficult to achieve something in the past, doesn't mean it's totally impossible, especially when the conditions in the past are not the same as the present.

This is really the question that is never engaged with. Why is it impossible to make money from ops (answer: it's not, as shown in the first hundred or so posts in this thread) and how would EK get away with it for so long? The secondary question is - why do we hold EK to a different standard of proof than other companies? I thought the way things were in the 21st century was that allegations have to be proved, not defendants having to satisfy the accusers to some arbitrary standard...that kind of thinking was popular in the 17th century but did lead to some rather major political upheavals due to the obvious potential for abuse...

knit-in May 27, 2015 7:00 am


Originally Posted by eternaltransit (Post 24875379)

But that is an aside. The point here is that why in the case of EK is all of this (its owner's debt levels, government spending on infrastructure) then extended to allege that EK was and is falsifying its accounts, losing hundreds of millions from operations, and is somehow more dishonest than every other airline in the world (deliberately and brazenly lying in public statements for decades) - even when, given its owners financial situation (a budget deficit or slight surplus, tax take of c. 13% of GDP of 88 billion USD, debt levels due to real estate projects in the 80-100% of GDP range) and the extent of the conspiracy required (globally and domestically) executing the plan would be highly difficult (EK is quite dependent financially on external to the UAE creditors, it has many international suppliers) and even though you can construct models where EK can be operationally profitable, models whose conditions are actually satisfied in the real world, according to independent data? That makes the illicit funding hypothesis less the obvious truth but entering the realms of the paranoid conspiracy-theorist.

Just because it's been difficult to achieve something in the past, doesn't mean it's totally impossible, especially when the conditions in the past are not the same as the present.

This is really the question that is never engaged with. Why is it impossible to make money from ops (answer: it's not, as shown in the first hundred or so posts in this thread) and how would EK get away with it for so long? The secondary question is - why do we hold EK to a different standard of proof than other companies? I thought the way things were in the 21st century was that allegations have to be proved, not defendants having to satisfy the accusers to some arbitrary standard...that kind of thinking was popular in the 17th century but did lead to some rather major political upheavals due to the obvious potential for abuse...

That question (in bold above) has been answered already, my friend. It is prejudice. Or as GUWonder said it...


Originally Posted by GUWonder (Post 24858647)
It's clear that xenophobia -- even of the racist variety -- is a major propellant in the hostility directed toward EK. Exploiting and otherwise fostering xenophobic/racist sentiments is part of the strategy of some of EK's competitors. Whether or not such approach is weak depends on what we mean by weak. Such xenophobic/racist approaches to attack EK are weak on logical merits, but they may be effective in some other ways.

There are some anti-Arab and Islamophobic memes that the US3 and EU2/3 seem to be willing to peddle (directly or indirectly) against EK. And they do this despite their own entanglements with the GCC and the fact that EK's employee and management ranks are very diverse and neither very "Arab" nor "Islamic".


rankourabu May 27, 2015 7:06 am

The DL and UA routes to DXB are heavily subsidised by FlyAmerica. Without that subsidy, these flights would not exist, and most pax do not terminate in DXB anyway.

knit-in May 27, 2015 7:19 am


Originally Posted by rankourabu (Post 24875464)
The DL and UA routes to DXB are heavily subsidised by FlyAmerica. Without that subsidy, these flights would not exist, and most pax do not terminate in DXB anyway.

Thank you!^

lokijuh May 27, 2015 7:22 am


Originally Posted by FD1971 (Post 24875075)
Dubai, as pointed out by the US3 more than once, is different, it is such a small market that the natural demand does not exceed much more than a few flights to Europe and India and maybe another few flights to Asia and New York aside from regional connections.

Despite this thesis, and the extensive presence of EK, many airlines do fly to DXB (unlike DOH, which has very little in the way of non-regional flights on airlines other than QR). Multiple reports, such as one by Xinhua/Dow Jones put DXB in the top 20 financial centres globally. Top tier by no stretch of the imagination. But seems to be second tier, alongside the likes of Amsterdam, Boston, Washington, Mumbai etc.

GUWonder May 27, 2015 7:27 am


Originally Posted by XLR26 (Post 24873314)
Emirates CEO isn't too happy with Chicago's Mayor Emmanuel for taking sides in the trade dispute with the big 3 US carriers.

From an article in today's Chicago Tribune:

Emirates Airline President Tim Clark chastised Mayor Rahm Emanuel in a letter for publicly siding with U.S. airlines in a trade dispute without contacting Emirates for its side of the story.

* * *

Clark said Emirates was lobbied more than a dozen times by Chicago officials since 2010 before deciding to start service last year. "Considering we have carried more than 115,000 passengers to your city in less than a year, our partnership seems to be exceeding expectations," Clark wrote.


* * *

"Let me be very clear. As far as Emirates is concerned, the allegations of subsidy are demonstrably false," he wrote.

For example, Clark said in the letter, allegations that Emirates was dumping capacity in the United States — essentially claiming it was flying mostly empty, unprofitable planes to steal market share — are untrue. He said the airline's load factor — how full its planes are — was more than 80 percent both in Chicago and in the U.S. overall. That demand is why Emirates on May 1 began flying a larger plane model, a Boeing 777-300ER, from Chicago, he said. He noted that neither United nor American offers nonstop service from Chicago to Dubai, where Emirates flies.


Full article here:
http://www.chicagotribune.com/busine...526-story.html

Google it to avoid the paywall.

Rahm is a huge corporate and labor money kiss-up. He is always chasing big money for his next campaigns -- whether chasing the money for himself or to promote himself, it doesn't make a difference to him as he uses it to project himself either way. It's been his tell for as long as he has been in this game. Given UA's presence in Illinois/Chicago, he knows the GCC3 mean squat for him relative to the domestic airline and labor union players which have far more money for him. Also, unless RE fell far from the proverbial apple tree, it's to be noted that his father's history includes making racist, anti-Arab comments while this son didn't take the expressed sentiments to task for being racist.


Originally Posted by avcritic (Post 24875171)
Politicians don't side without their own analysis, and it has nothing to do facts.

:D

Let's just say that, given your comment, it's obvious that I know more types of politicians than you do. ;)

Dieuwer May 27, 2015 8:12 am

Tit for tat continues:


“If you don’t allow us to benefit in a small way by bringing us additional flights to the Netherlands, then you should not expect a lot of commercial contracts from our government,” Mr. Al Baker said at a press conference in Amsterdam. “You should never restrict an airline from growing.”
http://www.wsj.com/articles/qatar-ai...cts-1432658546

iahphx May 27, 2015 9:22 am


Originally Posted by DYKWIA (Post 24858170)
Can this thread be put out of its misery once the poll reaches 100?

It's beyond tedious...

Facts can be tedious. Uncovering unfair commercial activity can be tedious.

Sorry.


Originally Posted by eternaltransit (Post 24858209)
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


Originally Posted by Dieuwer (Post 24875738)

It's clear that what's going on here is not exactly "tit for tat."

We now have the CEO of Qatar Airways telling foreign governments that if you don't give us what we want, my country will retaliate against you. It would be like Doug Parker telling a foreign country that if he didn't get the landing slots he wants for AA, the US gov't would cut military support or something. Give me a break. This is absurd. Qatar Airways is not a "business" in any traditional sense of the word.

Meanwhile, we learn today that the US gov't is indicting a bunch of top FIFA officials because they've been collecting millions of dollars of bribes from Qatar.

http://www.cnbc.com/id/102708937

I'm sure the fans will try to argue that what happens at Emirates is "different" from what happens at Qatar. That said, it is now 100% clear that what happens at Qatar is, essentially, a scam -- at least in the sense that they are a front for a country that doesn't play by any Western standards of commercial propriety.

This is much evidence here that Emirates does business in much the same way as its neighbors: specifically, that they fly routes that seem to make no economic sense, and they operate a business model that seems to "work" only in small, authoritarian Middle East nations. I guess you can believe that Dubai is as pure as snow while their sister states are corrupt. And you can also believe in the tooth fairy. It's your choice.

UA1K_no_more May 27, 2015 9:31 am


Originally Posted by iahphx (Post 24876123)
Facts can be tedious.

For some posters, yes. @:-)
Let us know when you develop an interest in using facts instead of unsupported allegations.

We now have the CEO of Qatar Airways telling foreign governments that if you don't give us what we want, my country will retaliate against you. It would be like Doug Parker telling a foreign country that if he didn't get the landing slots he wants for AA, the US gov't would cut military support or something. Give me a break. This is absurd. Qatar Airways is not a "business" in any traditional sense of the word.

Meanwhile, we learn today that the US gov't is indicting a bunch of top FIFA officials because they've been collecting millions of dollars of bribes from Qatar.

I'm sure the fans will try to argue that what happens at Emirates is "different" from what happens at Qatar. That said, it is now 100% clear that what happens at Qatar is, essentially, a scam -- at least in the sense that they are a front for a country that doesn't play by any Western standards of commercial propriety.
And how does this relate to EK? You do realize what the thread topic is, right?

This is much evidence here that Emirates does business in much the same way as its neighbors: specifically, that they fly routes that seem to make no economic sense, and they operate a business model that seems to "work" only in small, authoritarian Middle East nations. I guess you can believe that Dubai is as pure as snow while their sister states are corrupt. And you can also believe in the tooth fairy. It's your choice.
Like you said: "Facts can be tedious." You don't have facts; you have allegations.

iahphx May 27, 2015 9:59 am


Originally Posted by avcritic (Post 24875171)
EK continues to show its inability to deal with key foreign political leaders. Chastising Rahm Emanuel is not going to any good, it will definitely do more harm.

Politicians don't side without their own analysis, and it has nothing to do facts.

Anyway, still contemplating between bad lobby firm and EK's ignorance.

I just think it's a cultural difference too far. The way "business" is done in the Middle East is just very different from the way it's done in the USA. They want to join the big leagues, but they're not yet ready to. And maybe they never will be. I think it would be like me moving to Dubai to start a company. I don't think it would go well.

You want to go where? May 27, 2015 10:00 am


Originally Posted by iahphx (Post 24876123)

Meanwhile, we learn today that the US gov't is indicting a bunch of top FIFA officials because they've been collecting millions of dollars of bribes from Qatar.

Let's stick to what is happening specifically with the airlines. Heck, four governors of Illinois have been convicted of corruption. Does that mean that every airline that flies into Chicago is a scam?



Originally Posted by iahphx (Post 24876123)
I'm sure the fans will try to argue that what happens at Emirates is "different" from what happens at Qatar. That said, it is now 100% clear that what happens at Qatar is, essentially, a scam -- at least in the sense that they are a front for a country that doesn't play by any Western standards of commercial propriety.

An effective argument would deal with the substance of the argument (those tedious facts) rather than characterize its opponents. You lose credibility when you characterize your opponents as fans rather than take them seriously.


Originally Posted by iahphx (Post 24876123)
This is much evidence here that Emirates does business in much the same way as its neighbors: specifically, that they fly routes that seem to make no economic sense, and they operate a business model that seems to "work" only in small, authoritarian Middle East nations. I guess you can believe that Dubai is as pure as snow while their sister states are corrupt. And you can also believe in the tooth fairy. It's your choice.

The problem here is again you try to cast aspersions based on questionable parallels. Show us those tedious facts you keep going on about. I am ready to be convinced, but I have not seen a single argument from you that holds any water.

UA1K_no_more May 27, 2015 10:06 am


Originally Posted by iahphx (Post 24876351)
I think it would be like me moving to Dubai to start a company. I don't think it would go well.

Considering your prejudice against anything middle eastern, it's obvious why you would fail.


Meanwhile, we learn today that the US gov't is indicting a bunch of top FIFA officials because they've been collecting millions of dollars of bribes from Qatar.
Nope.
Just another one of your "facts"...

Originally Posted by CNN
[Breaking news update at 11:47 a.m. ET]
"The indictment also alleges that corruption and bribery extended to the 2011 presidential FIFA election, and to agreements regarding sponsorship of the Brazilian national soccer team by a major U.S. sportswear company," U.S. Attorney General Loretta Lynch told reporters in New York on Wednesday while providing details about the U.S. corruption investigation into FIFA officials and others.

[Breaking news update at 11:39 a.m. ET]
FIFA executives and others used bribes to influence where the 2010 World Cup would be held, Lynch told reporters Wednesday while providing details about the U.S. corruption investigation of FIFA. The 2010 World Cup was held in South Africa.
[...]
Original story posted at 9:53 a.m. ET]
[T]he Justice Department announced the unsealing of a 47-count indictment in a federal court in Brooklyn, New York, that detailed charges against 14 people for racketeering, wire fraud and money laundering conspiracy.

http://www.cnn.com/2015/05/27/footba...ent/index.html

knit-in May 27, 2015 10:18 am


Originally Posted by iahphx (Post 24876351)
I think it would be like me moving to Dubai to start a company. I don't think it would go well.

You are a minuscule example of America. Many American businesses are doing very well in Dubai and other parts of the middle east.


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