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

avsecman Nov 10, 2014 4:25 pm


Originally Posted by eternaltransit (Post 23821932)

And as for your comment about staff costs being immaterial - I would hardly call the 2nd biggest cost that all airlines, not just EK have being staff costs immaterial. This includes retiree benefits: the fact that retiree obligations at US legacy carriers were a major factor in their bankruptcy (before aCEnd after) I think. is testament to that. The basic fact of airline economics in the past 50 years has shown that labor conditions and therefore costs has been one of the major impediments to profit margin: the success of LCC shows this.

Many years ago (before political correctness), I do remember a US CEO complaining in an inflight mag about Asian carriers like SQ sacking their pretty FAs at around 30. Now is the ME carriers turn...

eternaltransit Nov 10, 2014 4:28 pm


Originally Posted by avsecman (Post 23821998)
Many years ago (before political correctness), I do remember a US CEO complaining in an inflight mag about Asian carriers like SQ sacking their pretty FAs at around 30. Now is the ME carriers turn...

Ah, now they don't do the sacking at 30, what SQ do is when you join, you are given one uniform. That doesn't change in size. Ever....

This isn't a joke btw (at least that was my understanding two years ago).

For comparison, the standard at EK is 3 year rolling contracts (as work permits expire every 3 years in the UAE). However, EK has a high enough turnover of cabin crew for them not to impolitely terminate someone at mid 30s for being too old - or at least, it doesn't seem to be the norm - most younger staff at ME airlines I think leave in their 30s for another career/actual career.

avsecman Nov 10, 2014 5:05 pm


Originally Posted by eternaltransit (Post 23822012)
Ah, now they don't do the sacking at 30, what SQ do is when you join, you are given one uniform. That doesn't change in size. Ever....

My GF is over 40 but they still weigh her to make sure she fits her uniform when required. Keeps her on her toes and slim for me! She is not EK or QR.

ukdoctor Nov 10, 2014 5:11 pm


Originally Posted by iahphx (Post 23821748)
Thanks for the comments. But I remain 100% convinced that Emirates could not make money flying these flights from the USA. Dubai is simply an illogical connecting points for most destinations from the USA. As I said, the only major connecting market is India. Otherwise, the geography is simply wrong.

The population of Dubai is only 2 million -- about the same as Budapest which, to my knowledge, has zero nonstop flights to the USA from ANY city. On "real economics" -- the economics that would apply to a USA airline -- MAYBE this flight would work from NYC. That's about it.

Emirates does not partner with any of the 3 world alliances. That would cause most American businessmen to fly other airlines. There would also be a natural booking away from Middle East airlines: indeed, while I would appreciate the service on Emirates, I honestly wouldn't be looking for a reason to fly them to connect to someplace else. I think at least 95% of Americans would feel the same (and probably the majority of high elite status USA frequent flyers).

The vast majority of the cost of this route would be aircraft and fuel. I don't care what they pay their staff -- it would be largely immaterial.

There is obviously squirrelly mathematics going on with these Middle East airlines. If the rest of the world operated like this, there would be several dozen of A380 flights from the USA to Europe every day. This level of service doesn't exist because no one is picking up the tab for it.

Comparing Dubai with Budapest is like comparing apples with oranges. Out of the over 2 million people living in Dubai , close to 90% AFAIK are expats. Obviously not everyone is in a cushy job , but even the workers in manual labour travel every year or so.

Moreover quite a few residents of the other GCC countries in the region prefer to connect via DXB since they prefer emirates over their flag carriers.

ashkale Nov 10, 2014 5:15 pm

Adding to an already excellent analysis by CaptainEKAirbus and eternaltransit:
Just so you know that EK is considered the official airlines of...India. The vast amount of westward traffic from the subcontinent, alone is enough for them to keep filling these A380s. It was a huge opportunity lost for several Asian carriers , including SQ/MH/TG.

avsecman Nov 10, 2014 5:36 pm


Originally Posted by ukdoctor (Post 23822208)
but even the workers in manual labour travel every year or so.

Some but not all. Some will do several years' before a ticket home, particlarly Bangladeshis and others from umremarkable parts of the world.... Many will earn life changing money... some won't, for some will be a road to nowhere...

iahphx Nov 10, 2014 6:44 pm


Originally Posted by Emirates202 (Post 23821926)
This whole thread is based on your opinion, which you are trying to make sound like facts.

Yes, it's my opinion, but I've worked as an analyst in this industry for decades, and there's nothing like this in the world.

All this blather about "connections" in Dubai is nonsense. Who's making these connections? The number of USA businessmen making connections in Dubai on any given day has got to be tiny. Where are they going to? Nobody in the airline industry has EVER had success running a hub without strong O/D traffic. It's impossible, since you always make most of your money on high value nonstop business travel. This is Airline Economics 101. There is no way that hordes of USA businessmen are going to get off these flights and connect to other destinations. That's beyond fantastical.

I'm sure Emirates attracts plenty of friends and family tourists visiting their home countries, but these tourists traveling on low fares don't pay the bills. And there are only so many sheiks.

I feel bad for an airline like Qantas which obviously suffers geographically from what would otherwise be a good business of shuttling people between Europe and Australia. There is obviously not a real geographical problem for USA airlines as the only real casualty is fewer nonstop flights to India.

Which of course leads to the next obvious question: why are there tons more nonstop flights to the Middle East from the USA than India? It's obviously not because Middle Eastern airlines are better at running their businesses than US airlines, and people prefer to stop. It's because there's something VERY messed-up with the economics of these Middle Eastern airlines. They are wholly different than the economics of any other airlines in the world.

Emirates202 Nov 10, 2014 7:01 pm


Originally Posted by iahphx (Post 23822580)
I'm sure Emirates attracts plenty of friends and family tourists visiting their home countries, but these tourists traveling on low fares don't pay the bills. And there are only so many sheiks.

I already said this but I will say it again. First and business class usually sell out before economy on flights JFK, and I'm sure to other US destinations as well. I can assure you that those of us paying $16K+ for a ticket are not all "friends and family tourists."
If there is no nonstop flights to places like BKK from NY, how do you expect us to get there? Thats where EK plays a huge role. Connecting places where there aren't nonstop flights to.

Wan1dap Nov 10, 2014 7:26 pm


Originally Posted by iahphx (Post 23822580)
Yes, it's my opinion, but I've worked as an analyst in this industry for decades, and there's nothing like this in the world.

All this blather about "connections" in Dubai is nonsense. Who's making these connections? The number of USA businessmen making connections in Dubai on any given day has got to be tiny. Where are they going to? Nobody in the airline industry has EVER had success running a hub without strong O/D traffic. It's impossible, since you always make most of your money on high value nonstop business travel. This is Airline Economics 101. There is no way that hordes of USA businessmen are going to get off these flights and connect to other destinations. That's beyond fantastical.

I'm sure Emirates attracts plenty of friends and family tourists visiting their home countries, but these tourists traveling on low fares don't pay the bills. And there are only so many sheiks.

I feel bad for an airline like Qantas which obviously suffers geographically from what would otherwise be a good business of shuttling people between Europe and Australia. There is obviously not a real geographical problem for USA airlines as the only real casualty is fewer nonstop flights to India.

Which of course leads to the next obvious question: why are there tons more nonstop flights to the Middle East from the USA than India? It's obviously not because Middle Eastern airlines are better at running their businesses than US airlines, and people prefer to stop. It's because there's something VERY messed-up with the economics of these Middle Eastern airlines. They are wholly different than the economics of any other airlines in the world.

You imply that, because you are not capable of making sense of it, it must be a scam. Interesting approach...

Dave Noble Nov 10, 2014 8:12 pm


Originally Posted by Wan1dap (Post 23822767)
You imply that, because you are not capable of making sense of it, it must be a scam. Interesting approach...

Well....

It isn't doing what US carriers do
Obviously everything that the US does must be the best and only right way
therefore EK must be running a scam

Simples

iahphx Nov 10, 2014 8:24 pm


Originally Posted by Wan1dap (Post 23822767)
You imply that, because you are not capable of making sense of it, it must be a scam. Interesting approach...


Originally Posted by Dave Noble (Post 23822948)
Well....

It isn't doing what US carriers do
Obviously everything that the US does must be the best and only right way
therefore EK must be running a scam

Simples

I am certainly not the only one who thinks this is fishy. I mean, guys, it's OBVIOUSLY fishy. There are only a total of 7.5 million people in these 3 countries and they're running some of the biggest global airlines in the world. There are no other airlines that operate like this is the world -- even in countries with large populations and sophisticated economies. Why would you think it's not fishy? Are these Middle Eastern countries known for their financial prowess? No -- they're known for ridiculous oil wealth and ridiculously wealthy non-democratic rulers. Which is obviously what this is about. Just be glad that whatever business you're in you don't have to compete with "companies" such as these.

http://online.wsj.com/articles/SB100...41732219208604

Firemansam Nov 10, 2014 8:40 pm

I have to agree with others, as a so called analyst of airlines your opinion of Emirates and ME3 comes across as incredibly narrow minded and because it does not make sense to you that they are successful where others fail that something must be "fishy".

My question is do you have any hard evidence or factual information to back up your opinion?

ashkale Nov 10, 2014 8:47 pm


Originally Posted by iahphx (Post 23822993)
I am certainly not the only one who thinks this is fishy. I mean, guys, it's OBVIOUSLY fishy. There are only a total of 7.5 million people in these 3 countries and they're running some of the biggest global airlines in the world. There are no other airlines that operate like this is the world -- even in countries with large populations and sophisticated economies. Why would you think it's not fishy? Are these Middle Eastern countries known for their financial prowess? No -- they're known for ridiculous oil wealth and ridiculously wealthy non-democratic rulers. Which is obviously what this is about. Just be glad that whatever business you're in you don't have to compete with "companies" such as these.

http://online.wsj.com/articles/SB100...41732219208604

And now you are trolling..werent you the famous financial analyst at Red Neck inc?

iahphx Nov 10, 2014 8:48 pm


Originally Posted by Firemansam (Post 23823050)
My question is do you have any hard evidence or factual information to back up your opinion?

The same evidence as Delta airlines CEO Richard Anderson: the numbers simply don't add up in the real world. It's not possible for these airlines to make money flying these routes. I challenge you to find me one major USA airline analyst who says it is possible. Mind you, almost all of the "high service" airlines in the world struggle to make money. "Real" airlines like Singapore are barely break even. And they have plausible business plans. There is NOTHING plausible about flying A380s to America from the Middle East. Nothing.

Wan1dap Nov 10, 2014 8:52 pm


Originally Posted by iahphx (Post 23822993)
I am certainly not the only one who thinks this is fishy. I mean, guys, it's OBVIOUSLY fishy. There are only a total of 7.5 million people in these 3 countries and they're running some of the biggest global airlines in the world. There are no other airlines that operate like this is the world -- even in countries with large populations and sophisticated economies. Why would you think it's not fishy? Are these Middle Eastern countries known for their financial prowess? No -- they're known for ridiculous oil wealth and ridiculously wealthy non-democratic rulers. Which is obviously what this is about. Just be glad that whatever business you're in you don't have to compete with "companies" such as these.

http://online.wsj.com/articles/SB100...41732219208604

Wow, now we've moved into the realms of sweeping, unfounded generalisations. Based on your population analogy, then SIA and Cathay must be "fishy" because they're based in small countries. Oh, and they're not American either, so that confirms it.


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