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The ‘Emirates Effect’ – Part 2

4-Nov-2005

SYDNEY (Centre for Asia Pacific Aviation) - Last week in Asia Pacific Airline Daily, we described the impact the powerful Emirates/Dubai Airport combination was having on competition for certain Asia Pacific and European carriers. But another key component of the ‘Emirates Effect’ is the psychological impact it is having on global carriers.

Last year, Air France Chairman/CEO, Jean-Cyril Spinetta, publicly called on Emirates to “open its accounting books”, to help Air France “understand [its] business model and enable us to implement the same plan”.

Yesterday, in response to Emirates’ request for Australian Government approval to double weekly frequencies to Australia, Qantas Chairman, Margaret Jackson stated the proposal was “not only extravagant, but flies in the face of fair competition”. The statement comes ahead of a policy decision on international aviation access by the Australian Government. Ms Jackson’s timing indicates a decision is imminent.

With 93 aircraft on order worth USD30 billion, including 45 A380s, Emirates’ competitive and psychological warfare is only set to intensify, not only for Qantas, but other major hub carriers like Singapore Airlines, Thai Airways, Air France and Lufthansa.

“To suggest that Emirates is competing on similar terms as commercially-run airlines like Qantas is, quite frankly, fiction. As Qantas has observed before, life must be wonderfully simple when the airline, Government and airport interests are all controlled and run by the same people. It is time that Emirates acknowledges that it enjoys significant advantages that help set it apart from the field”, stated Qantas' Chairman Margaret Jackson.

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