Gulf airlines in 2017: Etihad cuts capacity 4% as Emirates and Qatar begin slowest growth in 5 years
For the first time in over a decade, a Gulf superconnector airline will reduce its annual capacity. Etihad is forecast to cut ASKs by 4% in 2017. Emirates and Qatar Airways will have their slowest growth expansion in a decade, but in terms of net capacity addition 2017's production increase is the slowest in about five years.
Etihad is contracting in all regions except Western Europe and Australia in 2017. The largest cuts will be in South America, North America and Southeast Asia, although this does not necessarily correlate to regional profitability. Despite the reduction Etihad's frequencies will be up 1% in 2017, mostly in Western Europe and South Asia.
Etihad has announced plans to reduce staff members, which it says will be largely through attrition. As it contracts instead of growing, its aircraft commitments – and in particular 787s – may be cancelled or deferred. Etihad's partnership with Lufthansa will result in its airberlin burden being reduced. Etihad may look to sell down European investment airlines, according to unconfirmed press reports.
Yet as Etihad recalibrates under a changed Abu Dhabi government, Qatar Airways continues to grow.
Become a CAPA Member to access Analysis Reports
Our Analysis Reports are only available to CAPA Members. CAPA Membership provides exclusive access to in-depth insights on the latest developments in the aviation and travel industry, developed by our team of dedicated analysts located in Europe, North America, Asia and Australia.
Each report offers a fresh perspective on the latest industry trends and is available online or via the CAPA mobile app, with customisable alerts to help you stay informed and identify new business opportunities.
CAPA Membership also provides access to our full suite of tools, including a tailored selection of more than 400 News Briefs every weekday and comprehensive data and analysis on thousands of companies around the world.