Equity investment model 'protects and promotes competition': Etihad Airways CEO

Etihad Airways president and CEO James Hogan stated (31-Mar-2016) Etihad Airways' equity investment model created a, "new force in global air travel, which protects and promotes competition." Mr Hogan outlined the challenges facing airlines trying to bring new competition to global markets. Mr Hogan said: "In a world of mega-connectors and mega-alliances, it is impossible to go it alone when trying to compete on the global stage. The regulatory challenges, the daunting cost of entry and the might of the legacy carriers create incredibly high barriers." Mr Hogan noted the carrier invested in partners in addition to investment in infrastructure, aircraft, people, technology, real estate and branding. Mr Hogan explained: "A network carrier needs global reach if it is to compete effectively and the market is too mature, too dominated by legacy interests, for any new carrier to get that reach on its own. We've used partnership since day one, in the form of a growing codeshare network, but the equity investments took that approach to a new level." Etihad now has 49 codeshare relationships and has minority equity investments in airlines in strategic markets, including Virgin Australia, Alitalia, Jet Airways, airberlin, Air Serbia and Air Seychelles. On the equity investments, Mr Hogan said: "These relationships go far, far deeper. The 'skin in the game' of equity means we seek smarter ways to extend the relationship. That means close network integration, it means joint marketing and distribution, and it means business and cost synergies through Centres of Excellence. In each case, these investments have allowed the carriers access to effective capitalisation and financial restructuring. In such a capital intensive industry, that means we can truly be seen as a catalyst for positive change." [more - original PR]