Why Emirates is spending $2 billion on its A380s and dreams of a new jumbo jet

The Dubai-based airline has never abandoned the legendary Airbus plane and seeks to make it more attractive through a new Premium Economy class.

A time saved in the hangars of the airlines, due to lack of profitability, the A380 – which has not been manufactured by Airbus for three years – is now resisting to support the strong recovery of air traffic in the world.

The world’s largest plane flies with Qatar Airways, ANA, British Airways, could take to the skies with Lufthansa… and has never taken a breather with Emirates, the first and largest user of the device. 70 of its 118 units are currently in operation, a figure that will rise to 80 by the end of the year and to 118 next summer. Or the entire fleet of the company.

And Emirates continues to spend lavishly to modernize it. It is investing 2,000 million dollars to equip it with its new Premium Economy class, prepared to accommodate 56 passengers. This may not sound like much, on a plane that can exceed 600 seats in the longest haul configurations. But Emirates is betting big on this new category of traveler.

Business classes with competitors “not up to par”

“It is not an upgraded Eco class,” explains Cédric Renard, Emirates General Manager France, to BFM Business.

“Located on the upper deck of the A380, it incorporates all the Business class codes such as reception, catering and entertainment, he continues. We are convinced of the relevance of this proposal that is marketed between 10 and 15% more expensive than the Eco class “.

The manager believes that this new class will outshine the business classes of its competitors “which are not up to par.” A way of saying that some Business classes are less exclusive than this Economy Premium. “Our conviction is that it is the Eco customers who will want to have fun, it is this clientele that we are targeting.” Deployed on 3 aircraft in the fleet, this new class is receiving “very good feedback”, says the DG.

Business travelers could also see it as an alternative, especially since the company notes “a very strong recovery of this clientele in the Gulf area and from the Emirates to Europe and the United States.”

“The A380 is profitable”

In short, the A380 still has a great future ahead of it at Emirates because the company – through its clientele, its positioning and the interconnection links it offers – from Dubai, can make it a profitable aircraft.

And this despite a very high operating cost, especially in terms of fuel. “We have to make the relationship between the number of passengers transported and kerosene,” argues Cédric Renard, who points out that the company has “covered” itself with fuel, which allows it to escape for the time being the extremely high costs. “It is a separate product that is profitable,” says the manager.

This does not prevent the company from working on “cleaner” flights, the sector that aspires to carbon neutrality in 2050. “We will take off a 100% SAF (clean, agricultural or organic fuels) aircraft at the end of the year. We have been involved in this process since 2017 but there is a need to have a sector”, recalls the manager.

Large carriers remain at the center of the company’s strategy, while all of its competitors are betting on smaller, single-aisle planes. If the A380s are no longer manufactured, the company has ordered no less than 50 A350s from Airbus.

“They are relevant because world air traffic will continue to grow between 4 and 5% annually, airports are congested,” said the official.

The company is even dreaming of a modern new jumbo jet that is just as large in capacity (around 500 to 600 seats) but lighter and therefore less expensive for its operations.

Very jumbo: Airbus and Boeing do not believe it

In an interview in CNN Travelits boss Tim Clark explains that the needs justify this new device based on forecasts of passenger traffic growth of 4.5% per year starting this year.

“Is it possible to redesign a new A380? Yes. Is it possible to lighten the aircraft? Yes. Imagine a composite wing and a mostly composite fuselage. What you have today. You get a lighter, much more fuel efficient aircraft that runs all the boxes on environmental issues”.

“A revised A380 has all its interest”, abounds Cédric Renard. However, Airbus and Boeing have already expressed their doubts. Just like big companies. In short, Emirates is a bit on its own at this point.

6,000 hires

Asked by BFM Business, the European aircraft manufacturer seems to consider that the A350-1000, the largest aircraft in its catalog, covers the demand for jumbo jets.

“Our product strategy is to continually develop our aircraft to meet the latest market demands, as evidenced by the commercial success of our entire product line, including the largest A350-1000 produced to date. Our next aircraft to enter service at the beginning of 2024 it will be the A321XLR and by the middle of the next decade we are aiming for a carbon neutral aircraft, known as zeroE”, said a door-to-door word.

“There is certainly room for a replacement Boeing 747, but I don’t think there is enough demand to launch a program for an aircraft larger than the A380,” explains Geoff Van Klaveren, aviation analyst and managing director of independent aviation consultancy IBA. A. A really big plane is key to Emirates’ business model because 70% of its passengers connect to other flights, but I don’t think Airbus or Boeing would build one just for them.”

There is no shortage in Emirates: 300,000 requests for their hiring

While European air traffic has been hampered in Europe by a lack of staff on all floors, Emirates says it has largely anticipated the situation. And the numbers make you dizzy.

The company is massively rehiring: 4,000 Cabin Crew, 600 pilots and 140 types of positions offered for a total of 6,000 hires. And focused on salaries, benefits such as free accommodation in Dubai… “We take the measure of the world we face”, underlines Cédric Renard, DG France.

These levers seem to be working well: the company received no fewer than 300,000 applications for its recruitment campaign.

And these campaigns continue, especially in France. Two open days will be organized on October 11 at the Hilton hotel in Paris-Charles de Gaulle and on October 13 at the Marriott Cité Internationale hotel in Lyon. To your CVs!

Olivier Chicheportiche BFM Business Journalist

Leave a Reply

Your email address will not be published. Required fields are marked *