Dubai: Getting tagged as the first major Gulf carrier to adopt a growth strategy that is not organic in nature, Etihad Airways was bold enough to tread the acquisition path to growth. And the strategy has paid, market experts say.

Etihad has been “in the right place at the right time”, according to Andrew Charlton of Aviation Advocacy. “But to say that is not to gainsay what the management of the airline has managed to do. Its strategy into the future will rely on finding new passenger feeds, either from new routes or from alliances with partners,” he said.

With equity stakes in multiple airlines, including Airberlin, Air Seychelles, Virgin Australia and Aer Lingus, over the last few years, and operations spanning six continents of the globe, Etihad managed to deliver profitability in 2011 — just eight years after operations commenced — and strengthened profitability in 2012.

As Etihad’s president and chief executive James Hogan put it in a statement: “It is a winning habit that we must never lose sight of.”

Going forward, however, Etihad has to ensure that the stakes in partner airlines deliver more than just passenger growth at Abu Dhabi, another analyst Saj Ahmad of StrategicAero Research said. “It needs them to be profitable and profitable airlines in their own right as well so as to reap dividends,” he said, adding that Etihad has moved leaps and bounds despite starting off when the industry was still reeling from the post-9/11 air travel decline.

Amazing feat

“It has since navigated that and the 2007 financial crisis and turned two consecutive years of profit within just 10 years. It’s an amazing feat led by a dual organic and inorganic growth strategy,” Ahmad said.

According to Hogan, Etihad has created a new model in modern aviation practices. “The competitive and regulatory pressures continue to swirl around Etihad but it has shown itself able to ride out those storms in the past,” Charlton said. “The future will not be easy, but I would rather face it built on the Etihad platform than the platform of most of the world’s airlines.”