Emirates, one of the world’s largest carriers, served more than 150 destinations worldwide before the beginning of the pandemic.
Even during the current crisis, the carrier is playing a central role in transporting vaccines, repatriating stranded passengers, and supporting Dubai’s hard-hit tourism sector.
But this wasn’t always the case. Emirates traversed a long and hard path before becoming the aviation behemoth that it is today.
When did it all begin?
In 1984, Sheikh Mohammed bin Rashid al Maktoum, then UAE Minister of Defence asked Sir Maurice Flanagan, then managing director of dnata, to look into starting an airline. By December that year, a comprehensive business plan was ready, and the name “Emirates” was chosen for the new airline.
A year later, Flanagan was tasked with the ambitious mission to launch an airline in 5 months with $10 million seed funding. There would be no subsidies or aero political protection under Dubai’s open skies policy.
On October 25, 1985, Emirates operated its first flights from Dubai to Karachi and Mumbai, using a Boeing 737 and an Airbus 300 B4 wet-leased from Pakistan International Airlines.
In its first 5 years of operations, Emirates grew its network to 14 destinations – these included Mumbai, Delhi, Karachi, Amman, Colombo, Cairo, Dhaka, Male, Frankfurt, Istanbul, Damascus, Jeddah, and Kuwait.
What is Dnata?
Dnata was established in 1959 with just five employees. The name originated as an acronym for 'Dubai National Air Travel Agency'. The company now provides ground handling services at top airports around the globe.
The glorious 90s
The 1990s saw air travel becoming more popular than ever before. Fares dropped as the competition and the number of customers increased.
It is during this time that Emirates really distinguished itself as a premium airline. In 1992 - a year when TVs were still a rare sight in UAE’s households – Emirates became the first airline to install video systems in all seats, in every cabin class throughout its fleet.
That same year, Dubai International airport completed a major refurbishment, and Emirates moved into a new $2 million departure terminal.
However, it wasn’t all smooth sailing that particular decade. Disaster struck…twice.
The US recession in 1990–1991 combined with the Gulf War wiped out air travel demand and inflicted losses of $10 billion on the industry. While this hit Gulf airlines particularly hard, Emirates bounced back swiftly and even placed an order for 7 Boeing 777s with 7 options.
The carrier’s financial strength became even clearer when it made its first acquisition in the form of a 43 per cent stake in Air Lanka (later renamed SriLankan).
Along with Emirates grew Dubai’s position as a global hub, which saw passenger arrivals hit the 11 million mark in 1999. In that same year, Emirates carried 4.7 million passengers on its fleet of 32 aircraft.
Emirates becomes a brand
It was only in the 2000s that Emirates became the global brand that it is today. Indeed, turn on any television set around the world and there is a presence of Emirates, either in advertising, on referees at the Rugby World Cup, on Formula One, or on the shirts of football players — a presence that shows the marketing prowess and reach of the airline.
Even operationally, the airline was not doing that badly. Emirates becomes the first airline to sign up for the Airbus A380, ordering seven with options for five more at the Farnborough Air Show. The world’s largest commercial aircraft has been a flagship of the Emirates fleet over the last two decades.
If that wasn’t enough, later in 2005, Emirates made history with an order for 42 Boeing 777s in a deal worth $9.7 billion. This was the largest-ever Boeing 777 order at the time.
In 2008, the Emirates Terminal 3 commenced, with 500,000 passengers departing from the facility within its first month of operation. The airline added 46 routes from 2000 to 2010.
The 2008 recession wiped out global demand for air travel overnight. A subprime mortgage crisis in the US set off a domino effect that brought the global financial system to its knees. Dubai, which at that point was a fairly globalized economy, was not spared either.
Emirates’ net profit for 2008-2009 slumped 80 per cent to Dh982 million.
In 2014, Emirates and Qantas signed a partnership to give customers of both airlines seamless Australian and international network connections, frequent flyer benefits and world-class travel experiences. The 10-year partnership included code-sharing, integrated network collaboration with coordinated pricing, sales and scheduling as well as a benefit-sharing model.
A few years down the line, Emirates and flydubai announced a strategic partnership, including an expansive codeshare agreement, schedule alignment and network optimisation.
Meanwhile, the carrier continued with its long-term strategy of expanding its fleet. In 2019, Emirates bought 30 Boeing 787-9 aircraft worth $8.8 billion at list prices at the Dubai Airshow. This added to its $16 billion Airbus A350 order, taking its total aircraft order at the Dubai Airshow to $24.8 billion.
Emirates: a leader during the crisis
Emirates, along with its global peers, was hit hard due to the pandemic. The company reported a loss of Dh14.1 billion for the first six months of its 2020-21 financial year (from April).
Despite the hardships, the airline has again become pivotal to Dubai’s goal of becoming a global vaccine hub.
The Emirates Group's resilience in the face of current headwinds is testimony to the strength of our business model, and our years of continued investment in skills, technology and infrastructure which are now paying off in terms of cost and operational efficiency
In October last year, Emirates SkyCargo – the airline’s freight division - announced that it was setting up the world’s largest certified airside distribution hub dedicated for the storage and distribution of these vaccines.
Earlier this year, Emirates SkyCargo joined hands with three other Dubai-based entities- DP World, International Humanitarian City and Dubai Airports - to form a COVID-19 vaccine alliance for rapid transport of COVID-19 vaccines to the developing world through Dubai.
The airline, which was quick to adopt COVID-19 protocols, has been globally recognized for its efforts towards ensuring safe air travel during the crisis. In November, Emirates - the first to offer free COVID-19 medical cover - expanded its multi-risk travel insurance coverage.
Most recently, the carrier unveiled ‘touchless’ self-check-in kiosks to make travel safer. The Dubai airline’s 32 self-service bag drop machines and 16 check-in kiosks can now be controlled completely by personal mobile devices without touching the screens.
Premium economy does well
Emirates’ decision to introduce premium economy has been met with instant success. During an interview last week, Tim Clark, the airline’s president, said he was “shocked” by the demand for the new seats.
In December, Emirates introduced the premium economy cabin along with enhancements across all cabins onboard its latest A380 aircraft. The airline has plans to retrofit its existing A380 fleet with premium economy seats.
Premium economy will “enhance the income per seat miles in kilometer” and allow Emirates to have a much more diversified offering, said Clark, during an interview conducted by the Centre for Aviation (CAPA).
The way ahead
The airline is now eyeing a return to profitability by 2022, according to comments made by Clark in the media. This is better than what the rest of the aviation industry can hope for.
The International Air Transport Association (IATA) – a trade association consisting of 296 airlines – has estimated that global passenger traffic will not return to pre-COVID levels until 2024.
“The Emirates Group's resilience in the face of current headwinds is testimony to the strength of our business model, and our years of continued investment in skills, technology and infrastructure which are now paying off in terms of cost and operational efficiency,” said Sheikh Ahmed bin Saeed Al Maktoum, Emirates’ CEO, in its latest earnings report.