A Sample Feature From Aviation News

Etihad Airways
United in the Arab Emirates

The western world has become used to the precedent of private enterprise and (often) finance taking the lead in many industries – to the extent that we are occasionally taken aback (not to say envious) when a government elsewhere decides to invest directly in developing a new arm of national industry. Such is the case with Abu Dhabi government-backed Etihad Airways, which took to the skies following Amiri Decree No1 in 2003, that event being followed by eye-catching orders for new airliners and a rapid expansion in services. Ewan Partridge reports.

Above: Etihad can be translated as meaning United or Unity. (Photo, Robbie Shaw).

The governments within the United Arab Emirates (UAE) (of which Abu Dhabi is a member state) are forward looking, thinking and acting. Oil has brought them great riches in recent decades, but securing long term economic prosperity, with a degree of independence from oil related income has become a priority. Consequently, the state governments that make up the UAE are undertaking the kind of state-sponsored projects that were common in the west up until a generation ago and this is where ventures such as Etihad Airways fit into their larger scheme, the carrier being branded as ‘The National Airline of the UAE’, and based in its capital, Abu Dhabi.

The ambitions of Abu Dhabi coincide with availability of the latest generation of long-range airliners developed by Airbus and Boeing, which in turn encourage the use of the geographic location of the UAE as an important hub between other large populous centres around the world. The UAE is also close to large tracts of West Asia where economic growth and labour migration are stimulating air travel, thus offering a fairly idyllic amalgam of location, demand and ambition. As Etihad’s UK and Ireland General Manager Peter Dunkin points out, ‘Abu Dhabi is itself a green island city surrounded by beaches, yet underserved until now, therefore it was an obvious proposition to create an airline that could fulfil the potential of Abu Dhabi and all of the UAE’.

Following the decree issued by Sheikh Khalifa Bin Zayed Al Nahyan – Crown Prince and Deputy Supreme Commander of the UAE armed forces, Etihad (the name may be translated as unity or united) was launched on November 12, 2003, with the Abu Dhabi government as sole shareholder. An early decision under Chairman Dr Sheikh Ahmed Bin Saif Al-Nahyan was that the Airbus A330-200 would be the workhorse of the Etihad fleet and operations began using a leased pair of that type. A ceremonial flight was made to Al Ain (also in the UAE) on November 6, 2003, followed by the first revenue service to the airline’s first scheduled destination, Beirut, six days later with Damascus added shortly afterwards. On March 2, 2004, Colombo became Etihad’s first non-middle eastern destination and London Heathrow became the airline’s first destination outside Asia on March 28, 2004. Etihad now operates services to London Heathrow eight times weekly, but added London Gatwick to it’s schedule in the autumn of 2004 to satisfy the level of demand. In the meantime Etihad had also introduced Geneva and Munich to it’s route network and at the close of 2004 that network totalled a credible 16 destinations (Etihad having added one a month since inception), by which time it had picked up the ‘World’s Leading New Airline’ award at the World Travel Awards, held on December 11, 2004.

Above: Cargo loads are one factor that determine the use of the A340-300 on London Gatwick services. (Photo, Robbie Shaw).

A fleet from nowhere

Etihad’s initial, blistering pace of growth has been facilitated by a steadily enlarged fleet of leased airliners, which by the end of 2004 had grown to six* 225-seat A330-200s, plus sole examples of the 265-seat A340-300 and a Boeing 767-300ER (the latter being used for both airline and government work), together with leased Boeing 767s from EuroAtlantic and an Islandsflug Airbus A300 on dedicated freight work. Use of these aircraft precedes delivery of orders placed by Etihad following examination and specification of its forward requirements. This led to a $1.09bn order for five Boeing 777-300ERs, which are all scheduled for delivery in the second half of 2005.

Etihad has also placed orders with EADS that could amount to $7bn for four A380s, four long-range A340-500s, four A340-600s and 12 A330-200s. Within the terms of this deal Etihad has also taken options on another 12 unspecified Airbus airframes (perhaps the largest start-up order of all time), these aircraft will be powered by Rolls-Royce Trent 700 and 900 series engines. Deliveries begin in 2006, with the larger A340-600s and A380s being taken as early as 2007; Etihad has a projected fleet numbering 50 airliners by 2009 and aims to serve approximately 70 destinations by 2010.

Another facet of Etihad’s growth plans is that it intends to apply for its own traffic rights without impinging on agreements that pre-existing UAE carriers hold. With regard to Etihad’s ambitions, Peter Dunkin has this to say:- ‘Etihad will benefit from the growth of the UAE and Middle East as a whole. We will fly only to those destinations where we see a need for a guest (customer) focused airline, and where there is the most business potential. The continued growth of Etihad as well as other UAE-based carriers will benefit the whole region as well as those passengers travelling through the region’.

Another aspect of the UAE government’s plans is for the development of the states as a holiday destination and the airline has set up Etihad Holidays to cater for this. In turn this generates employment which attracts labour into the region and generates more air travel as migrant workers move to and fro.

Growing an airline with Etihad’s aspirations at the pace that it is setting itself, while matching and bettering the level of quality that has already been defined in this region’s market is going to be a challenge of some import for Etihad. Peter Dunkin commented ‘We have the advantage of starting from the beginning with no legacy overheads and our location and proposition is very appealing to the best and brightest, so we have been able to recruit a wonderful staff from over 50 nationalities who bring a wealth of experience to us. We are very optimistic about the future and our loads reflect that’. More experienced staff will be taken on as the airline increases its route network.

Above: Etihad’s A330-200s will form the backbone of the airline’s growing fleet. (Photo, Dave Jefferys).

The seven EMD aircraft had all flown by mid-October 1996, with introduction to the fleet being undertaken in the summer of 2000. By November 2002 Super Hornets were being used in combat over Afghanistan. In addition to the strike and air defence roles, the Super Hornet was also being used in the tanking role using a buddy system. Unlike the Lockheed S-3B Viking, the Super Hornet could operate much closer to enemy airspace because it had the capability of defending itself.

For the rest of this article please see the April 2005 issue.