Emirates airline boosts Mideast market leader status

Emirates’ buying spree is in step with the ambitious plans of the city-state to establish itself as a regional hub for travel, tourism and business.

‘Dubai is investing billions to secure its future as a leading centre for business, tourism, and air transport on the global stage,’ Emirates chairman and chief executive Shaikh Ahmed bin Saeed Al Maktoum said at the start of the prestigious five-day show on Sunday.

‘Emirates is investing in a fleet for the future, in order to support Dubai’s development,’ he added, as he inked a deal with European aircraft manufacturer Airbus for 70 A350 XWB jets and 11 additional A380 superjumbos.

The deal is valued at 20.2 billion dollars but could shoot up to 31.7 billion dollars if Dubai’s flagship carrier firms up an option for 50 more A350s.

Emirates was already the largest single customer of Airbus’s A380 and now has 58 units of the largest airliner on order. It expects to receive the first unit in August 2008.

The carrier also ordered 12 more units of Boeing’s 777 family in a deal valued at 3.2 billion dollars.

Although the deal could seem like a consolation for the US arch-rival of Airbus, it put Emirates on track to be the world’s second largest operator of the Boeing 777 planes, with 53 units in service and 57 others on order.

‘In 2003, our plan was for Emirates to have 100 aircraft by 2010. We have already surpassed that target,’ Shaikh Ahmed said.

Emirates has 111 planes and its fleet is growing by one jet per month on average. Its order book boasts a whopping 246 aircraft.

The nearest regional competitor in terms of orders is Qatar Airways, whose order list stands at 142 aircraft, with 30 more Boeing 787 Dreamliners taken on option.

Qatar’s national carrier has a fleet of 58 all-Airbus aircraft, serving 79 destinations.

Emirates claims that its daring expansion plans are based on growth and demand which have ‘exceeded the most optimistic projections,’ according to Shaikh Ahmed.

Emirates carried 17.5 million passengers in the financial year 2006-2007 compared to 14.5 million the previous year.

During the first half of this year, passenger traffic in the Middle East recorded an impressive 18.7 percent increase—the highest worldwide --, according to the International Air Transport Association (IATA).

Emirates insists it is financially independent from the government of Dubai, one of the seven members of the United Arab Emirates.

It posted a net profit of 844 million dollars in 2006-2007, and claims that annual growth has never fallen below 20 percent since its inception in 1986.

But the Dubai government appears now to be backing an aggressive expansion into the air travel market, which involves in addition to Emirates other air travel arms.

On Monday, government-owned leasing firm DAE Capital sealed a contract worth 13.5 billion dollars to buy 100 planes from Airbus and another worth 13.7 billion dollars for 100 aircraft from Boeing.

The newly-started DAE Capital is part of the Dubai Aerospace Enterprise (DAE) which is developing an integrated aerospace cluster that will eventually be based at a new airport being built on the outskirts of Dubai.

The facility aims to be the world’s largest airport once fully completed.