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Etihad Airways is marketing its Residence suites on A380 superjumbos servicing India at a fraction of the price they charge to the UK, seeking to lure travellers into the industry's most luxurious cabins on 3-1/2-hour flights from the Arabian Gulf.
The Residence berths on the Airbus Group SEA380 - with a lie-flat bed, living area with 32-inch television, en suite shower and private butler - will sell for $1,300 per trip when Etihad introduces the jets on its Abu Dhabi-Mumbai route May 1. The same cabin costs $20,000 for a one-way, eight-hour flight from the Gulf to London.
"There will continue to be a demand for luxury air travel, which really isn't about price but more about exclusivity and privacy," said Mark D. Martin, founder of Dubai-based Martin Consulting. "This may become a good subset product to the classic business jet charter customer."
Etihad is betting that a taste of cut-price luxury will appeal to the Mumbai elite and the ranks of business travellers with interests in the Gulf, as well as wealthier members of the Indian expatriate community there. The Residence deal is still far from a bargain fare, with Bahrain-based Gulf Air offering tickets on the route for just Rs11,762 ($179), according to Makemytrip.com. "We offer a choice of four travel cabins catering to different requirements," Etihad said in an e-mail. "This is one of our important selling points for India. If you don't offer choice, consumers will look elsewhere."
The pricing strategy for The Residence could help Etihad fill the two cabins on each A380 in a market that ranks as the world's cheapest for airfares. Passengers in India pay about $10.36 per 100km (62 miles), compared with $138.90 in Finland, the most expensive, according to a study by GoEuro.com.
The cost of flights to the Gulf may come down further after Indian Prime Minister Narendra Modi asked airlines for price reductions in September following complaints from Indian nationals in the Gulf about "exorbitant" fares during holiday periods.
Like Qatar Airways, Etihad Airways, led by its Australian chief executive officer James Hogan, has ordered relatively small numbers of A380s and made the double-decker the spearhead of a bid to attract top-paying clients. In addition to The Residence suites, each of Etihad's superjumbos has nine seats in first class, 70 in business class and 415 in coach. - Bloomberg
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