Emirates will control costs not cut staff
FROM EMIRATES TODAY, 19APR06
As oil prices touched $72.20 yesterday, Emirates planned to increase its productivity by 20 per cent to offset some of the costs, according to a top official.
"We can't do anything about the increasing fuel prices except hedge.We can only manage it the best by practices like hedging, commodity trading and other means," Maurice Flanagan,ViceChairman and Group President of Emirates, told Emirates Today.
When asked if the airline would be cutting down on manpower in order to control costs, Flanagan said that the airline can not reduce staff as "Emirates will be receiving the delivery of at least one new aircraft every month for the next six years".
"And in some cases, even two a month. For example, two big size A380s could come in the same month. So we have this huge increase coming up and there is no way we can cut down on staff numbers," said Flanagan, adding that the airline has also employed an independent expert who advises the airline on the changing scenarios of rising fuel prices.
Emirates recently said it might convert its order for the Airbus A340-600 - pending a possible upgrade into orders for more A380s, even though the awardwinning airline is the launch customer for the A340-600 High Gross Weight (HGW).
Airbus had indicated earlier that if Emirates backs out of the A340-600 order, the airplane manufacturer would have to sell the aircraft at rock bottom prices to other airlines.
When quizzed on how this would impact Airbus, Flanagan said: "It is a part of the normal perpetual problems that manufacturers like Airbus and Boeing face.Whether our ordering more of A380s would cover up costs for the Airbus depends on how many we place an order for. We are currently talking to Airbus about it and thus I cannot disclose all the details." Another decision pending on Emirates's tables is between Airbus's A350 and Boeing's 787.
"We are looking at both for now. However, we are in no hurry to take a call on which one we would go with because both of these aircraft are quite a way long off. We are talking to Boeing for the 787-10X, which is an extended 787 aircraft, which would be able to accommodate up to 300 passengers in a threeclass configuration," explained the Vice-Chairman and Group President of Emirates.
Emirates' current aircraft order with Boeing rests at $20 billion (Dh73.4bn). "So we are big buyers of Boeing aircraft. And we are also big buyers of American aircraft engines," said Flanagan.
There have been speculations whether Emirates's decision to choose Boeing, an American manufacturer, will be influenced by recent issues that cropped up between the United States and Dubai Ports World. But Flanagan said that the DP World deal is of "no relevance" as far as Emirates is concerned.
"It is disappointing as far as Dubai is concerned, especially for the people who live here. What has happened between DP World and United States feels more like slap in the face but it is of no consequence to us as an airline, and it will in no way influence Emirates decision of choosing between the American airplane manufacturer, Boeing's 787 and Airbus's A350," said Flanagan.