It seems not a week goes by without an announcement of new routes or increased frequencies or larger aircraft sizes to a regional European city from the Gulf airlines.
By June this year, Emirates, Etihad and Qatar will operate to 64 European destinations between them (65 from August).
However, many of these cities – Copenhagen, Larnaca, Budapest, Valletta, Manchester and Dublin – are hardly giant conurbations with huge catchment areas.
One or two are capitals, but some are very much second or even third cities, while others are even island cities.
So what is fuelling this extraordinary growth into Europe? And is there a clear strategy that connects all three?
Take Manchester, for example, probably the best example of a relatively small European city being serviced by Gulf carriers.
Emirates announced in March it would start a third daily flight to Dubai from Manchester from May 1. This is in addition to last year’s deployment of an A380 – the first regional airport to have one.
A week earlier, Etihad announced it would double its flights between Manchester and Abu Dhabi from seven to 14 a week from August 1. Last November, the airline opened a new lounge for first and business class passengers travelling from Manchester.
Qatar, meanwhile, announced it would axe flights from Gatwick this summer and use the freed-up aircraft to expand at Manchester, where it will go double daily from June 1.
That’s a total of 49 direct Manchester to Gulf cities per week – on wide-bodied aircraft in a three-class configuration, often including a first class.
All the airlines state that they are filling the gap left by BA when it pulled out of the long-haul market, but how can that figure be sustainable?
All three carriers emphasise the strong growth in demand from Manchester for flights to their Middle East hubs and on to the Far East and Australia.
Laurie Berryman, Emirates’ vice president UK & Ireland, says: “We’ve already filled the additional capacity we introduced with the A380 last year and demand continues to grow, hence this plan for further growth.”
Manchester Airport’s managing director, Andrew Harrison, said: “Since bringing the A380 to Manchester last September, the route to Dubai has been one of Emirates’ strongest performers and we saw a full complement of 517 passengers in November, so we know the traffic is there.”
In fact, one of the airports that has suffered in the past year has been Gatwick, where Qatar announced it would be axing services from May 31.
Its move follows that of Etihad and Oman Air in quitting the airport, leaving just Emirates now operating there.
Island cities
It might seem hard to understand how Manchester justifies so many services, but it’s perhaps even tougher when it comes to Valletta (Malta), Larnaca (Cyprus) and Dublin, particularly since the latter country’s economic crash.
Larnaca is served by both Emirates and Etihad and has a population of 72,000.
Salem Obaidalla, Emirates’ senior vice president commercial operations for Europe and the Russian Federation, says: “Although both Malta and Cyprus are not massive catchment areas, both destinations have a good mix of leisure, business, VFR and labour traffic which travels in and out of the islands.
“Because of the demographics of the island, the airline flies via Cyprus (Dubai – Larnaca – Malta – Larnaca – Dubai), combining traffic out of the two small countries.”
Emirates has Fifth Freedom traffic rights between Malta and Cyprus and also operates a strong-performing cargo service to the island.
Etihad launched its Larnaca service last year. Chief strategy & planning officer, Kevin Knight, says: “[Larnaca] attracts strong seasonal leisure traffic and there is good demand for weekend breaks, even during the off-season.
“Inbound, this destination is popular with Australian travellers, especially in Sydney and Melbourne where there are well-established Cypriot communities.”
Dublin (population 506,000) has been served with a daily flight since 2007 by Etihad, which opened a premium lounge at the airport last year.
Knight describes Dublin as a “niche market” for the airline, which performed well for traffic going on to the Indian sub-continent, Asia and Australasia.
When asked if there had been a sharp drop-off in traffic since the country’s economic meltdown, he said: “As an industry, aviation is of course very sensitive to the economic climate.”
Central Europe
Qatar Airways’ chief executive, Akbar Al Baker, explained that the airline’s European strategy, which was launched early last year, focuses on identifying underserved markets across the continent and maximising connectivity between key cities beyond Doha.
To this end it launched flights to Budapest via Bucharest on January 17 to tap into both leisure and business traffic.
“Hungarians no longer have to backtrack to congested European hub airports to reach the Middle East and Asia-Pacific,” explains Al Baker.
“The new routes to Bucharest and Budapest will both function as gateways for new markets and will consolidate Doha’s position as a key hub linking East with West.”
For destinations such as Geneva and Belgium, it’s perhaps more obvious why the Gulf carriers would want to consolidate their position.
Emirates launches a daily Dubai–Geneva service from June 1, its 26th European city.
The airline has been flying to Zurich for almost 20 years, so this will be its second city in Switzerland.
The market it will be tapping into will not only be banking but also the United Nations Office in Geneva, the World Trade Organization and the World Health Organization.
Sheikh Ahmed bin Saeed Al-Maktoum, chairman and chief executive of Emirates Airline & Group, said the route would support both business and leisure traffic: “Our research has shown that there is a high demand for this route from across our network, from both the business sector, particularly financial, and the leisure travellers who are looking for both summer relaxation and winter sports.”
So sure is Emirates of this demand that it is launching the route with a Boeing B777-200 and B777-300 in a three-class configuration.
Qatar is also increasing its Geneva capacity to daily, following the introduction of two new weekly flights.
Interestingly, Qatar is the largest supplier of natural gas to Belgium, so there is a clear business traffic demand there.
Al Baker adds: “There are very strong relationships between Qatar and Belgium and as the capital of Europe it was a clear city we wanted to open a route there.”
Overall strategy
In terms of an overall strategy, a number of key themes do emerge from all three airlines: offering a frequent (at least daily) service; tapping into underserved markets with potential for growth; serving both business and leisure traffic; and establishing Dubai, Abu Dhabi and Doha as hubs for onward connections to the Far East and Australia.
Etihad’s Knight explains: “We know passengers on our main trunk routes into Europe want choice, so we are focusing on offering at least a daily service on key business routes – and wherever possible, a double-daily service – to attract a greater share of the corporate travel market.
“Business travel is beginning to recover after a couple of years in a tough economic climate, so we would hope to see an upturn in business traffic on board in the coming months and to be able to meet this demand with additional services.
“Increasing capacity and frequency also enables us to provide passengers with improved connections across the network, making transiting via our hub in Abu Dhabi much more convenient for business and leisure travellers alike.”
Qatar’s European plans are more succinct: “In Europe, Qatar Airways will continue to concentrate on expansion,” states Al Baker.
“Our goal for Europe has always been to expand to new countries while continuing to offer travellers a high quality travel experience, as well as provide the convenience of a large and diverse network.”
Emirates has always ‘specialised’ in regional UK cities – is it adopting a similar strategy in Europe, for example Nice, Düsseldorf, Hamburg and Venice?
Obaidalla says: “Emirates’ strategy of offering travellers the opportunity to fly directly to regional cities is continuing to prove successful, not just in the UK where it flies from six airports, but also in markets such as India, where it flies from 10.
“Emirates is continually looking at regional airports to assess levels of demand for possible new services.
“In the UK, Emirates’ newest regional route – from Newcastle – continues to go from strength to strength, and has passed the half millionth passenger mark just over three years after the service launched.
“Hamburg, Nice, Milan, Düsseldorf and Venice are also good examples of this ‘regional strategy’ giving German, French and Italian travellers living close to these airports a greater choice of destinations.
“Düsseldorf also attracts passengers from eastern Holland and Belgium, whilst the catchment area for the Venice service includes south-western Austria, Slovenia and northern Croatia.
“We expect to attract passengers from Eastern France for our new Geneva route.”
The future
So where next for the Gulf carriers – can we see them launching services into ever smaller cities to join up the dots across Europe?
Qatar would not give a specific answer, merely stating it would “continue its expansion across Europe”.
Knight would only say that Etihad is “always interested in looking at new markets and opportunities”.
However, Emirates was a lot more forthcoming, stating that there were a number of cities it was considering when asked whether Barcelona, Budapest and Stockholm were on the list.
Obaidalla says: “We obviously have a wish list of destinations in Europe and when the circumstances are right, and there is an opportunity, we move forward.
“Spain was one of the countries we often received enquiries about, before we were able to announce flights to Madrid in August of last year.
“There was also a great deal of talk about Amsterdam before we started services there in May 2010.
“It is well known that, amongst other initiatives, we wish to open up routes to Berlin and Stuttgart, supplementing our four existing gateways into Germany.”
This article features in Routes News 2011 Issue 3
