Students of the falling out between the three major Gulf airlines and their three main U.S. rivals may look to the association between Emirates and Australia for guidance about how such relationships evolve. Some analysts who have studied that history are saying the clash between Emirates and the Americans was âinevitable.â
When Emirates launched Melbourne service in 1996, there appears to have been no sense that the Australians saw it as an invasion of their âpatch.â On the contrary, in recent years, Australian officials have spoken surprisingly warmly about the beneficial effects of their nationâs partnership with Emirates.
More than that, Emiratesâ arrival at the beginning set off no alarm bells. âIn 1996, Emirates had 26 aircraft. Probably, people looked at them and saw no chance of success,â said Mark Lapidus, CEO of aircraft lessor Amedeo, whose first 777 was the 24th aircraft to join the Emirates fleet that year.
Emirates launched Australian service with four weekly flights to Melbourne, via Singapore. Sydney followed in 2000, Perth in 2002 and Brisbane in 2003, the year in which Sydney-Auckland, Emirates first New Zealand service, also started. Melbourne-Christchurch followed in 2004.
As of July this year, Emirates was flying 84 flights a week to Australia, with 28 of them passing though to New Zealand. Over time, it has also developed stopovers to Australia in Bangkok, Singapore and Kuala Lumpur.
In April 2013, Emirates and Qantas started their âGlobal Aviation Partnership,â offering âexclusive frequent flyer benefitsâ and jointly, today, 98 flights per week to Dubai. Qantas and Emirates are the only two airlines operating out of Dubaiâs Concourse A, the worldâs only A380-compatible terminal, which has the capacity for 15 million passengers a year. Last year, Emirates said seat factors on its Australian flights were 80 percent, and it claims to have invested $85 million in Australian culture and sports.
Emirates launched its first A380 from Dubai to Perth in May, making Western Australiaâs leading city the fourth Australian port of call for its double-decker aircraft. Along with partner Qantas, a total of seven daily A380 services now operate from Australia to Dubai with onward connections to Emiratesâ global network.
âThe fact we now offer A380 services into four Australian cities is a testament to the strong global demand for travel into Australia, a premier tourist location and key destination on our global network,â said Barry Brown, Emirates divisional senior vice president, Commercial Operations East. âThe addition of the Perth A380, as well as our partnership with Qantas, offers more Australians the opportunity to experience some of our European and American destinations.â Starting March 2016, Emirates will operate its sixth daily A380 to Australia, to Melbourne, via Singapore.
Today, Emirates is looking ahead to expansion throughout Australia and wider Australiasia. According to CEO, Sir Tim Clark, speaking to reporters October 5, the two airlines are mapping out their relationship over the next three-five years. â[Australia is] a growing market,â he said. âWe have very high seat factors on our routes. We are looking with our partner, Qantas, to see where the capacity is needed. And that exercise is being conducted by the planning groups of both airlines, as we speak. They will report probably in March of next year.â
Asked if there were any secondary routes under consideration in Australia, he said: âDarwin, Cairns, Broome, Alice Springs. Look, there are lots. At the moment, we are concentrating on four hubs, and Adelaide, of course. Weâre concentrating our efforts on looking at what Australiasia is going to do to our partnership with Qantas. And where capacity is required. Obviously Sydney, Melbourne, Brisbane and Perth are going to be primary areas.â
He continued, âAt the moment, the Australian economy is down. Demand for commodities, and prices, are falling. So things are slightly flatlining in Australia. But the fact of the matter is that growth in our markets continues unabated. As I said, we will look at everything. Last week I had a meeting with [Qantas CEO] Alan Joyce and the Qantas team where we agreed to map the way forward over the next three-five years. Thatâs all I can say.â
Could the Qantas partnership ever be used to give Emirates greater access to points in Europe, for example with Qantas flying to Berlin from Dubai? âWeâve always said to Qantas that when we got the 787-9, they would consider flying from points in Australia into Dubai, and reactivate some of the [destinations] they had aero-politically: Frankfurt, Paris, Rome and some of the rest. And thatâs all on the table.â o
Asked if Emirates would consider a partnership like the one with Qantas in the U.S. market, he said: âNo. Well, who?â
Amedeo CEO Lapidus is an admirer of the EmiratesâQantas partnership. âQantas has had an amazing turnaround as a result of their joint venture with Emirates. Itâs doing extremely well for them,â he said. Qantas officials agree.
Stephen Thompson, Qantas Executive Manager International Sales, told AIN in an interview, âTwo-and-half-years down the track, weâre extremely pleased with how our partnership with Emirates is going. Not only has it been a part of the turnaround of our international business, itâs also been great news for our customers, and great news for Australian tourism.â
Thompson said ending Qantasâ joint venture with British Airways was a tough decision. âIt was a partnership that had worked well for a long time, but in the end we both agreed it was time to move on.
âQuite quickly after opening our joint network [with Emirates], we knew we had made the right call, and the bookings we were seeing from our customers even in the first few months showed that they could also see the benefits of the extensive Emirates network and opportunities for one-stop travel to Europe.â
He said Australian passenger traffic to Europe had quadrupled thanks to Emirates. âIn the last financial year, we saw 1.5 million passengers fly on the Qantas code via Emirates flights, four times the number that flew with us under our previous arrangements for travel to Europe. We continue to see great feedback from our customers, with some of the strongest customer service responses coming from Dubai of any port in our network. We know thereâs always room for improvement, so weâll continue to work with Emirates and build on the partnership, making it even more seamless for our customers.â
Thompson did not rule out other partnerships for Qantas. âNo carrier can fly everywhere, which is why beyond Europe, the Middle East and Africa, we continue to strengthen the partnerships we have with other leading carriers based in key hubs to take our customers where they want to go.â
In the last 18 months, Qantas entered into new partnerships with Bangkok Airways, Sri Lankan Airlines and WestJet, and expanded its partnership with LAN across South America. âAs a founding member of oneworld, we remain a committed member of the alliance, and continue our codeshare with British Airways on a number of destinations within the UK and Continental Europe.â
More recently, Thompson said, Qantas received regulatory approval for âmuch deeper and enhanced relationshipsâ with both China Eastern and American Airlines for travel between Australia and China and the US.
While some, like aviation analyst, Richard Aboulafia, may liken Qantasâ deal with Emirates to a âsurrender,â the evolution of the Emirates-Australia relationship offers no clues to possible relationships between U.S. legacy carriers and Emirates. But, like so many of the things Emirates touches, the Australian experience seems to have turned to gold.