If you want to smile a little in the face of the bosses of a western airline in the corona crisis, you only have to briefly address golf lines such as Emirates or Etihad. "For years they were held up to us in all media and at every major event as airlines of the future, but now they are worse off than we are," says the board of directors of a major European line with a little pity - and even more malicious joy.
Emirates shows just how bad things are about the former growth miracle. Just over a week after the Arab market leader announced passable numbers with a decent profit, he is now facing mass layoffs, according to press reports. The line can cut up to 30,000 of its more than 105,000 jobs, according to the Bloomberg news agency . Measured in terms of the number of employees, this would mean that almost three times as many jobs are on the brink as with British Airways parent IAG or Lufthansa. The Emirates local rival Etihad is even worse off. The line from Abu Dhabi already wrote a loss of almost 900 million US dollars after three years of renovation even before the corona crisis. Qatar Airways from Qatar has not released detailed figures yet, but called for government aid in early March.
And that's just the beginning, fears Thomas Jaeger, head of the industry-specific data service provider CH Aviation from Chur in Switzerland and previously worked in the Gulf for a long time. "The current crisis will hit Emirates & Co. for a while more than many western lines," said Jaeger. "The companies will change their business model and, at best, will continue to grow with the market even after the crisis." They are getting smaller and more meager in service. Ultimately, however, the long-term fear opponents of Lufthansa or Air France-KLM will not perish because, unlike their western competitors, they can count on almost unlimited state aid.
This article comes from the "WirtschaftsWoche".
With Corona, the most impressive growth story in aviation has finally ended. For years, Emirates, Etihad and Qatar Airways literally drove the industry ahead. While the lines in Europe or the USA hardly increased, the golf airlines grew on average by more than 20 percent per year for 20 years. The operating costs, which are often only half as high as in the West, gave them competitive prices with which they could gradually push established Europeans out of the traffic to Asia. State loan guarantees made financing cheaper, a lack of unions and tax exemptions depressed spending. In contrast to Lufthansa or Air-France-KLM, they did without the hardly profitable short-haul traffic and instead opted for the more lucrative long-haul connections.
But this very focus is now proving fatal in the corona crisis. Because of the many travel bans, intercontinental connections have recently broken even more than short and medium-haul routes. And while in Europe and Asia many countries have released the shorter routes in Germany and increasingly also those in neighboring countries, long-distance trips remain largely on the ground. This is either due to an open flight ban or the fact that travelers often have to go to quarantine after landing - in the destination country or after returning home. And this also applies to countries like Vietnam or the Cook Islands, which are almost unaffected by the virus. "And these specifications are unlikely to change much at first," feared Hamburg-based aviation expert Heinrich Großbongardt.
Price war on the gulf
This affects the lines of the Gulf all the more because their business was crippling even before the corona crisis. The low fuel price meant that the customers from the Arab region, who were dependent on oil sales, lacked the petrodollars for their travel budget. In Asian traffic, competitors such as Turkish Airlines, long-haul low-cost airlines such as AirAsia X and the state-sponsored Chinese airlines caused an oversupply that the golf lines have further fueled in the reliance on unbroken growth due to large aircraft orders. In order to keep up, Emirates & Co. customers had to make the uncomfortable change in the Gulf tasty by means of even lower prices.