Aviation: Alleged Under-Pricing And Heavy Govt. Subvention Maybe Among Reasons Why So Many Airlines Are Upset At Emirates Airlines


Middle East mega carrier, Emirates Airlines may have unwittingly attracted so many unfriendly friends in the aviation industry due to the fact that it is allegedly heavily subsidised by the United Arab Emirates Government and it substantially low fares compared to other operators.

According to quora.com One of the biggest grievances from the other airlines is just how aggressive Emirates is with pricing.

Here’s a bunch of airlines offering Business Class for Singapore (SIN) to Newark (EWR) from the Expedia Android App. (Two adults, Mar 9 to Apr 6, 2020 roundtrip, Non-stop and One stop flights only).

The “normal” airlines charge a pretty penny for that flight (all prices are per person):
• Lufthansa, $7,010
• The nonstop Singapore Airlines service, $6,943
• United, $5,236
• Cathay Pacific, $5,176
And then you have Emirates wanting a mere $3,942.

• For the price of a GAMING PC, you can fly aboard some of the most famous, most luxurious, most souped up airplanes on earth for very long distances. That is ridiculous value for money.
The people who are fans of, or loyal to, Emirates would say that there is a very compelling case to be made against other airlines allegedly overcharging for supposedly inferior service. And they’re not wrong with that.

• This is how you lie flat on Emirates…
It also doesn’t help that Lufthansa keeps complaining about the competition’s very aggressive pricing for both short-haul and long-haul services (1), giving the impression that they are indeed overpricing for flights while having (allegedly) inferior service against Emirates.

So now You’d ask at this point: Why are Emirates flights that cheap?
Well, Emirates is based in the United Arab Emirates (as if the name wasn’t a dead giveaway). Specifically in the Emirate of Dubai (one of the seven forming the UAE).

READ: Aviation: Dubai based airline, Emirates issues travel warning as Dubai Airports expects 1 million passengers

Now, What is Dubai most famous for?
• The Police using supercars?

• The big Emirates whales that feature a real shower and tabletop bar straight out of a fancy Ibiza club?

• All are close answers, sure, but the real answer is Dubai is obscenely, ridiculously rich thanks to all that oil, business, and tourism money – they have a nominal GDP of 108 billion dollars in 2016. (3)

• Specifically, the ruling Al-Makthoum family is obscenely rich – one of the world’s richest. The current CEO of the Emirates Group alone, Sheikh Ahmed bin Saeed Al Maktoum, has 32 billion dollars to his name. (4)
It doesn’t help that every single aspect of airline operations in Dubai has the Al-Makthoum ruling family involved. There is absolute vertical integration between the ruling family, airline regulatory bodies, and the airline itself. Or to put it in another way,
(Sheikh Ahmed) is also President of Dubai Civil Aviation Authority, Chairman of Dubai Airports, and President of dnata. That would be like Doug Parker being CEO of American Airlines, head of the FAA, and President of DFW, ORD, LAX, JFK, and MIA Airports.

The rulers of Dubai also use their seemingly bottomless pit of cash to prop up Emirates by buying very large planes and deliberately taking in – and writing off – substantial losses from their daily operations. Or at least, that’s what the US airlines allege is happening with Emirates. (2)
To wit, other airlines are unhappy with Emirates because:
• They have seemingly unlimited capital to spend on new planes.
• They charge thousands of dollars less than other carriers, this raising serious questions about how profitable they truly are.
• Their owners are obscenely rich and allegedly use government resources to ensure Emirates keeps thriving despite unwelcome market forces and trends.
• They fly really big planes to destinations that without their alleged undercharging would make zero financial sense because of very low demand.

As a final word, consider that Turkish Airlines is also a government enterprise and that President Erdogan is using them to connect Turkey to the world diplomatically. And yet everyone loves TK and they coexist peacefully with the US3, everyone in the Star Alliance, and many more partner airlines.



Subscribe to Our Newsletter.

Enter your email address and click Sign up to receive our updates.

1 0
Article Tags:

No Comment.