At the recently concluded Dubai Airshow, LiveFromALounge talked to the Chief Commercial Officer of Dubai-based Emirates, Adnan Kazim.
Adnan Kazim joined Emirates in 1992, and he now leads Emirates’ Commercial Operations across the airline’s vast network of nearly 160 destinations in 86 countries including major departments in Dubai such as e-Commerce, Retail & Contact Centres, the Emirates Skywards loyalty programme and Emirates SkyCargo.He also heads the airline’s Strategic Planning and Revenue Optimisation teams, which are critical functions and his teams play an integral role that support the airline’s commercial success.
We talked about Emirates’ current operations in India, the tieup announced with SpiceJet and the launch of the premium economy product, amongst other topics. Here are edited excerpts of our conversation.
Could you help us understand what has been the recovery of Emirates as we kind of get out of the pandemic? How are things panning out?
We started the airline back from a scratch in May 2020, when we commenced ten flights to ten destinations, and gradually we expanded the network. In July 2020, Dubai was opened to the world, and we ramped up capacity and frequencies in many markets. Between March 2020 till May, the flights were only filling up in one direction. Since then, we started to see both ways capacity fill up. If I take you back to July 2020, we have almost recovered 90% of our network back to the pre-pandemic times. And now we’re working on recovering the frequencies and the capacity.
So far, we’re sitting roughly around 55 – 60% recovery of the capacity from the pre-pandemic times and we’re seeing more flights being added as we progress towards December and January, which are supposed to be peak season for traveling.
We have managed to put the entire 777 fleet to work, 134 aircraft, and in addition to that, we have 47 A380 already operating. And that even will be further ramped up in the months to come, as we see the demand shaping up and the sixth freedom positions coming back gradually with more markets reopening.
What is the view of Emirates on on the return of business travel? And how do you see travel is going to shift in the times ahead? I’m sure there’s some habits that have changed. What are you seeing on that count?
In terms of recovery there is a lot of focus on VFR (Visiting Friends and Relatives) that has started to happen. And instead of the corporate business, we have seen the more premium VFR come in and fill that gap for us. A lot of people who wanted to have privacy because of Covid, started traveling in the premium cabins.
So, interest in our premium cabin didn’t come down. And that’s where our yield is quite solid, because the premium cabins are highly occupied so far. But gradually, we are seeing corporate business coming back. We see that by summer next year, many corporates will come back as it used to be pre-pandemic. Because people need to physically engage, they need to build that trust, and meetings are happening. We see a recovery of the corporate business along with the leisure premium segment, which is happening big time.
We believe that 2022 will be a year of recovery. And we’re aiming, in the the financial year 2022-23, for a 100% recovery.
Let’s let’s go to your India operations. Are all the stations back online, and how is the traffic been from India?
We started India operations as repatriations, and then for the past eight months, we are operating under the air bubble regime, which is more capacity-restricted. Today we are doing almost 30% to the pre-pandemic capacity permitted. We’ve recovered the points and we’re doing nine points in India. But we’re still we’re way behind where we stand on the capacity.
Definitely there is demand. We see that in terms of what we’re doing today and our seat load factors, and even for the Indian carriers. That’s a reflection of the solid demand between the points between Dubai and India, that has not been catered.
We do hope that in the near future the bilaterals will be reactivated, so that we put things back to normalcy and recover the capacity. Even the Indian carriers, they will be able to ramp up the capacity to Dubai in the process.
Remember, you’re talking about two countries which are quite advanced in terms of vaccination. With all that in place, we do believe that things need to start opening up. You’re seeing many countries that was supposed to be coming later advance their opening, such as Australia. The US has already opened for vaccinated passengers, Europe is opening and things are evolving fast. And we hope India will come on board as well, in the same manner.
When do you see the travel bubble going away and regular bilaterals to be resumed? Because I would love, personally for example, to get on a flight with Emirates to the US but right now, as an Indian citizen, I can’t do that. So what do you foresee is the timeline for those things to reactivate?
It is difficult to predict. The Emirates airline has a network of 125 destinations, at least 80-85% of that network is not being covered by anyone, and none of the Indian carriers are covering these destinations. And even if they do, at one time, as a market India is quite a big market. You’re talking about 1.5 billion population, even if 10% of that population will be traveling, it is still is a big number of people that are moving up and down. It won’t be any harm to anyone.
But today, there is harm to the consumer. People want to travel, more countries are opening up and prices are going up. It’s not working quite well for the consumer’s benefit. People want flexibility. Especially in big markets like India, you need to give them flexibility for people to travel anytime they want, with lots of frequencies and options. But under the current air bubble, we are restricted. We are capping every flight with 180 passengers, even though we are flying the 777. We’re restricting frequencies to only 14 flights. It’s not really helping anyone.
Emirates is a preferred carrier for a lot of Indian travelers and people traveling to India. But now you will see competition. The Tata Group are on track to acquire Air India now. And they already have two other airlines. So, what do you think of the Air India privatization? And how do you think this will impact Emirates, if any.
For us, we welcome these kinds of moves by the Indian Government. Privatization brings with it more enhanced product offering to the consumer in India. We’ve lived in this kind of environment of competition. Today Dubai airport has more than 130 airlines operating from here. And that’s how you stand good, you stand ahead of the game, a lot of innovation, a lot of enhancement because of this kind of competition.
So I think this is quite a good move by the Indian government. It definitely would offer much better choices for people to to travel in the future. We as an airline, we always are open to even working with these airlines, we always believe that alone, we can’t do everything. And we’re quite keen and happy to engage with Indian carriers to have a partnership in the future, through cooperation and codeshares.
Today, we have a partnership with SpiceJet, but we are ready to have cooperation with the Tata group anytime when they establish themselves and they think they are ready to have a cooperation with any other airlines. Because we believe that putting hands together, you can, you can always bring more value, more more options, a bigger network. And we’re happy to explore all these kind of opportunities in the future.
But yes, we believe this is the right step forward. And this is how Emirates was established and this is how we built it. No protection and you need to face the competition.
You brought up your collaboration with SpiceJet. Has it been activated? And how many points do you cover in India? How does the codeshare arrangement work?
Unfortunately, in the pre-pandemic times, we did not have time to have full-fledged engagement to take it to the next level in terms of the codeshare and make it more seamless. The pandemic came in as a setback to the whole thing. But yes, we are now keen to engage with them once again. And reestablish the cooperation and see how we can bring in the benefits once again.
You’ve recently announced that the Premium Economy product is going to make it on a lot of your aircraft. I want to see what has been the initial reaction? I think you already have four A380 aircraft with the Premium Economy product. How has been the initial customer reaction and what have been the learnings to expand it to other aircraft?
We have already used this product into London Heathrow and Paris. We have seen the reaction was very positive. Initially we started to offer these seats to our FFP members, but gradually we started to sell it indirectly into the system as extra leg space. And we have seen quite an high demand around the product.
It (Premium Economy) will definitely fill a good gap. We have almost 30-40% of travel today happening in economy flex and flex plus fares, and they all could be entitled to travel in Premium Economy by paying a little more. So we have a big number of people who will move up to that level, rather than cannibalizing the business cabin to premium economy. This product will be offered for journeys of six hours and above, so that people can benefit from what the product can offer in the future.
Mainly, it will be used for long haul and ultra long-haul flights like US and Australia and South America, plus some parts of Europe. Definitely the product is well received. As you have seen, it has a leather seat, big IFE screen. It is a lie-flat sort of seat. It gives you the feeling of the privacy and it is a good product.
So I think I am quite optimistic that once we launched it next year, it’s going to be a well-received product and fill the gap which sitting there today. Especially with the pandemic, many companies have maybe downsize their budget, and they don’t travel anymore in business. But this is a good gap the premium economy cabin will once we launch it by Summer 2022.
Have you any other innovations planned are being launched by Emirates in the near future?
It is a part of our DNA to bring in new stuff. But we will announce that as we progress in the future.
You can also watch the video of the interview here.
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