Etihad Airways is the national carrier of the United Arab Emirates, based in Abu Dhabi. It has grown significantly since its establishment in 2003, increasing its fleet size and the number of destinations it serves. Etihad has pursued a strategy of partnerships, taking stakes in airlines like Air Berlin and Jet Airways to expand its network without competing directly. These partnerships have helped double Etihad's profits between 2016 and 2017 while also increasing passenger numbers by 18.9% in that period. Etihad aims to continue its rapid growth and strengthen its position as a leading global airline.
8. Sheikh Khalifa bin
Zayed Al Nahyan
President of the U.A.E
General Sheikh
Mohamed bin Zayed
Al Nahyan
Crown Prince of Abu
Dhabi
9. Etihad Airways was established in 2003, in Abu Dhabi, UAE. It is the
national carrier of UAE, with the city of Abu Dhabi as its centre of
operations. The name is from the Arabic word meaning “union”.
Etihad’s fleet now contains 121 Airbuses and Boeings, with more than
1,300 flight per week to diverse destinations in the Middle East, Africa,
Europe, Asia, Australia and North America.
Etihad expects to have more than 156 planes by 2020.
PROFILE
10. Etihad Airways’ vision is to be the best airline in the
world, connecting the globe via Abu Dhabi.
Etihad’s Aims:
To compete in and dominate the commercial international aviation industry
and replicate the success of European expansions, by breaking records in
terms of flight frequency and number of destinations.
VISION
11. MILE-STONES
2011
In December 2011, Etihad announced it had taken a 29.21%
stake in Air Berlin, Europe's sixth-largest airline, and James
Hogan was appointed Vice Chairman.
2013
In September 2012, the Indian government announced that
foreign airlines could take a stake of up to 49% in Indian
carriers. On 24 April 2013, Jet Airways announced that it was
ready to sell a 24% stake in the airline to Etihad for US$379
million. The deal was completed on 12 November 2013.
At the 2013 Dubai Air show, Etihad announced that it was
acquiring a 33.3% stake in the Swiss carrier Darwin Airline.
12. MILE-STONES
2014
On 1 August 2014, Etihad agreed to take a 49% stake in the
Italian flag carrier Alitalia for an estimated €560 million. The
deal was closed on 8 August 2014. On 1 January 2015,
Alitalia-CAI formally passed its operations to Alitalia-SAI, a
new entity owned 49% by Etihad and 51% by the Alitalia-CAI
shareholders.
14. Etihad’s KPI’s (key performance indicators):
For 2016 and 2017, showing the increase in activity. The success of Etihad’s
growth can be seen by the increase in the number of passengers (17.6
million in 2017, an increase of 18.9 per cent from 2016) and the net profit
(which doubled between 2016 and 2017).
Table I-Etihad Airways’ key performance indicators
(comparison between 2016 and 2017)
Comparison Phase 2016 KPI’s 2017 KPI’s Percentage
No. of passengers
(million)
14.8 17.6 18.9%
Net profit (million USD) 73 103 41%
Total revenue (billion
USD)
7.55 9.02 19.5%
16. Awards won by Etihad Airways:
Air Transport World Awards
Airline of the Year
World Travel Awards
World’s Leading Airline (seventh consecutive year)
World’s Leading Airline - First Class
World’s Leading Airline - In-flight Entertainment
World’s Leading Cabin Crew
The Aviation 100 Awards
Airline of the Year
CEO of the Year (JAMES HOGAN)
World Air Cargo Awards
Cargo Airline of the Year
20. The leading gulf carriers all expanded their operations to North America
during 2012. Emirates Airlines led this movement by introducing three new
US destinations in 2012, which it was able to do thanks to its huge financial
capability. Etihad chose a different expansion strategy which the CEO
described as “sustainable growth through strategic alliances” (Hogan). It
acquired shares in other leading companies, such as Virgin Australia, Jet Air
and Air Berlin, avoiding direct competition. It also signed ten code-sharing
agreements in 2012, which enlarged its network scale around the globe. This
also reduced the operating cost, increased the opportunities to serve more
customers and doubled the net profit.
21. Due to traffic increases in Europe, the next two years are expected to be
high expansion years over the American continent, especially the USA.
Opportunities in the USA are gradually increasing due to lack of direct flight
from the Middle East. By June 2014, Etihad expects to announce the launch
of its first flight to new US destinations such as Los Angeles. That is likely to
be a major opportunity for Etihad, especially with attractive events happening
in Abu Dhabi, some of which are sponsored by Etihad Airways, such as a
Formula 1 race. Etihad has generally been successful in the USA, with a
loading factor on US trips during 2011 of 83 per cent, compared with Qatar
Airways’ 80 per cent and Emirates Airlines’ 74 per
22. Rapid Growth Reasons:
Etihad Airways recorded a year of solid progress in 2015 with further growth,
strengthened partnerships and ongoing recognition for the quality of its
innovative products and services. The airline recorded its strongest annual
financial results to date with a net profit of US $103 million for the year on
total revenues of US $ 9.02 billion. Strong operational performance saw an
improvement in load factor, as passenger volumes outpaced capacity
increases. In total, Etihad Airways carried 17.6 million passengers in 2015,
an increase of 18.9 per cent year-on-year.
23. Etihad Airways’ partnership strategy, based on 49 code-share agreements,
and its strategic minority investments in airlines, remained a key driver of
growth in 2015.A new code-share agreement was introduced in 2015 with
Pakistan International Airlines (PIA), while Etihad Airways’ existing code-
shares with Air Serbia, American Airlines, flynas, Jet Airways, Korean Air,
NIKI and S7 Airlines were significantly expanded. As a result, Etihad
Airways offered a combined passenger and cargo network of nearly 600
destinations through its 197 interline and 49 code-share partnerships.
A further measure of Etihad Airways’ growth was the increased membership
of its Etihad Guest loyalty programme.
24. Etihad established its own airline alliance, Etihad Airways Partners, in 2015,
that includes Jet Airways, Air Serbia, and Air Seychelles. Etihad Airways
holds minority equity investments in the participating airlines; as well as
holding a stake in Virgin Australia
26. STRATEGIC PARTNERSHIP
•Strategic partnership with in interest of company
•Strategic partnership with in interest of stakeholder
wealth
Types of partnership
Equity based partnership
Code-sharing
Strategic alliance
27. PARTNERSHIPS OF ETIHAD AIR LINE
Partnership with Air Berlin
Partnership with Air Virgin
Partnership with Air Lingus
Partnership with Air Seychelles
Partnership with Air Nasair
28. ETIHAD AIR LINE’S OTHER
BUSINESS PARTNERSHIP
There are two types of partnerships are following:
1. Tactical
2. Strategic
30. KEY FACTORS OF SUCCESS
Etihad Airways was stable from its beginning.
Etihad work for its customer loyalty and technological
progress.
The successful partnerships of Etihad with different
Airlines.
31. BENEFITS FROM OPERATIONAL
PARTNERSHIPS
Business partnership with Air
Berlin
Equity-based partnership
Expansion opportunities
lowing the operation cost
Nasair code-share agreement
Good opportunity to gain new
customers in this agreement
customer loyalty during peak
periods such as Hajj and Umrah.
140 expanded destinations
between the two countries
32. BENEFITS FROM STRATEGIC
PARTNERSHIPS
Technology sharing
(Jones and Hill)
Reducing the time and effort
required to deliver products or
services.
Build strong relationships
between both parties.
New communication
channel
Allows more interaction with
partners
More knowledge transfer
between employees
33. Etihad Airways enjoyed a 92-per cent increase over the five
years in sales revenue.
Etihad generated USD629 million from code-sharing
agreements in 2016.
The number of passengers increasing from 8 million in 2014 to
12.3 million in 2016.
INCREASE IN PROFIT:
35. COMPARISON OF 2016 & 2017
Comparison phase 2016 2017 Percentage
Difference
Number of passengers
(millions)
14.8 17.6 +18.9
Cargo carried (tons) 591000 596000 +8.0
Seat factor (%)a 79.4% 81.6% +05
Number of staff 24500 26500 +14
Net profit (millions USD) 73 103 +41
Total revenue (billions
USD)
7.55 9.02 +19.5
36. The Etihad air lines gets the 41% high net profit in 2017 and the
total revenue was increased by 19.5% in 2017.
It shows that how rapidly Etihad airlines growing.
The Etihad air lines progressed day by day because there is low
competition in the Arab in airlines sector.
The Etihad air lines gets higher profits because of high tourism
and business hub in Gulf.
The department of research and development was fully aware
with the rising threats of enhancement In the airlines sector
specially from Emirates.
CONCLUDING WORDS
37. The Etihad airlines focusing on the SWOT analysis and the
competition in the prevailing market and also the needs and
comforts of the passengers.
The Emirates top management is professional and capable.
The Etihad airlines purchases new and direct routs to various
countries and sub continents Including America, Europe etc.
CONT.