The three hubs of Dubai, Abu Dhabi, and Doha are blessed with fortunate commercial geography: They are a four-hour flight to one-third of the world’s population and an eight-hour flight to two-thirds. Any self-respecting McKinsey study would have told these governments to build air hubs and national airlines to exploit their comparative geographic advantage. And they did.~Afshin Molavi
Source: Foreign Policy Magazine, May 4, 2015. Full article: http://foreignpolicy.com/2015/05/04/dubai-qatar-etihad-emirates-fair-skies-open-skies-american-delta-united/?wp_login_redirect=0
Flying any Gulf air carrier in the last three years has rekindled our love for flying. After traveling on a United Flight, and being charged for blankets, food, and headsets, one could only expect to be charged a toll for using the toilet. Indeed it is no surprise that the UAE, Saudi Arabia, Qatar…and Turkey have leveraged their cultural practices of hospitality IN the business of hospitality–namely in the airline industry.
Molavi’s article raised a range of points –that not only surprised us — and prompted the following questions:
- By 2027, Gulf carriers (Qatar Airways, Etihad Airways, Emirates Airlines, and Saudia Airlines) will add another 500 some aircrafts by purchasing from Boeing in America and Airbus. Will the Gulf countries be able the engineering and technical staff for maintenance and upkeep from local hires? Or will they go through the dejavu experience of the 1970s and 80s?
- If UAE’s Elitihad Airlines started with two airplanes leased by Pakistan, and SUCCEEDED by becoming the largest airline in the world, then how many other opportunities has Pakistan missed in the hospitality and tourism industries?
- How will top Arab airlines deal with its neighboring competitor, Turkish Airlines? They’ve launched an aggressive campaign in the U.S. to compete for American travelers going to the Middle East as well.
- The UAE observes an “Open Skies” policy, where any commercial airline is free to land in the UAE. Regarding airline industry policies and government relations: How fair or unfair is it for countries to subsidize the airline industry? Governments compete for oil and gas interests on behalf of oil/gas conglomerates… should the same geopolitical rules of play apply to the airline/tourism sectors?