UAE airlines see stiff competition on Pakistan route
Emirates and Etihad Airways believe that healthy competition among airlines and increased flights will benefit them in the growing and dynamic market of Pakistan. Flydubai launched its flights to Pakistan on June 21 this year.
“Flydubai is a welcome entrant and its operations in the region, like other low-cost airlines, can lead to an increase in the share of air travel and attract more people to Dubai. This is good for Dubai and all airlines operating there and of course for Pakistani travellers looking for low-cost options,” said Adil Al Ghaith, Emirates Vice President for Pakistan and Afghanistan in an online interview with The Express Tribune.
He said unlike flydubai, Emirates as a full-service carrier targets a different travel segment. As more new carriers start operating in the Pakistani market, a more competitive environment will be created, leading to improvement in service quality.
“Emirates has always welcomed healthy competition, whether it is in the form of a new carrier or new initiatives by existing operators,” he said.
“Pakistan is an important aviation market with the potential for growth and Emirates will continue to focus on innovation, quality and customer service,” he said.
Ghaith said revenues for West Asia and Indian Ocean, the region in which Pakistan falls, rose by 7.8 per cent compared to last year. Revenues for the region totalled 5,322 billion UAE dirhams ($1,450 billion) in financial year 2009-10 compared with 4,938 billion dirhams ($1,346 billion) in 2008-09.
Relevant indicators including Available Seat Kilometres, Revenue Passenger Kilometres and Passenger Seat Factor have also shown strong growth, which further signifies that the aviation market is expanding, he added.
“We see passengers becoming cautious in terms of service quality, price and competition in the market,” Ghaith said while discussing customer choice.
In 2009-10, Emirates carried more than 420,000 passengers from Pakistan and the load factor averaged around 80 per cent for the country which reflects healthy performance and potential for growth.
On the question of Etihad Airways expanding operations in Pakistan, he replied: “It is not the first time that a competitor of Emirates is expanding operations. Emirates does not perceive it as a challenge but as an opportunity since the bar is raised for all in the aviation industry.”
Currently, Emirates offers 39 return flights per week between Pakistan and Dubai including 28 flights from Karachi – the business hub of Pakistan.
“As we ride into the current financial year, we will focus on strengthening our network and any additions will be subject to regulatory approvals both by Pakistan and UAE,” Ghaith added.
UAE, especially Dubai which is widely regarded as the shopping capital of Middle East, remains a key travel destination for Pakistanis. UAE is home to over 880,000 Pakistani expatriates.
Country Manager Pakistan, Etihad Airways, Amer N Khan, said flydubai is a budget carrier and is altogether a different model compared to Etihad, the national airline of the UAE. “But yes, such low-cost air carriers have clicked all around the world.”
More airlines coming into Pakistan from the UAE means increased air traffic between the two countries. Pakistan, with a big population, has a huge potential for growth in air travel, Khan said.
“In competition, Etihad is close to all major airlines operating in Pakistan including the national air carrier. We think competition is something that is always positive,” he said.
“The entry of flydubai into Pakistani skies is a positive development for travellers and aviation industry,” said Rana Abdul Ghafoor Khan, Chairman Travel Agents Association of Pakistan (TAAP).
Flydubai will take at least six months to win some concrete share in the market. “The entry of flydubai will increase Dubai-Pakistan traffic with the new airline expected to offer travel packages with hotel accommodation at economical rates,” he said.
Unlike many, Khan does not agree that the entry of flydubai will affect the business of Pakistan International Airlines (PIA) which has a large number of domestic passengers travelling on Middle Eastern routes.
Published in The Express Tribune, July 22nd, 2010.
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