Emirates airline is the world’s largest international airline. Its network comprises of over 140 destinations in 80 countries across 6 continents and the carrier transported over 49 million passengers in 2014-15. All its flights origin from Dubai International airport where the airline has an exclusive terminal dedicated to its fleet. In addition to its passenger business, Emirates also has a vast cargo business, which supports the core business.
Born in 1985 to compensate for Gulf Air’s reduced focus on the region, the airline has grown leaps and bounds in the past 30 years and is now a proud owner of 230, mostly wide-body aircraft. It aims to be the global carrier of choice and offers long haul flights that connect passengers traveling from Asia to Europe and North/South America and vice versa with only a single stop at Dubai. Multiple daily flights to and from all the major cities in the world ensure a quick layover in Dubai. The in-flight catering and entertainment services promise a pleasant flying experience and its exclusive priority lounges for business and first class passengers provide an additional layer of value.
To serve its ever-growing international passenger base, Emirates hires and trains an internationally diverse crew. This means that each emirates flight caters to multiple international languages, especially the language of the country of origin and destination. It has one of the largest terminals, Terminal 3 at Dubai airport, dedicated to its operations. It also has a brand new concourse to serve its ever-growing A380 fleet. It provides dual gated access to the two floors of the aircraft thus ensuring faster passenger turnaround. The fleet primarily consists two aircraft types – Boeing 777 and Airbus A380. Both are wide-body and can travel long distances to and from Dubai.
There is a strong alignment between Emirates’ business and operating models.
1. A dedicated terminal has multiple advantages: Terminal 3 at Dubai is one of the largest buildings in the world (in terms of area covered). It is a state of the art airport with excellent facilities to feed, entertain and house Emirates’ transit passengers. The size allows the airline to expand its passenger base continuously and reduce cost per passenger. It is a critical enabler of carrier’s success because of no restrictions on night-time flying. This means that Emirates can schedule its flights in a way to arrive just in time for critical connections between major international cities. Arriving at your destination after a long flight and learning that your bag has been left behind is one of the biggest pain points of air travellers. A fully automated baggage handling system ensures that bags in transit are quickly and correctly transferred from one plane to another.
2. The fleet: Emirates maintains a very young fleet which allows it to provide and capture a lot of value. Firstly, maintenance and fuel costs are low because newer aircrafts are more efficient while passengers enjoy a modern and comfortable interior. Secondly, owning just two varieties of aircrafts reduces training and maintenance facilities costs. A modern fleet promotes perception of safety and quality, which are critical value propositions in the airline industry. The 777 is the backbone of Emirates’ fleet and is one of the safest aircrafts in operation today. The internal mood lighting and an on-demand entertainment system with touch screens (even in Economy class) ensure that passengers are engaged throughout the flight. The airline also consistently invests in new airplanes with more than 280 new orders in pipeline.
The aforementioned alignment between its business and operational model enables the company to offer a lot of value for its customers and resultantly capture value by achieving scale and reducing costs. As Dubai prepares to host Expo 2020, Emirates is positioning itself to handle a significant increase in its customer base leading up to that. Also, amid falling oil prices, it would be interesting to see how much of that value does the airline capture and how much it passes on to its customers.