BTN's annual answer book for business travel managers.
is in the midst of a growth spurt in the United States, having launched service
to its Dubai hub from Seattle in March and from Dallas in February. The
carrier last week announced that Washington will become its seventh U.S.
gateway, with Dulles-Dubai service scheduled to start in September. Senior vice
president of commercial operations for the Americas Nigel Page, who in August
will retire from Emirates, recently spoke with BTN's Jay Boehmer about the carrier's growth, its approach to the
corporate market and why enabling inflight cell phone usage hasn't been quite
the nuisance some had feared.
How is demand holding up?
We've done very well in the last year, and in spite of some perceptions about the economy, I think we've done extremely well. We opened routes: Seattle in March, Dallas in February, and we're going to be launching Washington on the 12th of September. The corporate market has been holding up extremely well. We've had good loads in business class and reasonably good loads in first. Obviously, there are a lot of companies in certain segments, for example the IT segment, where the market is often going in economy class—that comes from policy. You'll often find that SMEs in different industries also travel economy. Generally, we've been really delighted with the way first and business has been maintained.
I imagine your expanded departure points from the United States have given you additional corporate doors to knock on.
Yes, of course. With new gateways, obviously you get new companies. In the case of Seattle, for example, it is an extraordinary center of IT companies, whereas a lot of the development work is obviously seen in Silicon Valley and going out of San Francisco. There are lots of small companies doing programming for things like video games in Seattle. Obviously, we have the very big accounts like Microsoft, like Weyerhaeuser, Nordstrom, Boeing, etc., and all of those have business to points that we would sell.
What's your approach to structuring corporate agreements with U.S. companies?
Obviously our corporate agreements are confidential, so there's a limited amount I can tell you about that, other than that in conjunction with the corporate accounts and with their travel agent, we discuss what the potential business is for the whole year and to what destinations and in what class, so we can get to some assessment of the revenue potential for the whole year so that we can structure a deal accordingly.
You use Prism to structure and monitor those deals, right?
Prism is one of the systems that we use, but it's just one of the systems. One thing you have to take into account with all of the different data systems that airlines use is that they don’t always tell the whole story. There could be revenue that's being ticketed direct by an airline that won't show up on these systems.
What are some other data sources?
Obviously, we look at market share through MIDT [booking data sold by global distribution system operators] and various systems for breaking that data down. And we're looking at some new systems as well that we're not at liberty to talk about at the moment. It gives us a very complete picture of who's ticketing what and to what destination and on what carrier. We can obviously judge what people are telling us they can do and what they are doing and cross reference that.Most corporates are pretty open, because they want to get the best sort of deal that they can and it's not in their interest to hide revenue data, which could mean a different deal if we knew there was greater potential. It's in everybody's interest that we're quite open in our discussion and we find the vast majority of corporates to be quite open and businesslike. We find these days corporate travel managers are more professional. Some companies have used various consultants to help them structure their corporate portfolio in terms of where they put their business and how much and so on. I think that's a good thing. As our clients become more professional, it helps us be more professional in reacting to our clients.
In the past, there had been some controversy in the United States over the use of cell phones during flights. How has the response been?
I've never heard of any complaints whatsoever. There is a limited number of lines per airplane, so you don't have the whole aircraft talking at the same time. We tend to ask people to respect their neighbors and put their phones on vibrate and not on ring. We ask people to be discreet in their conversations. But even before we had the ability to allow people to use their cell phones, people were using satellite phones on the aircraft anyway that the airline provided. Some of these governmental debates about the use of personal phones versus the use of satellite phones I think frankly doesn't make sense.
Is the cell phone capability available across the water?
Yes. Our systems are satellite-based systems. It's not on all our aircraft at the moment, but we're progressively fitting those systems out.
Is that available on your U.S. routes?
It is, because we tend to operate Airbus A380s on New York and Boeing B777-300ER or Boeing B777-200LR on the rest of the routes. Most of those aircraft have that capability.
You've also launched Wi-Fi on A380s.
It is relatively new, but it seems to be working well and we seem to be getting positive comments. I think it's a really useful thing, but also some people like the peace and quiet of getting away from emails for a while. I travel like everybody else and I get a lot of emails, and there are times when I really appreciate being on one of our flights and getting some peace and quiet.
Emirates is firmly unaligned when it comes to the major alliances. What is your partnership strategy in the United States?
We've been working with Alaska Airlines, JetBlue and Virgin America. We're not averse to working with other carriers on a bilateral basis—we never have been. Where we feel quite uncomfortable with a lot of these alliances ... I think it's a fairly thin line as to whether or not alliances are cartels or whether there are antirust implications. That we find a bit worrying.
Alliances have become more tightly integrated through antirust-immune joint ventures, especially across the Atlantic. How does Emirates fit in that world?
It really hasn't been too much of a threat to us. At the end of the day, they may think it's good for them. But for us, we're happy to go our own independent way, and it doesn’t stop people from wanting to use Emirates.
What's your GDS approach?
We're still very much on the GDS shelf. Obviously there are one or two alternative systems around, but at the end of the day the functionality of the GDSs and use of the GDSs is not just something you can ignore. I think we have good relationships with all the GDSs. We haven't had contentious relationships like some carriers.
What are some of those alternative systems?
We've used Farelogix in one or two parts of the world, but not really very much in North America. In one or two parts of Africa, Farelogix can come into its own for various reasons, partly in terms of where you have agents who are quite remote in parts of Africa who want to ticket. You want to be able to control the credit and ticket issuance. Farelogix works very well like that. And in areas where they don't need quite as sophisticated types of transactions, Farelogix does quite well.
Has your successor been named at this point?
Not yet. I've been 44 years in the airline industry, and I think it's time to go. I've had a terrific career. I've been very fortunate and have only worked for two airlines: British Airways for nearly 25 years and Emirates for nearly 20 years. I think in the airline industry, not many people can say that these days.
Is this a proper retirement or just a retirement from Emirates?
I may do some consulting work, but we'll see.
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