For an airline that plunged to a $1.95billion USD loss in 2016 and then went onto make further losses of $1.52billion last year, you’d expect Abu Dhabi-based Etihad Airways to just carry on cutting and cutting as much as possible in a bid to get back into the black. But while Etihad has made some pretty significant cutbacks in the last 18-months, its new business strategy is revealing a very different direction for the carrier.
The story of how Etihad got to this point is well documented – a desperate bid to grow into a dominant global airline, turning Abu Dhabi into a yet another Persian Gulf hub led to bad business decision after bad business decision. Billions of dollars were spent investing in struggling international airlines as part of Etihad’s failed attempt to create a fourth global airline alliance.
The future for Etihad looks set to be very different. We reported a few days ago on a management shakeup at the airline – the latest step in a business turnaround attempt to stem the losses at the State-owned carrier. Tony Douglas, the Etihad Airways Group CEO spoke of making the airline “more rational” – in other words, more cuts could come.
Further underperforming routes in Etihad’s shrinking global network could be cut. Smaller markets such as Edinburgh in Scotland and Perth, Western Australia have already been cut from Etihad’s schedules, while flight frequencies on other routes have been trimmed back.
Douglas hasn’t shied away from explaining the process, telling reporters: “Networks need to be reanalyzed. Years ago it would’ve been quarterly, today it needs to be almost minute by minute.”
“The eventual aim of this process is for Etihad to be in the best shape to ensure its long-term sustainability,” Douglas explains, going on to say that the shakeup will allow Etihad to “meet the challenges of an aviation industry in constant flux.”
Rumours that Etihad plans to delay, defer or cancel orders for 110 brand new aircraft it has on order with both Boeing and Airbus also look set to be confirmed at some point soon. With a shrinking network and much smaller ambitions, Etihad says it won’t need to grow its fleet like it had originally planned.
“We don’t believe that doubling the size is likely to be sustainable at this time,” Douglas says of the rumours.
Instead, Etihad plans to focus on serving its home of Abu Dhabi – bringing passengers to and from the oil-rich Emirate, rather than simply using it as a hub between other destinations. It appears that Etihad could once again turn into the small, boutique carrier that is said it didn’t want to be.
And it’s with that in mind that Etihad seems to be making some pretty unusual enhancements in an attempt to differentiate itself from its competitors. Services like its so-called ‘Flight Valet’ aren’t that unusual – a special cargo service for expensive supercars to be transported to European cities for the summer are relatively common in the Middle East.
But how about an in-flight nurse? Now, Etihad has had an onboard nanny for some time. Since the Flying Nannies programme started in 2013, Etihad has trained over 2,000 cabin crew to take on the additional task of looking after little ones – providing games and supporting stressed families on long-haul flights.
But this is very different. Appealing to wealthy Emirati locals, the new service will offer a fully trained nurse to provide medical support for passengers travelling with complex medical conditions – perhaps travelling overseas for medical treatment.
In addition, Etihad will also offer its own doctor to assess a passenger’s ‘fitness to fly’ before they get to the airport – issuing a certificate so that passengers can confidently board without being refused travel by cabin crew or ground staff.
The airline says it is the first carrier in the region to offer both services.
Unlike, the Flying Nannies, it’s probably important to point out that Etihad doesn’t plan to have a medical nurse onboard all its flights. They’ll be booked for individual passengers and they won’t be trained as cabin crew like the nannies.
This is a really interesting move from Etihad and it looks like the airline is planning to advance some aspects of the passenger experience. This will certainly be welcome after the airline has made so many cutbacks in the last year and a half.
