Etihad Airways aims to triple its number of passengers to 30 million and double its fleet to 150 planes by 2030 as it maps out the “next chapter of growth”, aided by its new planned airport terminal in Abu Dhabi, its chief executive said.
The Abu Dhabi-based airline plans to grow by 10 per cent annually in the next seven years in terms of number of passengers carried and available seats per kilometre, Antonoaldo Neves told The National.
The target is part of a 10-year strategy to focus on operating medium and long-haul flights in lucrative markets and shift away from ultra-long-haul routes, he said.
The plan is to connect travellers in China, India, Pakistan, South East Asia and the Gulf region to destinations in Europe and the east coast of the US via its Abu Dhabi hub in a restructuring of its network over the next decade, Mr Neves said.
Increasing flight frequencies to key European cities will also strengthen the network, while point-to-point traffic will further increase demand for visiting Abu Dhabi.
“It's the next chapter of growth,” Mr Neves said during an interview on Wednesday on the sidelines of the Arabian Travel Market in Dubai.
In October 2022, Etihad Aviation Group appointed Mr Neves, the former boss of Portuguese airline TAP, to succeed Tony Douglas as chief executive.
This came after the Abu Dhabi government transferred ownership of the Etihad Aviation Group — the parent of Etihad Airways — to holding company ADQ as part of efforts to transform the emirate into a global aviation hub.
Key priorities
Mr Neves is now focused on expanding the airline in a sustainable way.
Its Abu Dhabi government shareholder “has set the aspirations very high” and it is time to “grow again” after the airline's “downsize” over the last five years during its restructuring programme, he said.
“What we have to aspire to is to be one of the best airlines in the world, and I think we are, but we need to push the bar higher because everyone is pushing it higher and we cannot stop improving,” Mr Neves said.
“We need scale to do that and our customers want scale, they don't want us to have only one flight a day to Paris or Geneva. Size matters here as long as we're profitable.”
The priority is to be a financially sustainable airline and the short-term goal is to fix the network and structure the banks, an industry term for the peak arrival and departure timings at an airline's hub.
The airline targets carrying 30 million passengers by 2030, up from 10 million last year. It expects to ferry 13 million passengers in 2023, an increase of 23 per cent year-on-year, he said.
Etihad Airways also plans to grow its fleet to 150 planes by 2030 from about 70 jets flying currently and 80 aircraft by year-end.
“I don't see why the airline cannot double the fleet size over the next seven years,” Mr Neves said.
“The Gulf region is growing a lot and in developing economies, the number of passengers grows twice as much as GDP on average.”
This year, it will introduce 15 additional planes, a combination of jets returning to service and new deliveries. These include four Airbus A380s, six A320 and A321 narrow bodies, two Boeing 777s that are coming out of storage and three new 787s.
The airline is adding five to seven new destinations this year, including Lisbon, Dusseldorf, Kolkata, Copenhagen, Malaga and Mykonos, taking the total to 70 destinations.
“The network needs to be very well designed, I pay a lot of attention to that,” Mr Neves said.
“You have to fly the right aircraft to the right market at the right time and to perform the right mission.
“If you deploy the asset to the wrong destination, then the capital deployed is just crazy.”
Jet orders
Asked if Etihad Airways was considering a new aircraft order, Mr Neves said the plan to double the fleet will be done “hand-in-hand” with its joint venture partner Air Arabia Abu Dhabi, that currently has eight planes.
“Now we're debating how many planes we're going to have” under each operator, he said.
The executive said he will take a flexible approach to the fleet.
We will need more planes and when it's the right time, we're going to get these new orders but I'm not in a hurry to do that
Antonoaldo Neves,
Etihad Airways chief executive
“We're going to have to use the … planes coming from our old orders but we will need more planes and when it's the right time, we're going to get these new orders,” Mr Neves said. “But I'm not in a hurry to do that.”
The emirate's long-anticipated new midfield terminal at Abu Dhabi International Airport will enable the airline's next growth phase, he added.
“The new terminal is going to be amazing,” Mr Neves said. “The infrastructure we're going to get is going to be incredible, not only for the customers, but also for the network.”
Return to profitability
Last year, Etihad Airways swung to an annual profit amid a strong air cargo performance, Mr Neves said, without disclosing figures.
This followed a record first-half profit following a five-year restructuring programme that transformed it into a medium-sized airline as it reduced its fleet, network and workforce.
“We did well. Cargo was extremely profitable,” he said.
Asked if this year will also be profitable, he added: “We are working towards that.”
In the first quarter of 2023, the airline “did well” on the passenger side of the business, carrying about three million people during the first three months of the year, or 1.1 million per month, he said.
Looking at the remainder of the year, Mr Neves said passenger travel demand is “extremely strong” across leisure and business trips, with unexpectedly robust demand from Europe and the US.
“I am very confident this is here to stay,” he said.
Etihad currently has about 10,000 seats a week of unused flying rights between India and Abu Dhabi, putting it in a “good position” to expand into the country, compared to other peers in the region that are seeking more capacity in the Indian market, Mr Neves said.
The carrier is also planning to add more flights to China after the country reopened to international travel. “We have good partnerships with airlines and in cargo, China is important for us,” he said.
The airline is likely to return to its pre-pandemic network and capacity levels by 2025, according to the executive.
In terms of the impact of high inflation and oil prices on travel demand, he said that “you always have to be cautious, ready for change and agile”.
'Alignment' of values
Mr Neves said his vision for the airline's growth is aligned with that of ADQ. His focus is on “great” product and customer service across cabin classes, a strong network and operational efficiency.
“First and foremost, what brought me here is that I have a lot of alignment with the shareholder vision of ADQ,” he said. “It's much easier to deliver what we have to deliver when there's alignment on shared values.
“The starting point for me is that I only believe in airlines that are financially sustainable. I've been working my entire career to drive performance in organisations over the past 15 years in the aviation space.”
The executive, who also has a background in engineering and corporate finance, has started a weekly committee to assess customer satisfaction on “every point of the journey” to drive efficiency.
Etihad will build a competitive advantage through a great product, being the most efficient airline in the industry and attracting “the best team of people” in the region, he said.
“People are going to be dying to fly on us,” Mr Neves said.
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
THE BIO:
Favourite holiday destination: Thailand. I go every year and I’m obsessed with the fitness camps there.
Favourite book: Born to Run by Christopher McDougall. It’s an amazing story about barefoot running.
Favourite film: A League of their Own. I used to love watching it in my granny’s house when I was seven.
Personal motto: Believe it and you can achieve it.
KILLING OF QASSEM SULEIMANI
Results:
2.15pm: Handicap (PA) Dh60,000 1,200m.
Winner: AZ Dhabyan, Adam McLean (jockey), Saleha Al Ghurair (trainer).
2.45pm: Maiden (PA) Dh60,000 1,200m.
Winner: Ashton Tourettes, Sam Hitchcott, Ibrahim Aseel.
3.15pm: Conditions (PA) Dh60,000 2,000m.
Winner: Hareer Al Reef, Gerald Avranche, Abdallah Al Hammadi.
3.45pm: Maiden (PA) Dh60,000 1,700m.
Winner: Kenz Al Reef, Gerald Avranche, Abdallah Al Hammadi.
4.15pm: Sheikh Ahmed bin Rashid Al Maktoum Cup (TB) Dh 200,000 1,700m.
Winner: Mystique Moon, Sam Hitchcott, Doug Watson.
4.45pm: The Crown Prince Of Sharjah Cup Prestige (PA) Dh200,000 1,200m.
Winner: ES Ajeeb, Sam Hitchcott, Ibrahim Aseel.
RESULT
Wolves 1 (Traore 67')
Tottenham 2 (Moura 8', Vertonghen 90 1')
Man of the Match: Adama Traore (Wolves)
WHAT IS GRAPHENE?
It was discovered in 2004, when Russian-born Manchester scientists Andrei Geim and Kostya Novoselov were experimenting with sticky tape and graphite, the material used as lead in pencils.
Placing the tape on the graphite and peeling it, they managed to rip off thin flakes of carbon. In the beginning they got flakes consisting of many layers of graphene. But when they repeated the process many times, the flakes got thinner.
By separating the graphite fragments repeatedly, they managed to create flakes that were just one atom thick. Their experiment led to graphene being isolated for the very first time.
In 2010, Geim and Novoselov were awarded the Nobel Prize for Physics.
The specs: 2019 Audi A7 Sportback
Price, base: Dh315,000
Engine: 3.0-litre V6
Transmission: Seven-speed automatic
Power: 335hp @ 5,000rpm
Torque: 500Nm @ 1,370rpm
Fuel economy 5.9L / 100km
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
UAE currency: the story behind the money in your pockets
Our legal consultant
Name: Dr Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
