Etihad Airways is revising its growth targets upwards to carry 38 million passengers by 2030, from a previous goal of 33 million, as it seeks to bring more point-to-point traffic to the UAE capital.
The Abu Dhabi-based airline aims to expand 15 per cent every year until the end of the decade as it carries more passengers, adds 20 planes annually and reaps benefits from joint venture partnerships with Ethiopian Airlines and China Eastern, Antonoaldo Neves, Etihad's chief executive, told The National.
The revised growth plans prompted the airline to place an order in May for 28 Boeing wide-body aircraft, a mix of 787s and 777Xs, during US President Donald Trump's visit to Abu Dhabi.
"The plan that we have today is for 38 million passengers...the Boeing order that we put is to get to that objective," Mr Neves said.
"The strategy to bring more people into Abu Dhabi, to improve customer service and to provide people with more choice on the network is working very well. We're confident," he said, citing the 7.5 per cent surge in Abu Dhabi's population to more than four million last year.
Etihad had outlined plans for its so-called Journey 2030, a seven-year growth agenda announced in November 2023 when it marked its 20th anniversary. The strategy calls for doubling its fleet to 170 planes and tripling the number of passengers it carries annually to 33 million as it expands its global route network. In 2024, the airline carried 18.5 million passengers.
Sustainable growth
This year, Etihad will take delivery of 22 planes and has announced a flurry of new destinations. It launched inaugural flights to four new destinations this year – Prague, Warsaw, Sochi and Atlanta – and is set to add another 13 routes before the year closes. On Tuesday, it announced an additional seven new destinations with a focus on the Caucasus and Central Asia.
Asked if the rapid rate of network expansion was sustainable, Mr Neves said he was "confident" that this level of growth is manageable.
"There's not a single week that I don't think about growth and safety and financial profitability," the airline boss said. "These are the three things that are always on my mind."
Etihad Airways is "bigger and stronger" than ever before, hitting this week the mark of 20 million passengers flown in a 12-month period for the first time in its history, he added.
The airline chief is "happy" with the company's second-quarter financial results, which are yet to be announced, while prospects for the second half of the year "are good".
This comes despite airspace closures around the Middle East because of the geopolitical conflict that have created operational challenges for airlines serving the region.
"We've been able to manage the geopolitical situation that we had very well, so we're confident in terms of the results for this year," Mr Neves said.
The airline's profit margins and customer service levels are improving, while its safety standards are at an "all-time high," he said.
"We're going to keep up the growth that we have for the next five years...it's something that we can swallow and it gets easier as we grow," he said. "We've been over-delivering on the growth [targets] every single year."
Etihad Airways, for example, had previously set a target of 18 million passengers by 2027, which it has reached at the end of 2024, he said.
While the airline has announced a flurry of new routes, it is using about two-thirds of its additional capacity to increase the number of flights on existing routes, he said.
Etihad Airways on Tuesday said it is introducing flights to Almaty, Baku, Bucharest, Madinah, Tbilisi, Tashkent and Yerevan.
The announcement came a day after low-cost carrier Wizz Air said it will exit its operations in Abu Dhabi, citing several operational challenges. Routes it was serving included Almaty, Baku, Bucharest, Tashkent, Madinah and Yerevan.
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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.”
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How the UAE gratuity payment is calculated now
Employees leaving an organisation are entitled to an end-of-service gratuity after completing at least one year of service.
The tenure is calculated on the number of days worked and does not include lengthy leave periods, such as a sabbatical. If you have worked for a company between one and five years, you are paid 21 days of pay based on your final basic salary. After five years, however, you are entitled to 30 days of pay. The total lump sum you receive is based on the duration of your employment.
1. For those who have worked between one and five years, on a basic salary of Dh10,000 (calculation based on 30 days):
a. Dh10,000 ÷ 30 = Dh333.33. Your daily wage is Dh333.33
b. Dh333.33 x 21 = Dh7,000. So 21 days salary equates to Dh7,000 in gratuity entitlement for each year of service. Multiply this figure for every year of service up to five years.
2. For those who have worked more than five years
c. 333.33 x 30 = Dh10,000. So 30 days’ salary is Dh10,000 in gratuity entitlement for each year of service.
Note: The maximum figure cannot exceed two years total salary figure.
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Tickets start at Dh100 for adults, while children can enter free on the opening day. For more information, visit www.mubadalawtc.com.
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3. Valtteri Bottas, Mercedes - 212
4. Daniel Ricciardo, Red Bull - 162
5. Kimi Raikkonen, Ferrari - 138
6. Sergio Perez, Force India - 68
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Countries offering golden visas
UK
Innovator Founder Visa is aimed at those who can demonstrate relevant experience in business and sufficient investment funds to set up and scale up a new business in the UK. It offers permanent residence after three years.
Germany
Investing or establishing a business in Germany offers you a residence permit, which eventually leads to citizenship. The investment must meet an economic need and you have to have lived in Germany for five years to become a citizen.
Italy
The scheme is designed for foreign investors committed to making a significant contribution to the economy. Requires a minimum investment of €250,000 which can rise to €2 million.
Switzerland
Residence Programme offers residence to applicants and their families through economic contributions. The applicant must agree to pay an annual lump sum in tax.
Canada
Start-Up Visa Programme allows foreign entrepreneurs the opportunity to create a business in Canada and apply for permanent residence.
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Labour dispute
The insured employee may still file an ILOE claim even if a labour dispute is ongoing post termination, but the insurer may suspend or reject payment, until the courts resolve the dispute, especially if the reason for termination is contested. The outcome of the labour court proceedings can directly affect eligibility.
- Abdullah Ishnaneh, Partner, BSA Law
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