Qantas’ struggles have hindered Dubai from benefiting from the carrier’s partnership with Emirates Airline. Brendon Thorne / Bloomberg News
Qantas’ struggles have hindered Dubai from benefiting from the carrier’s partnership with Emirates Airline. Brendon Thorne / Bloomberg News

Emirates Airline the clear winner in Qantas partnership



A year ago yesterday, Emirates Airline and Australia's Qantas launched their partnership with a breathtaking double-A380 fly-by over Sydney Harbour.

Unsurprisingly, Emirates is already a bigger winner in an alliance that resulted in a switch of the stopover for Qantas long-haul flights to Dubai from Singapore, helping to boost passenger traffic at Dubai International Airport by 11.7 per cent in February compared to a year earlier.

Government data last week also showed that Australasia was the fastest-growing market for passenger traffic at Dubai International, increasing by 30.5 per cent on the back of the tie-up.

Emirates has already leveraged its relationship with Qantas to expand its market share in Asia-Pacific. In February it signed a codeshare agreement with Jetstar, Qantas’s low-cost unit. Emirates said the agreement would give its passengers access to 27 new routes and six new destinations in Australia, New Zealand and Asia.

“Qantas needs Emirates more than Emirates needs Qantas,” said Will Horton, a senior analyst at the Sydney-based Centre for Aviation (Capa).”Emirates certainly had no problems being successful in Australia before the Qantas partnership.”

The Australian carrier is struggling with financial woes, ironically brought on by fierce competition from Gulf carriers including Emirates.

Known as the flying kangaroo, Qantas in February reported a loss of A$235 million (Dh771.4m) for the second half of last year, compared to a profit of A$109m a year earlier. The company said it would cut 5,000 jobs from its total workforce of 32,000.

“Qantas is a structural mess and no one wants to touch it with a bargepole. And quite rightly, too. Qantas represents everything that is wrong in how to run an airline,” said Saj Ahmad, the chief analyst at StrategicAero Research.

However, in a sign that Qantas has come to accept the need for a full reckoning, the airline has begun to cut costs. Qantas said it was planning to sell or defer the purchase of 50 aircraft and defer orders for eight Airbus A380s and three Boeing 787 Dreamliners that it had ordered for Jetstar.

“The situation with Qantas is severe, but there is a path ahead, although that requires much restructuring, which Qantas is starting to do,” said Mr Horton.

Hit by high fuel costs, aggressive competition and slow international demand, Qantas also faces tough competition at home, highlighted by a price war with Virgin Australia, a partner of Etihad Airways.

“Any increased exposure in Virgin will mean Etihad will be more exposed to any turbulent times ahead, but Etihad has made clear this is a long-term investment,” said Mr Horton.

However, unlike Virgin Australia, which is majority owned by Etihad, Air New Zealand and Singapore Airlines, Qantas by law must stay primarily in Australian hands.

James Hogan, the Etihad chief executive, has said the Abu Dhabi carrier might increase its stake in Virgin. Yesterday, Singapore Airlines raised its stake in Virgin to 22.1 per cent from 19.8 per cent.

“Qantas is an inept and inefficient dinosaur like many European Union and United States airlines, and Etihad can push Virgin Australia to hit Qantas where it hurts while also poaching international traffic,” Mr Ahmad said.

The Australian government is weighing the removal of a 49 per cent cap on foreign ownership in Qantas, a proposal that is being challenged by opposition parties such as Labor and the Greens.

“Emirates won’t be affected by Qantas’s ownership laws since Emirates has stated quite clearly it isn’t interested in buying any airline stakes – least of all Qantas,” Mr Ahmad said.

But the potential downside for their partnership, which lasts for another four years, is the arrival of an investor who would change the current status quo.

“Any potential future investor in Qantas would want Qantas to maximise its potential, which the Emirates partnership can help do,” said Mr Horton.

“But the risk is if an investor is an airline in an overlapping market, such as an Asian airline serving Australia and Europe. That airline may want some of Qantas’s Europe traffic routed away from Dubai,” he added.

However, despite Emirates’ lack of interest in investing in other carriers, its strategy is not written in stone.

The Emirates president, Tim Clark, said last month: “We have no plans at the moment to buy stakes in other airlines. I never say never because I’m not going to be always sitting here forever, so others coming after me may say that’s what they want to do. I don’t know.”

selgazzar@thenational.ae

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THE SPECS

Engine: 3.5-litre supercharged V6

Power: 416hp at 7,000rpm

Torque: 410Nm at 3,500rpm

Transmission: 6-speed manual

Fuel consumption: 10.2 l/100km

Price: Dh375,000 

On sale: now 

In numbers: China in Dubai

The number of Chinese people living in Dubai: An estimated 200,000

Number of Chinese people in International City: Almost 50,000

Daily visitors to Dragon Mart in 2018/19: 120,000

Daily visitors to Dragon Mart in 2010: 20,000

Percentage increase in visitors in eight years: 500 per cent

VERSTAPPEN'S FIRSTS

Youngest F1 driver (17 years 3 days Japan 2014)
Youngest driver to start an F1 race (17 years 166 days – Australia 2015)
Youngest F1 driver to score points (17 years 180 days - Malaysia 2015)
Youngest driver to lead an F1 race (18 years 228 days – Spain 2016)
Youngest driver to set an F1 fastest lap (19 years 44 days – Brazil 2016)
Youngest on F1 podium finish (18 years 228 days – Spain 2016)
Youngest F1 winner (18 years 228 days – Spain 2016)
Youngest multiple F1 race winner (Mexico 2017/18)
Youngest F1 driver to win the same race (Mexico 2017/18)

Key changes

Commission caps

For life insurance products with a savings component, Peter Hodgins of Clyde & Co said different caps apply to the saving and protection elements:

• For the saving component, a cap of 4.5 per cent of the annualised premium per year (which may not exceed 90 per cent of the annualised premium over the policy term). 

• On the protection component, there is a cap  of 10 per cent of the annualised premium per year (which may not exceed 160 per cent of the annualised premium over the policy term).

• Indemnity commission, the amount of commission that can be advanced to a product salesperson, can be 50 per cent of the annualised premium for the first year or 50 per cent of the total commissions on the policy calculated. 

• The remaining commission after deduction of the indemnity commission is paid equally over the premium payment term.

• For pure protection products, which only offer a life insurance component, the maximum commission will be 10 per cent of the annualised premium multiplied by the length of the policy in years.

Disclosure

Customers must now be provided with a full illustration of the product they are buying to ensure they understand the potential returns on savings products as well as the effects of any charges. There is also a “free-look” period of 30 days, where insurers must provide a full refund if the buyer wishes to cancel the policy.

“The illustration should provide for at least two scenarios to illustrate the performance of the product,” said Mr Hodgins. “All illustrations are required to be signed by the customer.”

Another illustration must outline surrender charges to ensure they understand the costs of exiting a fixed-term product early.

Illustrations must also be kept updatedand insurers must provide information on the top five investment funds available annually, including at least five years' performance data.

“This may be segregated based on the risk appetite of the customer (in which case, the top five funds for each segment must be provided),” said Mr Hodgins.

Product providers must also disclose the ratio of protection benefit to savings benefits. If a protection benefit ratio is less than 10 per cent "the product must carry a warning stating that it has limited or no protection benefit" Mr Hodgins added.

The five pillars of Islam

1. Fasting

2. Prayer

3. Hajj

4. Shahada

5. Zakat 

The five pillars of Islam

1. Fasting

2. Prayer

3. Hajj

4. Shahada

5. Zakat

MATCH INFO

Southampton 0
Manchester City 1
(Sterling 16')

Man of the match: Kevin de Bruyne (Manchester City)

How to avoid getting scammed
  • Never click on links provided via app or SMS, even if they seem to come from authorised senders at first glance
  • Always double-check the authenticity of websites
  • Enable Two-Factor Authentication (2FA) for all your working and personal services
  • Only use official links published by the respective entity
  • Double-check the web addresses to reduce exposure to fake sites created with domain names containing spelling errors
UAE athletes heading to Paris 2024

Equestrian
Abdullah Humaid Al Muhairi, Abdullah Al Marri, Omar Al Marzooqi, Salem Al Suwaidi, and Ali Al Karbi (four to be selected).
Judo
Men: Narmandakh Bayanmunkh (66kg), Nugzari Tatalashvili (81kg), Aram Grigorian (90kg), Dzhafar Kostoev (100kg), Magomedomar Magomedomarov (+100kg); women's Khorloodoi Bishrelt (52kg).

Cycling
Safia Al Sayegh (women's road race).

Swimming
Men: Yousef Rashid Al Matroushi (100m freestyle); women: Maha Abdullah Al Shehi (200m freestyle).

Athletics
Maryam Mohammed Al Farsi (women's 100 metres).

Avengers: Endgame

Directors: Anthony Russo, Joe Russo

Starring: Robert Downey Jr, Chris Evans, Scarlett Johansson, Chris Hemsworth, Josh Brolin

4/5 stars 

Founders: Abdulmajeed Alsukhan, Turki Bin Zarah and Abdulmohsen Albabtain.

Based: Riyadh

Offices: UAE, Vietnam and Germany

Founded: September, 2020

Number of employees: 70

Sector: FinTech, online payment solutions

Funding to date: $116m in two funding rounds  

Investors: Checkout.com, Impact46, Vision Ventures, Wealth Well, Seedra, Khwarizmi, Hala Ventures, Nama Ventures and family offices

The specs: 2018 Nissan 370Z Nismo

The specs: 2018 Nissan 370Z Nismo
Price, base / as tested: Dh182,178
Engine: 3.7-litre V6
Power: 350hp @ 7,400rpm
Torque: 374Nm @ 5,200rpm
Transmission: Seven-speed automatic
​​​​​​​Fuel consumption, combined: 10.5L / 100km

Sweet Tooth

Creator: Jim Mickle
Starring: Christian Convery, Nonso Anozie, Adeel Akhtar, Stefania LaVie Owen
Rating: 2.5/5


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