An Emirates Airlines A380 Airbus takes off in Dubai.
An Emirates Airlines A380 Airbus takes off in Dubai.
An Emirates Airlines A380 Airbus takes off in Dubai.
An Emirates Airlines A380 Airbus takes off in Dubai.

Emirates to check A380 fleet after new wing crack reports


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Emirates says its fleet of A380 superjumbo passenger jets remain airworthy despite reports emerging that more cracks have been found on a wing component in recent inspections on this type of aircraft.

It is not known in which airline's aircraft the new cracks were found. The Reuters news agency is citing industry sources that the new cracks are different from the two types of cracks discovered within weeks of each of other on the same type of part inside the wing.

Airlines have until Friday to complete a first phase of tests for the most heavily used category of aircraft, with at least 1,800 take-offs and landings.

Airbus, the aircraft's manufacturer, insisted that the world's largest passenger plane is safe to fly.

European safety authorities ordered urgent inspections on just under a third of the superjumbo fleet last week after two types of cracks were found in an L-shaped bracket inside the wing.

Since then, similar cracks have been found inside the 9,100-square-foot wing of at least one of the superjumbos examined under the directive, industry sources said.

The latest findings came as it emerged that cracks on a bracket in another part of the wing were discovered two years ago.

The problem was documented at the time but went unnoticed outside the industry.

Airbus said on Tuesday this was a different issue from the latest flaws and had been resolved.

There are 2,000 brackets in each wing, which is constructed around a rib cage and attached to the wing's skeleton with brackets known as rib feet. The most recent cracks surfaced in this type of bracket.

The crack spotted in 2010 showed up on a bracket in part of the wing specially designed to help the huge airliner climb more steeply at take-off and obey noise restrictions.

"We have clear evidence that the airworthiness process is working," a spokesman for the EADS EAD.PA subsidiary was quoted by Reuters.

"An issue has been found, we reported it, we made a recommendation to our customers, the European Aviation Safety Agency (EASA) made it mandatory and the inspection and fix if necessary are both under way."

Today Emirates restated it position that it was fully complying with EASA's request for checks.

"The directive poses no impact on Emirates operations," said the statement.

"The aircraft remain fully airworthy and pose no risk to flight safety as affirmed by EASA and Airbus. The safety of our passengers and crew is our highest priority."

nhanif@thenational.ae

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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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