An Emirates Etihad Merger Is Not As Ridiculous As It May Once Have Been
It has been reported internationally that the possibility of a merger between the UAE’s two major airlines has being discussed.
Emirates, who operate from Dubai and Etihad the airline of Abu Dhabi are both premium long-haul airlines facing an uncertain future. With energy prices in decline and growing competition from low-cost airlines now focusing on budget travel for long haul routes, the two-state owned carriers may have some difficult decisions to make.
Tim Clark, CEO of Emirates has hinted at a ‘gathering storm’
This week, the CEO of Emirates hinted at a ‘gathering storm’ in the premium airline industry, he discussed the major factors facing airlines such as Emirates, namely competition from low-cost airlines who are now targeting international routes (and now beginning to offer long-haul flights at low costs) and political upheavals causing complications for airlines now more so than ever before (since the recent travel ban by POTUS Donald Trump, Emirates airline has seen a 25% decline in booking rates).
An report from a European news source stated the possibility of a merger
Handelsblatt, a European Business Daily news has reported that the ruling families have met to discuss a merger. Falling profits and a changing industry with an uncertain future are cited as the reasons behind the discussions although neither Etihad or Emirates have confirmed the reports.
This is not the first time rumours of a merger have been discussed
In the financial crisis of 2008 there were rumours of the two airlines merging, which is clear were false. What is clear from recent news reports is that both airlines are facing a challenging time in an unstable business environment for airline carriers. The two major airlines serving Dubai and Abu Dhabi are just 70km apart, and whether there’s need for the two major carriers in close proximity remains to be seen.