Passenger focus key to Etihad’s growth

Etihad’s new CEO James Hogan tells RORY THOMSON the next three years will be a period of consolidation to ensure the kind of consistent results that bring passengers back again and again
Hogan: intends to make Etihad a serious commercial venture

Etihad Airways has made ‘immense progress’ since its launch in 2003 and will be profitable in 2010, says CEO James Hogan.

“In just a few years we have achieved a global brand and, in my opinion, deliver one of the best inflight service experiences of any major airline in the world.”
This is backed by the numbers as well, with premium cabin space on key routes to Australia, Europe and the USA standing at exceptional levels – up to 80 per cent on the Sydney route alone.
One of the advantages, Hogan concedes – or perhaps exults in – is the fact that Etihad started with a blank sheet of paper with no embedded legacy systems that needed to be changed to meet today’s challenges.
So how will Hogan and his team move the airline forward? It will be in focussing on the passenger’s needs and requirements – on time performance, connectivity, the inflight experience and network development over the Abu Dhabi hub. The next three years will be a period of consolidation as it tries to ensure the consistency of performance that will keep the customers coming back.
Essential to this is the strategy of double daily connectivity on both East and West directions over Abu Dhabi. Already the airline has established one of the fastest passage times from Sydney to London. Luck is not part of this achievement, more it is the capabilities of the airline’s new fleet and Abu Dhabi’s geographic location that may soon eclipse the traditional ‘Kangaroo route’ hubs of Singapore and Hong Kong.
The Etihad fleet is brand new, with just the two leased Airbus A 330s to be moved on as and when new aircraft roll off the production line. All of the new aircraft in service and on order are or will be equipped to the highest standards. Both first class and business class (or Diamond and Pearl in Etihad parlance) feature flat beds while the economy (Coral) offering has one of the most comfortable seats and cabin space of any airline in the world. Having said that, the airline will undertake a massive redesign of its inflight cabin service and procedures towards the end of this year with a view to match the aspirations of the brand and its performance. Germane to this is the impending employment of 700 cabin crew, which will bring the number up to 2000. Existing cabin crew will also undergo re-training.
Likewise the pilots’ lot will be improved, as Etihad is looking to improve what Hogan describes the ‘pilot proposition’ to ensure that the very best professionals are lured to the shores of Gulf.
Positioning itself as the airline of Abu Dhabi throws up a number of challenges for Etihad. The elephant in the sitting room is obviously Emirates Airline a bare two hours up the road in Dubai… but Hogan is confident that with Etihad’s service quality and the accessibility of Abu Dhabi airport for the other emirates in the federation, he is well set to accommodate the needs of his Emirati customers. Meanwhile the rest of the region beckons as Hogan sees his catchment area encompassing the GCC states, Iran, the Indian sub continent and the greater Middle East and North Africa.
A reflection of this commitment to the region is Etihad’s pending decision to buy narrow body jets to service some the less well populated – or served – cities in the region with immediate connections to longer haul destinations in wide bodied aircraft.
With the backing of the government of Abu Dhabi there is another consideration – where is Abu Dhabi on a world map? And, although his board intends to make Etihad a serious commercial venture, Hogan is himself committed to making Abu Dhabi a world-renowned name in the way that many other capital cities have – moving on from hub to stopover, and ultimately, destination status. This may involve owning or establishing partnerships in hotels in Abu Dhabi to fulfil the needs of passengers who transit through Abu Dhabi and want to take advantage of the facilities the fast growing and sophisticated city can offer.
Fleet acquisition is another challenge. Although committed to the Airbus 380 in the long term, Hogan is sanguine about delivery dates and will introduce the aircraft in or around the 2010 mark. Meanwhile there will be a RFI (request for information) sent to the major manufacturers in 2008 followed by a likely RFP (request for proposal) in 2009. Likely candidates for selection are Boeing’s 787 or the Airbus A 350.
Hogan reportedly told media recently that the airline plans to acquire up to eight or nine single-aisle planes in 2008.