Thanks Anna for the great question. On state subsidies, I would say its a grey area. If you are talking about oil prices, in general jet fuel in middle-east is cheaper than other parts of the world. And all the airlines landing into middle-east airports can get this cheaper jet fuel. Having said that in my opinion, no offense, even American Airlines got “subsidized” by the government when they filed chapter 11 bankruptcy.
Emirates is making use of open sky policy while U.S. and European airlines are not making use of the same policy to that extent. Emirates buys new aircrafts continuously and has to deploy them somewhere in the world and as such Emirates is expanding its own network.
These are really great questions Andres. Kindly find my responses below:
Competitors (middle-east airlines) will not be able to match capacity deployed by the Emirates. There was an article last which compared total number of seats deployed by middle-east airlines. Quick quote from this article:
“In terms of weekly seats, Emirates’ advantage over Qatar Airways is 116% and 278% over Etihad. This reflects the fact that Emirates operates an all widebody fleet, while both Qatar Airways and Etihad operate a significant number of narrowbody aircraft. Another way of looking at this is that in terms of weekly seats Emirates is 37% bigger than Qatar Airways and Etihad combined.”
So the best way to pull customers from Emirates is to deliver on customer service. From my experience, I have seen many customers moved to Qatar Airways just because of better inflight experience. Small example – B777 of Qatar Airways has nine seats in a row while Emirates has ten seats in a row. With one seat less, it gives more space for customer to move around and is much better during long haul flights.
Emirates will not be a part of any larger alliances. Emirates strategy is different. They want to build their own customer base and they want to expand by themselves.
Other good examples of state owned airlines – Qantas and Cathay Pacific.
This is really impressive operating model for FedEx. Sorting packages from all 140 aircrafts and passing right packages to right destination aircraft needs highly efficient and more importantly effective operations setup. Thanks for sharing the video for US operations. On that, it raises two questions:
1) Does FedEx have same efficient operating model at international hubs?
2) Is FedEx planning to expand its network through more international hubs or the company does not feel the need for it at this stage?
This is awesome post Sarah! Talking about inflight customer experience, based on my experience, these days it is the key differentiating factor among various airlines and I have come across lots of customers who choose an airline to fly with just for the inflight experience (even though fares are slightly on the higher side). It is completely visible that JetBlue is changing itself to suit new needs of travelers and to sustain itself in this low margin industry.
It would be interesting to see how JetBlue positions itself once it starts entering into the business market. Matching frequent flyer miles for each loyal customer on other airlines will be a challenge for JetBlue, so it will be interesting to see what strategy JetBlue will use to convert super loyal customers on other airlines and make them fly on JetBlue for business purposes.
This is awesome post Yukako! I have never thought that how efficient cleaning model can be and how effectively this model can be turned into a business. Also it is interesting to know that average age of people cleaning in 52 which in my opinion is relatively old age people and they are so efficient in this process.
Does TESSEI work only for bullet trains or it is planning to expand to other industries? From my experience, this model would fit in for Airlines also and Airlines will have faster turnaround rates for aircrafts if this is implemented.
This is really interesting post Gil! John Oliver’s video makes more interesting. Looking at the model, it raises couple of questions:
1) Unless I missed something or misunderstood, although FIFA claims its non-profit but if we look revenue minus cost, it seems they are making profits. This raises question whether are they really non-profit organization?
2) Also after Qatar bid scandal and how corrupt FIFA is (John Oliver’s comment in his video), above question exemplifies. To the best of my knowledge, FIFA is still going forward with Qatar as world cup venue. Do you think FIFA is still on its mission of being “non-profit”?
3) One of FIFA’s mission is “Build a better future” – Is this coming at the cost of number of employees who lost their lives and miserable lifestyles in Qatar while “working” for FIFA?
Ellian thanks for the comment. Emirates magic recipe to remain profitable is its location in Dubai. It is so centrally located between Eastern and Western world and Emirates is taking advantage of that. Due to this Emirates can play on volumes and hence its invests only in wide-body aircrafts Airbus 380s and Boeing 777s. Also Emirates does not have union problems to handle which plays big role in operations. Also, employee costs are lower at Emirates. For example, employee costs in Emirates is approximately 13% of revenue while at American Airlines is approximately 19%.