The grounding of 737 Max airplanes has cost Emirates and its partner a “lot of profitability” and Airbus planes could now replace some Boeing orders, the Middle East airline’s CEO and chairman said Monday.
Ahmed bin Saeed Al Maktoum said Flydubai, a regional partner of Emirates, has had to stop using 40 aircraft due to the worldwide grounding of the 737 Max aircraft following two deadly crashes involving the model. The CEO added that with more than 100 Max 8 planes currently on order, he couldn’t “sit and do nothing” and needed to look at options such as the Airbus A320.
“I have to look into a similar type of aircraft, let’s say with the Airbus,” Al Maktoum told CNBC’s Dan Murphy at the Arabian Travel Market trade show in Dubai on Monday.
The Emirates chief said he would “always demand that we be compensated,” but would not yet take the step of officially canceling orders.
When asked how the Boeing crashes could affect the aerospace sector, Al Maktoum said he expected a lot of pressure on the U.S. Federal Aviation Authority (FAA) to be more candid about how it certifies Boeing aircraft.
An Emirates Airbus A380 docked at Dusseldorf Airport in Germany on August 21, 2018.
Nicolas Economou | NurPhoto | Getty Images
In February, Airbus announced an end to its A380 superjumbo program, just 12 years after it first took to the skies.
The future of the world’s largest commercial jet-liner had long been in doubt after it became clear that it was heavily reliant on big purchases from Emirates.
Al Maktoum said the rise of more efficient aircraft had obviously impacted upon the success of the A380, but Airbus’ decision to end the program wouldn’t negatively affect the airline’s relationship with the planemaker.
“That will not change. At the end of the day, they are running a business,” said Al Maktoum before adding that he expected to see the superjumbo in Emirates colors for at least another decade.
“We are today at 107 aircraft, it will go up to 125 before we see that some of the older aircraft come out of the fleet,” he said.
Premium economy rollout
Meanwhile, Emirates has now confirmed a major rollout of premium economy seating will occur from some point in 2020. Al Maktoum hinted that market demand for this class of service between economy and business had pressured Emirates into a change of strategy.
“We have always to follow what the customer wants, not to offer what we like,” he told CNBC.
Earlier Monday, Emirates said political tensions in the region and elsewhere had slowed the growth of the airline. “We’ve managed to come ahead with positive results, although it’s not as good as it has been in the past,” President Tim Clark told Reuters.
Emirates is due to report full-year results on May 9.