Disruptions at Dubai likely to hit local flights
Emirates concedes disruptions to its worldwide network will be inevitable next year due to urgent runway repairs at Dubai Airport but has yet to determine the extent of the impact on routes to Australia.
About 2500 departures - or 31 services a day - will be cancelled at the world's second-busiest international airport over 81 days next year while repairs are carried out on two runways. The cancellations represent about 14 per cent of flight departures from Dubai.
The airport is yet to finalise the allocation of slots for scores of airlines during the outage but Emirates executive Barry Brown said it would inevitably lead to disruptions.
"We're trying to manage whatever slots are being handed out to us. If we have to make cancellations on certain routes, we will do that," he said. "There will be a bit of pain."
Emirates has 84 services a week between Dubai and Australian cities which makes it the third-biggest international operator after Qantas and Singapore Airlines.
Mr Brown declined to say what impact it was likely to have on Emirates flights to Australia.
However, he said the addition of more A380 superjumbos to Emirates' fleet would help offset the reduced number of flights permitted at Dubai during the three-month period because they can carry more passengers.
Dubai has also become Qantas' main hub for flights to Europe since its alliance with Emirates began in March.
Qantas believes it will be able to retain all its 28 weekly landing slots at Dubai but has said the runway closures may require changes to the timing of its twice-daily flights to Europe.
Mr Brown said neither Emirates nor Qantas would receive preferential treatment from airport authorities in the allocation of landing slots. Between them, the pair control more than half of the market share of passengers who fly between Australia and Europe.
After showing the strain of an influx of large aircraft such as A380s, Dubai Airport will carry out extensive repair work from May, including laying 180,000 tonnes of asphalt on its northern runway.
Like other airlines, Mr Brown said Emirates faced a "mini perfect storm" on international routes worldwide with excess flight capacity, heavy discounting of fares and high jet fuel prices.
"Fuel continues to be a red spike on the balance sheet ... and trading conditions are very difficult, and because of that, prices have come down, particularly with capacity increases into Australia," he said.
"Airlines are vying for market share. You are seeing bigger, wider-body aircraft come in."
But he emphasised that the alliance with Qantas had boosted the number of passengers in Emirates business and first-class cabins on routes to and from Australia, helping to offset lower margins on economy tickets.
He declined to put a figure on the financial gains from the Qantas alliance but said the "strength in the premium cabins is hugely noticeable" from the tie-up.
While it might consider flying to more Australian destinations in the longer term, Mr Brown said Emirates was most likely to use larger aircraft on existing routes than increase the frequency of its services.