The Emirates Group
The Emirates Group is a state-owned Dubai-based international aviation holding company headquartered in Garhoud, Dubai, United Arab Emirates, near Dubai International Airport. The Emirates Group comprises dnata, an aviation services company providing ground handling services at 126 airports, and Emirates, the largest airline in the Middle East. Emirates flies to over 150 destinations across 6 continents, operating a fleet of over 250 wide-bodied aircraft. The airline has 170 aircraft on order worth US$58 billion. The Emirates Group has a turnover of approximately US$28.3 billion and employs over 105,000 employees across all its business units and associated firms, making it one of the biggest employers in the Middle East. The company is wholly owned by the Government of Dubai directly under the Investment Corporation of Dubai and as part of Dubai Inc.
Head office
The airline's head office is in the Emirates Group building in Al-Garhoud, Dubai. The building is located on Airport Road, across from the site of the Emirates Engineering Centre built in 2007. A tunnel connects the building to Dubai International Airport. Construction of the building cost AED 700 million. Construction began in 2004 and was scheduled to end in 2007. Emirates self-financed the construction. Over 6,000 employees work in the building. Previously the airline's head office was the Airline Centre along the clock tower Roundabout in Dubai.History
Origins
As the British pulled out of Dubai in the late 1950s, Sheikh Saeed bin Maktoum al Maktoum decreed an open seas, open skies, and open trade policy, to develop the country. He also required all government agencies to make a profit. The country was aiming to eliminate its dependence on its finite oil reserves within 50 years.The Dubai National Air Transport Association was formed in 1959, and by the mid-1980s, it was employing 2,500 employees. It consisted of three business segments: Dnata Airport Operations, Dnata Cargo and Dnata Agencies. In addition to providing support services at Dubai International Airport, the company served as a sales agent for 26 airlines. Dubai had been used as a stopover on routes between Europe and the Far East since the days of Imperial Airways, which landed its flying boats there en route to Australia. The open skies policies kept its airport among the busiest in the Middle East.
During the mid-1980s, Gulf Air began to cut back its services to Dubai. As a result, Emirates was conceived in March 1985 with backing from Dubai's royal family, whose Dubai Royal Air Wing provided two of the airline's first aircraft, used Boeing 727-200/Advs. It was required to operate independently of government subsidies, apart from $10 million in start-up capital. It also leased a new Boeing 737-300 from Pakistan International Airlines which was returned in 1987. Maurice Flanagan was named managing director of the new airline. Formerly of the Royal Air Force, British Airways, and Gulf Air, Flanagan had been seconded to DNATA in 1978 on a two-year assignment as assistant general sales manager.
Chairman was Sheikh Ahmed bin Saeed Al Maktoum, nephew of the Ruler of Dubai, became chairman of Department of Civil Aviation and DNATA itself. Tim Clark joined the management team.
The first flight of the airline was, Dubai-Karachi on 25 October 1985. The airline leased an Airbus 300B4-200, from Pakistan International Airlines. Bombay and Delhi were the next destinations for the airline. Sheikh Mohammed bin Rashid al Maktoum later gifted two Boeing 727-200s to the airline.
The Emirates Group became profitable within its first nine months. During its first year, the airline carried about 260,000 passengers and 10,000 tons of freight. By 1986, the airline was adding new destinations such as Colombo, Dhaka, Amman, and Cairo to its route network.
In its second year the group posted a loss, but growth continued even as the region was experiencing a downturn a year later. The Gulf War and the laying off of expatriate workers as the main factors. In its second year, competitors had accused Emirates of starting a price war, something the airline's competitors still accuse Emirates of doing. On 3 July 1987, Emirates received its first bought Airbus A310-304, from Toulouse. Within the first 38 months of operating, Emirates was serving 12 destinations.
Emirates Sky Cargo, which operated as a separate entity, carried 25,000 tons of freight in fiscal 1989. Emirates expanded its route network into the Far East in 1990, and expanded its European operations in the summer of 1992. In 1990, the airline purchased three additional Airbus A310-300s from Airbus. The Group also launched Marhaba in December 1991 as a premium meet and greet service for passengers travelling through Dubai International Airport.
Growth
By the early 1990s, Emirates had become one of the fastest growing airlines globally. Its annual revenues increased by approximately $100 million, reaching around $500 million in 1993. That year, the airline transported 68,000 tons of cargo and 1.6 million passengers.The Gulf War had a significant impact on the regional aviation industry. During the final days of the conflict, Emirates was the only airline to continue operations, although its fleet was grounded temporarily in the winter of 1991 during the liberation of Kuwait. Services resumed a few weeks later.
In 1993, Emirates expanded its fleet with the addition of another Airbus A300-600R, bringing the total number of aircraft to nine. The same year, the airline placed an order for seven Boeing 777s, with an option for seven more, in a deal valued at approximately US$645.5 million. At its sixth anniversary, Emirates was transporting about 25,000 passengers weekly to 23 destinations. In 1994, it opened a new terminal at Dubai Airport, constructed at a cost of US$2 million.
Emirates also expanded its international presence through partnerships. In late 1993, it entered into an agreement with US Airways to broaden its service network. Prior to this, it had cooperative arrangements with Cyprus Airways. By 1994, Emirates operated 15 aircraft and served 32 destinations, ranking as the sixth largest airline in the Middle East at that time.
Emirates took in revenues of $643.4 million in the year ending 30 March 1994. The airline had 4,000 employees and carried two million passengers a year between 34 destinations with a fleet of 18 Airbus aircraft. In spite of the large capital expenditures, the Dubai government had laid out only $50 million since the airline's inception. In October 1995, the Emirates Group launched Mercator an IT company.
A total of 92 air carriers were flying to Dubai Airport and Emirates faced intense competition at its home base. It carried about three million passengers a year to Dubai International Airport in the mid-1990s. Emirates continued to expand during the late 1990s. The growing cargo business accounted for 16 percent of the airline's total revenues. By 1995, it has a fleet flying to 34 locations in the Middle East, Far East and Europe. Emirates also opened its own Flight Training Centre in 1995, and in 2017, its own Flight Training Academy.
In 1997, Emirates was flying a dedicated freighter to Amsterdam, a point not on its network of passenger routes, in cooperation with KLM. It carried about three million passengers during the year. The same year, Emirates made a $2 billion order for 16 Airbus A330-200s, and carried over three million passengers and 150,000 tonnes of cargo. The airline also took delivery of six Boeing 777-200s, giving it new long-haul capabilities.
Emirates opened a, $65 million training center in January 1997. The airline was then able to provide simulator training for its crew members and flight and maintenance personnel. A record group profit of AED 371 million was achieved in 1997–98. Emirates executives planned a slowdown in the airline's growth in the late 1990s to stabilize its expansive route network.
In May 1998, Emirates paid the Government of Sri Lanka $70 million for a 40 percent stake in SriLankan Airlines. As part of the deal, Emirates received a 10-year contract to manage SriLankan. In January 2008, Emirates announced that it would give back management of SriLankan Airlines to the Government of Sri Lanka, effective April 2008. Emirates sold its stake in SriLankan Airlines to the Government of Sri Lanka during June 2010.
In 1998, the airline opened a $540 million Terminal 2 at Dubai International Airport, increasing its capacity by 26 percent as passenger figures hit 3.7 million, while cargo levels went up to 200,000 tonnes. Galileo Emirates, was established to consolidate the distribution of the Galileo Reservation System in the existing markets of the UAE, Oman, Bahrain, Qatar, Pakistan and Sri Lanka.
In 1999, Emirates opened its own hotel – The Al Dossa Desert Resort. Emirates Group's workforce totalled 11,000 that year, and Dnata entered the South-East Asian airport services market with the launch of Dnata Philippines Inc. Emirates SkyCargo also launched a new system called Skychain developed by Mercator, which provided access via the Internet and email to everyone involved in moving a cargo.
Modern history
Emirates announced an order in April 2000 as the first launch customer for the Airbus A3XX, the largest civil aircraft ever built. The deal comprised five Airbus A380-800s and two Airbus A380-800F. The deal was confirmed on 4 November 2001 and Emirates announced orders for 15 more A380-800s at the same time. Also announced was an order for 6 Boeing 777s. Emirates justified its order by saying that purchasing the 481- to 656-passenger super jumbo to was to maximize its use of scarce takeoff and landing slots at crowded airports like London Heathrow. In the same year the new Sheikh Rashid Terminal opened, increasing the capacity at Dubai International to 22 million passengers a year. The loyalty program of Emirates, Skywards was also launched. Sheikh Ahmed also announced that Dubai Government is to invest $500–600m in the new Terminal 3 – with a capacity for 20 million passengers a year.Towards the end of 2000, Emirates was planning to start ultra-long-haul service to the East Coast and West Coast of the United States as well as nonstop flights to Australia and Argentina. Traffic continued to grow at a rate of 20 percent in 1999–2000.
In 2001, Emirates SkyCargo Centre opened with a capacity to handle 400,000 tonnes a year. Emirates was also voted airline of the year by research consultancy Skytrax. Emirates took delivery of its 18th Airbus A330-200 and ordered two more, making it the biggest A330 operator in the world. The airline also announced an order worth $15 billion for 15 Airbus A380s, eight Airbus A340-600s, three Airbus A330s and 25 Boeing 777s. A year later, the airline was again named airline of the year by Skytrax. Passenger level on Emirates in the 2001–02 financial year reached 6.3 million passengers, and cargo crossed 400,000 tonnes. The Group also announced a $275 million investment in new hangar complex at the Emirates Engineering Centre. Galileo Emirates was further expanded when the business acquired the distribution rights for Sudan and Tunisia.
In early 2003, the Emirates flight catering was formed out of Emirates Abela Catering Company. Emirates flight catering employed over 5,400 staff. In its first year, the catering company produced over 16 million meals with a daily average of 45,000 meals. In the end of 2003, Emirates ordered 71 aircraft at a cost of $19 billion.
In the financial year ending March 2003, Emirates carried 8.5 million passengers, an increase of 26%, and the airline posted an increase in profits of 94 per cent to Dhs907 million from Dhs468 million from the previous year. Dnata also launched its services in Kuwait.
In 2004, Emirates ordered four Boeing 777-300ERs, with nine options, in a $2.96 billion deal. The SkyCargo fleet is increased with three Airbus A310-300s added to its six Boeing 747s. Emirates also signed a £100 million deal with English Premiership side Arsenal, which included the naming rights to its new stadium for 15 years and shirt sponsorship for eight years, starting from the 2006/07 season. By the end of 2003, Dnata began operations in Kuwait.
In 2005, the Emirates Group workforce totaled 25,000, making it Dubai's largest employer. Passenger traffic also continued to rise with 12.5 million recorded that year. Emirates ordered 42 Boeing 777s in a deal worth $9.7 billion, the largest Boeing 777 order in history at the Dubai Airshow in 2005. In April 2005, Dnata started operations in Saudi Arabia. In June, Dnata bought over Changi International Airport Services, with Temasek Holdings retaining shareholding. In July, Emirates flight catering began operations at its new food point facility – a 10,000 square metre facility capable of producing 30 million meals annually.
In early 2006, Emirates flight catering began operations at its new $120 million catering facility dedicated to service Emirates flights. The facility had the capacity of producing over 115,00 meals daily. Also, in 2006, Emirates flight catering opened its linecraft laundering plant. The facility has a total area of 10,500 m2, and a capacity to handle 50 tonnes of laundry and dry cleaning output per day. At the Farnborough Air Show in 2006, Emirates signed an agreement for 10 Boeing 747-8F in a deal worth $3.3 billion, and in 2007 Emirates signs contracts for 120 Airbus A350s, 11 Airbus A380s and 12 Boeing 777-300ERs, worth an estimated $34.9 billion, at the Dubai Air Show. The New Engineering Centre and Engine Test Cell are officially opened and the Emirates Harbour Hotel & Residence and the Marina Hotel open their doors. In September, the group also buys a 49% stake in UK based Alpha Group. Also in 2007, Dnata signed a 15-year joint venture agreement with China West Airport Group to provide airport ground handling services in Xi'an Xianyang International Airport. Dnata will also participate in operations at 10 other airports managed by CWAG. Under the agreement signed, Dnata will hold a 45 per cent stake in Xi'an Dnata Aviation Services Company Limited, with the remaining 55 per cent owned by CWAG. Also, at the end of 2007, Dnata opened offices in Qatar.
In 2008, the Emirates Group moved into its new headquarters in Dubai. Emirates SkyCargo also began operations out of Dubai Cargo Village's new Mega Terminal, with a capacity to handle 1.2 million tonnes annually. In June, Dnata acquired a 19.99 percent stake in its partner Hogg Robinson Group, becoming the largest shareholder in the company. In August Emirates took delivery of three A380s and the first Emirates A380 touched down in New York in August. Emirates also received its 10,000th cabin crew member. In September, Sabre Holdings signed a 10-year agreement with EmQuest to distribute services in Africa. In October the Emirates dedicated Terminal 3 opened with a capacity of over 27 million passengers, the terminal is the largest terminal in the world.
In 2013, EmQuest signed an agreement with Contac Services Inc. to launch the mywurld platform in the Middle East and Africa.