By Rory Jones
DUBAI--Emirates Airline said that an ongoing spat with U.S.
carriers over government subsidies won't stop it from expanding in
North America, which has become the fastest-growing revenue region
for the Dubai-based carrier.
The airline's expansion in North America, which has accelerated
in recent years, has rubbed several U.S. carriers such as Delta Air
Lines Inc., American Airlines Group Inc. and United Continental
Holdings Inc. the wrong way. They accuse Emirates and its Persian
Gulf peers Etihad Airways and Qatar Airways of receiving state
handouts and have been lobbying the U.S. government to limit their
access to America.
Sheikh Ahmed bin Saeed Al Maktoum, the chairman and chief
executive at Emirates, said that the disagreement with U.S.
carriers would have no impact on Emirates' plans to launch new
routes to North America in what has become one of its most
lucrative markets.
Emirates, the world's biggest international airline by traffic,
grew the number of seats it flies to North America on a weekly
basis by 30% in the year to April, according to research firm
Innovata. It will also begin direct flights to Orlando in
September, marking the carrier's tenth destination in the U.S.
following the launch of flights to Boston and Chicago last
year.
The U.S. airlines "will not stop us from doing what we're
doing," Sheikh Ahmed told reporters on Thursday after announcing
the second highest full-year profit in Emirates' history. "We are
determined to do what others cannot do."
The U.S. has emerged in the past year as an important market for
Emirates, and at a crucial time too. The airline has suffered from
closed airspace in conflict-plagued countries around Dubai,
including Iraq, Syria, Libya Yemen and Ukraine, which has driven up
costs and closed off some markets.
The Ebola epidemic in Africa deterred many Asian customers from
flying last year. Dubai International airport also closed one of
its two runways in an 80-day upgrade over the summer last year,
grounding some Emirates planes and costing the airline $467 million
in potential revenue. Internally, Emirates has had to deal with
labor unrest among its pilots and cabin-crew staff.
Despite the difficulties, its full-year net profit rose 40% on
the year to $1.2 billion, helped by a sharp fall in fuel prices and
a 7% increase in revenue to $24.2 billion, its best financial year
since posting record results in fiscal 2011. Its financial year
runs from April to March.
Revenue from the Americas, which is mainly made up of U.S.
routes, grew by more than a fifth, a faster rate than any other
region. It now represents 11% of total revenue, a higher proportion
than the Indian subcontinent, Middle East and Africa regions, and
behind only Europe and the Far East and Australasia region in terms
of sales.
Emirates, which has grown passengers in double-digit percentages
almost every year in its 30-year history, said that it carried 49.3
million passengers in the latest fiscal year, an increase of 11%.
It carried more than 2.3 million passengers to and from the U.S.
last year and its aircraft, largely superjumbo Airbus Group NV jets
and Boeing Co. 777s, were on average 80% full.
Emirates Group, which includes a raft of other
businesses--hotels, a tour operator and airports operator--reported
a full-year net profit of $1.5 billion, up 34% on the year.
Write to Rory Jones at rory.jones@wsj.com
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