Business
In recent years, the Persian Gulf has had some very strong rivals emerge in the airline business. One them being the government owned Emirates based in Dubai, UAE. They started off with only two aircrafts and has now built an empire of 240 aircrafts in their fleet. In addition, they have arrangements to purchase 50- A380’s and 174- B777 totaling up to billions of dollars. (Kamel, 2017). Emirates has become one the biggest and most powerful international carriers in the sky. This airline is run by Sheikh Ahmed bin Saeed Al Maktoum who is the uncle of Dubai’s absolute monarch. Maktoum is also in charge of the airport authority, the aviation regulator and also the city’s largest bank (Kamel, 2017).
Recently, Emirates reported an annual revenue decline which unfortunately has led to cutting of growth in specific regions of the world. Consumers are not buying that premium ticket price as much as they use to in years past (Doganis, 2006). In addition, there has been much discussion in regards to Emirates expansion in the U.S as there is tension with the Big Three (Delta, American, Untied). These three companies have started a lobbying campaign against the major Gulf rivals which are all government owned (Etihad Airways and Qatar Airways) also known as the ME3 (Evans,2001). The U.S carriers have started this campaign to restrict the access into American airports against the ME3. The U.S carriers claim they are no longer just competing with other airlines in the business, but rather directly with governments of the respective countries. This has become a problem due to the fact that the ME3 is gaining a lot of market share in the industry. In addition, Emirates state that they have not received any form of subsides after they started in 1985.
The challenge that arises here is the pursuit of the American carriers to have an Open Skies agreement to operate unlimited flights between the U.S and the Persian Gulf. These airlines argue that the ME3 has received $42 million in both direct and indirect subsidies since 2004. It seems like our American airlines are pushing hard to save the U.S economy as much as possible. The emirates airlines and airport work 24 hours thus improving the economy (O’Connell, 2011). President Donald Trump can initiate the working of American airports all day to improve profits and earning from local airlines.
Emirates airline has the largest fleet and has dominated the travel industry in the U.S which the biggest in the world. The Expansion of Emirate in The U.S means that the big three airlines will suffer in terms of revenue and jobs because of the ME3 leading to decline in the economy and loss of jobs for the people (Kamel, 2017). President Donald Trump seeks to start and ensure the campaign and stop the dominance of the Emirates airlines in The U.S. With this the American airlines will dominate its large home market creating jobs and increasing revenues and returns. Also trump could revoke or deny the landing or connecting flights for the Emirates airlines in the Major airports thus ensuring that the local carrier has an upper hand thus, generating more profits.
The Emirate airlines has been known for its luxury which many of the Americans enjoy such as open bar and airborne showers. This features has attracted many Americans to travel by Emirates airlines instead of the local carrier which does not offer luxury services (O’Connell, 2006). The local carriers do not offer this luxury forms because they are expensive. President trump can help support the economy of America by reducing the number of people using emirates airlines because of luxury by supporting the customization of American local carriers to align in the luxury aspect. The modifications account for the tons of water in the plane to be used by passengers. By doing this, most of the local people will start using the local luxury airlines thus taking back the market from the Emirates in increasing revenues.
Emirates airlines has non-stop travel routes to many major cities across the world, this has made many people opt traveling by Emirates rather than the local ones that have many connections (Kamel, 2017). When the people use foreign airline, revenues go to the country of the airline thus the Americans support other countries financially and the local airlines face financial strain. President Donald Trump can make relations with other country leaders to support the local airlines have direct flight over long distances to different destinations. This will help the economy of America as many people will start using the local carriers for non-stop travel destinations.
References
Doganis, R. (2006). The airline business. Psychology Press.
Evans, N. (2001). Collaborative strategy: an analysis of the changing world of international airline alliances. Tourism management, 22(3).
Kamel, D,. (2017). Bloomberg Business Week: Is Emirates Airline Running Out of Sky?. Retrieved From: https://www.bloomberg.com/news/features/2017-01-05/is-emirates-airline-running-out-of-sky
O'Connell, J. F. (2006). The changing dynamics of the Arab Gulf based airlines and an investigation into the strategies that are making Emirates into a global challenger. World Review of Intermodal Transportation Research, 1(1).
O’Connell, J. F. (2011). The rise of the Arabian Gulf carriers: An insight into the business model of Emirates Airline. Journal of Air Transport Management, 17(6).
