Slowdown among Middle Eastern airlines?

Airbus and Boeing are vulnerable to a pause in expansion
After two decades of relentless growth, the ‘big three’ Middle Eastern carriers are seeing an uncharacteristic slowdown. This is something that should worry the ‘big two’ aircraft manufacturers, Aviation Week writes.
Emirates, Qatar Airways and Etihad Airways now fly around 575 aircraft, up from just 25 in 1996. More than a quarter of the widebody backlogs at Airbus and Boeing come from Middle Eastern orders.
Growth at the three carriers in revenue passenger miles (RPMs) was 11.2% in 2016 and is forecast at 9% this year, but their financial situation is more precarious.
Emirates’ profits fell 75% in the first half of 2016. Besides pricing pressures and exchange rate fluctuations, it’s facing a growing threat from low-cost long-haul airlines like Air Asia X, Norwegian and European flag carriers’ own new subsidiaries. Emirates is cutting costs.
The other two big ME airlines publish only limited financial results. Etihad says only that revenues were down in 2016 even though passenger numbers were up. Qatar merely says it’s not experiencing such intense financial pressures.
The US’s recent laptop and electronics ban is not helping. Meanwhile, the three airlines account for a large proportion of orders in Airbus’s and Boeing’s most exposed programs, the A380 and the 777-300. A pause in their expansion plans is an increasing possibility – something to watch out for at this year’s air shows.
Aviation Week


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