Monday May 5, 2008

Etihad seeks bigger market share in MALAYsia

THE CEO INTERVIEW
By B.K. SIDHU

VALUE for money is what Etihad Airways claims it is offering.

With reasonably priced airfares to comfortable seats, advanced in-flight entertainment systems to sumptuous meals, this four-year-old Middle Eastern carrier is hoping to tap a bigger market share locally.

It currently enjoys an average load factor of 78% on its Kuala Lumpur-Abu Dhabi route and its country manager, W. Lindsay White, wants to improve on that.

He wants to create greater awareness of Etihad’s branding in Malaysia. He wants to tell the story that the airline takes pride in its service quality and innovation and the aircraft features are superior to those of some other airlines.

Etihad Airways Diamond first class cabin offes seats that can rotate 180 degrees.

Its economy class seat pitch is 33 inches, much larger than that of most airlines, and its LCD screen is also larger at 10.4 inches.

“The seats are not just comfortable but they offer lumbar support. Those in the first-class and business cabins can be turned into flat beds and they also come with a built-in massage facility,’’ he told StarBiz.

The airline has its own branding for its three seat classes. It calls its first class Diamond, business Pearl and economy Coral. But can it win the hearts of so many Malaysian travellers who are used to household names such as Malaysia Airlines and AirAsia?

W. Lindsay White

“Our biggest challenge operating in Malaysia is that we are not a household name and that is why we want to work towards building a profile here,” he said.

“We want to create brand awareness and communicate to businesses and leisure travellers that we truly offer value for money. We want people to know that we are an airline that treats passengers as guests.’’

An added feature of its Diamond class seats is that they can rotate 180 degrees to allow a passenger in the front to swivel the seat to face the passenger at the back for a meal or just a chat in the air. The airline also offers chauffeur services in some markets.

Lindsay claimed that Etihad offered reasonable fares. He quoted the airline’s fare for a return economy flight from Kuala Lumpur to London with a two to three-hour stop in Abu Dhabi to be RM3,485 inclusive of taxes and fuel surcharges.

“We thrive on product innovation and quality of service standards. We are on a continuous drive to innovate and improve our product offering, and we do listen to our passengers,’’ he said.

The airline began plying the KL-Abu Dhabi route in January 2007. For the first three months of this year, the airline has seen load factors averaging 78%. For the same period, the Pearl class recorded an average load factor of 94% and Coral 76%.

Etihad, which recently won the Best Airline Website award at the Pan Arab Web Awards, has since its inception four years ago expanded a lot faster than most carriers of its size.

Now this Abu Dhabi-based airline flies to 46 destinations using 37 aircraft. By year-end, it would have 40 aircraft. It is also the national carrier for the United Arab Emirates.

Etihad Airways virtually flat bed in its Pearl Business Class

For the first three months of this year, the airline carried 1.4 million passengers, recording an overall passenger load factor of 75%, and it hopes to end the year with six million passengers.

The airline is ready to go for e-ticketing well ahead of the June 1 deadline set by the International Air Travel Association for paper tickets to be scrapped.

Etihad has plans to expand its network and fly to more destinations in India, Moscow, and Almaty in Kazakhstan. It will increase its flight frequency to Sydney to 11 weekly flights by year-end.

Despite the eagerness to expand its network, White did say that the higher crude oil prices would have an impact on the airline’s expansion programme, and that “it (the programme) would be evaluated before it is executed.’’

“I would like to believe that fuel prices will come down and stabilise but that would be wishful thinking,’’ he said to a question on the direction of jet fuel prices.

White was candid when he said that the airline would have to pass the higher cost of fuel to passengers in the form of higher fuel surcharges. That has become a norm for all airlines.

But by no means is the airline going to scale down or cut the KL-Abu Dhabi route, as its load factors are pretty decent.

However, White said the airline would not increase its six weekly flights for the KL-Abu Dhabi route and it would not consider flying to any other destination in Malaysia.

For now, the focus is on the coming summer months, which are going to be a busy period for this airline.

It is getting ready to fly hundreds of Middle Eastern travellers to Malaysia. It would even use a bigger aircraft to increase the passenger load by 30% in these months.

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