The fast-growing Middle Eastern airlines continue to flex their fleet muscle, positioning themselves for a bigger slice of the global aviation market

Courtesy of Airbus

Having carved for themselves a hub operation in the Middle East, the trio of Gulf carriers – Emirates, Qatar Airways and Etihad Airways – has since turned the tables on the once-fabled Kangaroo Route, leaving in their wake Asia-Pacific airlines which were the dominant carriers on the Australia-Europe routes. And when they are done with offering travellers from Australia and Asia a one-stop service to just almost anywhere in Europe, these airlines began to offer similar one-stop services to destinations in Africa and North and South America.

Only the Pacific Ocean routes seem to have eluded the Middle Eastern carriers but with partnerships and mergers flying in every direction, this might just be realised, as in the recently forged Emirates-Qantas alliance. Meanwhile, other Middle Eastern carriers such as the once-multinational Gulf Air (now exclusively owned by Bahrain), Royal Jordanian Airlines and Oman Air have found it difficult to challenge the dominant trio.

In the last few years, however, a new challenger in the form of Turkish Airlines has emerged. Away from the limelight shone on the three Gulf carriers, Turkish Airlines quietly grew its footprint from 10.4 million passengers in 2002 to 38.5 million passengers in 2012. Revenue grew even faster from US$2 billion in 2002 to US$8.1 billion in 2012.

Leveraging on its Istanbul base as a bridge between Europe and Asia, Turkish Airlines’ strength, according to CEO Temel Kotil, lies in its ability to service Europe and much of Africa with narrowbodies, enabling greater frequencies and capacity-matching to achieve high load factors that triumph its Gulf rivals with their widebody jets. The airline will add Sydney to its network by 2014.

Apart from heavy investment in airport infrastructure by the governments in the UAE and Qatar, the Turkish government has outlined plans to build one of the world’s largest airports in Istanbul with an annual throughput of 150 million passengers. Construction is expected to take only four years and costs around US$8.7 billion.

In its financial year of 2012-2013, Emirates grew its fleet by 34 widebody aircraft and its profit by a spectacular 52 per cent, even as most international airlines are struggling with shrinking profits, load factors and yield.

By any measure, Emirates, Qatar Airways, Etihad Airways and Turkish Airlines have been spectacularly successful and have also proven to be highly competitive as they continue to sniff out interesting city-pairs that could be hubbed through their homebases. All four carriers have also undertaken extensive investments in marketing campaigns and sporting events sponsorship.

The three dominant Middle Eastern carriers have invested heavily in fleet expansion since their inception. In various instances, Emirates and Qatar Airways have been instrumental in pushing the manufacturers to boost the aircraft’s performance and capabilities, resulting in workhorses that perfectly suited their needs. But neither was it a zero-sum game as other airlines also benefitted immensely. Today, many of the world’s most heavily travelled air routes are served by twin-engine aircraft and the Boeing 747 – dubbed Queen of the Skies – which is beginning to retire in greater numbers.

In the past decade, Airbus and Boeing have centred much of their attention on the Middle Eastern carriers as Emirates, Qatar Airways and Etihad have inked record-smashing deals for top-of-the-line airliners year after year. And it is certain that the major Gulf carriers will continue to hog the limelight when orders are announced at major air shows, including the Paris Air Show next month.

B777-300ER: Boeing’s wonder machine
The Boeing 777-300ER – Boeing’s answer to the Airbus A340-600 – appears to be a front runner in the fleet of the Middle Eastern airlines, but not necessarily bearing the honour of being the carriers’ flagship aircraft. One of the most economical and versatile twin-engine aircraft to operate profitably on both longhaul and medium-haul routes, the B777-300ERs are used by the Middle Eastern carriers on nonstop services to destinations as far-flung as Australia, New Zealand and Brazil, and also on relatively shorter routes to the Indian subcontinent.

Equally versatile is the aircraft’s seating configuration. Emirates’ B777-300ERs have four variants ranging between the high-density, 442-seat configuration and the low-density, 360-seat configuration, and the airline has opted for the high-density configuration by putting 10 seats in each row in the economy class, while many carriers opt for just nine seats in each row. The B777-300ER comes in two variants for Etihad (330 and 440 seats) and Qatar Airways (335 and 380 seats), while Turkish Airlines has also ordered a fleet of B777-300ERs configured with 340 seats in three classes.

Even as the B777-300ER continues to gain big orders worldwide, Boeing is reported to be offering the B777X in two variants with improved performance. Qatar Airways is expected to order up to 50 of this variant, and Emirates too has confirmed that it is looking at “a healthy number” of these, noting that by the time the B777X is available, it will have 175 B777ERs to replace. The number ordered will depend on the replacement cycle, the Airbus A350-1000s as well as the availability of more Airbus A380s. The B777-9X, one of the two B777Xs that Boeing is reportedly offering, is nicely slotted between the A350-1000 and the A380 in capacity.

A380: a new queen in the making
Airbus envisaged the A380 as the high-capacity workhorse suited to operate between the world’s major hubs, particularly in highly slot-constrained airports such as London-Heathrow and Tokyo-Narita. Singapore Airlines was the first to operate the A380 in October 2007, and with glowing media reports and passenger reviews highlighting the A380s’ stability and ultra-quiet cabins soon after, the A380 quickly became a household name among the travelling public.

Early A380 operators reported higher demand for the superjumbo flights over other aircraft types on the same routes. Many travellers also began to differentiate airlines as those who “have” or “have not” gotten A380s in their fleet.

For those who are already operating the A380 or awaiting delivery of theirs, the superjumbo is the company’s flagship aircraft. Emirates deploys its A380s mostly on longhaul destinations such as Sydney, Singapore, Bangkok, Hong Kong, Kuala Lumpur, London, Los Angeles and Johannesburg and also on shorter services to key European destinations and Saudi Arabia. Emirates, however, has been prevented from operating the A380 into markets such as India and most recently Austria. The cavernous two-deck interior has given airlines tremendous flexibility in customising their premium class cabins. Emirates remains the only airline in the world to install showers and shisha rooms on board its A380s – exclusively for its first class passengers.

Both Qatar Airways and Etihad have 10 A380s on order but have not divulged their configuration plans and cabin facilities. Airbus has just begun production of Qatar Airways’ first A380. Turkish Airlines has also expressed interest in acquiring large-capacity aircraft in the same class as the A380 and Boeing 747-8 Intercontinental but no decision has been announced yet.

Boeing 787 Dreamliner: a nightmarish start
Designed as a replacement for the Boeing 767s and Airbus A310s, the Boeing 787 Dreamliner is a medium-capacity aircraft with the ability to operate on longhaul routes. Boeing had strongly marketed the B787 as an aircraft that could bypass major hubs – Japan Airlines (JAL) has utilised this aircraft in this respect to open up new routes such as Tokyo to Boston and San Jose.

The Dreamliner – already seriously delayed by the time of its first delivery to All Nippon Airways (ANA) – failed to live up to its promise and turned out to be a nightmare for the first batch of recipient airlines (Qatar Airways, ANA, JAL, United Airlines, LAN Airlines and LOT Polish Airlines). Two separate fires in the ion-lithium battery compartment resulted in the worldwide grounding of all B787s in January 2013.

The four-month grounding was lifted after a fix was finally approved in May 2013 and airlines were quick to return their Dreamliners into the sky. Qatar Airways resumed services of the B787-8s on May 20 to serve Dubai, London-Heathrow, Munich and Frankfurt. The B787 is expected to be deployed on its trans-Atlantic routes in 2014.
As more airlines take delivery of their B787s in the next couple of years and barring any further groundings, passengers may forget the initial hiccups and instead focus on the aircraft’s large electro-chromic windows, higher cabin humidity and pressure – factors that mitigate the effects of jetlag – and roomier and quieter cabin. Besides the strong passenger appeal, airlines will also benefit from the B787s’ highly fuel-efficient engines and maintenance savings resulting from the aircraft’s composite structure.
Boeing offers two variants of the Dreamliner: the B787-8 and the higher-capacity B787-9. Although only two of the four carriers reviewed have ordered this aircraft, it is expected that further orders will materialise, especially if Boeing rolls out a higher-capacity and longer-range model that various Middle Eastern carriers have sought.

A350: Airbus’ next venture
A strong competitor to both the B777-300ER and B787 Dreamliner, the Airbus A350 is highly suited for medium- and thin longhaul routes where demand is insufficient to support the use of the B747-8 Intercontinentals and A380s.

At press time, the first A350 painted with the Airbus’ corporate livery has just been unveiled in Toulouse, and will be put through exhaustive tests before starting its maiden flight this summer. A total of three variants have been planned: the A350-900 will be the first to be introduced, followed by the shorter A350-800. The longest, A350-1000, together with the -900 variant, find greater favour among the Gulf carriers. While Turkish Airlines has committed to a renewal of its narrowbody fleet, it has yet to announce its choice of future widebody aircraft and the race is on for Airbus to push for its A350s to be chosen.

Interestingly, Qatar Airways and Etihad have opted to order both the B787 and A350, carefully choosing the variants in both types to minimise capacity and performance overlaps. Given that recent new aircraft types such as the A380 and B787 have faced lengthy delays and performance hiccups, it is perhaps an insurance on the carriers’ part against the non-performance of either the B787 or A350. The A350s will be deployed mainly on longhaul routes to Asia-Pacific, capital and secondary cities in Europe, Africa and other cities in the Middle East where demand is high.

A340: the workhorse of yesteryear
When the competition heated up between the four-engine A340 and the twin-engine B777, Airbus and carriers such as Virgin Atlantic Airways were quick to claim that four engines were more reliable than two. Virgin Atlantic even painted the slogan “4 Engines for Longhaul” on its A340 fleet.

The A340 was produced in four variants – the A340-200, the slightly bigger A340-300, the even larger A340-500 and the longest-range A340-600. None of the Middle Eastern carriers ordered the -200 variant and only Emirates and Turkish Airlines operated the -300 variant. The A340-500 is considered a niche aircraft due to its ultra-long range capability and, as such, were often deployed on services to faraway destinations in North and South America and Australia. Where demand is high on these routes, the A340-600s’ high capacity was put to good use.

While the A340s were considered very quiet and well-suited for longhaul routes by virtue of having four engines, the General Electric GE90 engines that power the B777-300ERs were gaining a reputation for reliability and fuel economy – the latter especially attractive to airline bean counters amid skyrocketing fuel prices. Engine maintenance is a significant cost component and with four engines to maintain, the A340s quickly found the numbers stacked against it. As the A340-600s competed directly against the B777-300ERs, it was no surprise that both Emirates and Qatar Airways utilised every available avenue to cancel all and part of their orders respectively.

All these notwithstanding, the various variants of the A340s were extremely popular with passengers though, most notably for the low cabin ambient noise. Emirates’ small fleet of A340-300s are mostly deployed to European destinations such as St Petersburg, Munich, Milan, Dusseldorf and Glasgow, while Turkish Airlines continues to operate its A340-300s to Asia-Pacific, Europe and North America.

Qatar Airways’ A340-600s are operated to European cities such as Frankfurt, Paris, London and Zurich as well as to farther destinations such as Hong Kong. Etihad’s A340-600s too service many European cities but are also despatched to longhaul destinations such as New York, Sydney and Melbourne.
Ultimately, economics triumphed all else and the A340s were maintained on the current fleet of the Gulf carriers in limited numbers. Production of the A340 was halted as orders evaporated.

This article was first published in TTG Asia, May 31 – June 6, 2013 issue, on page 10. To read more, please view our digital edition or click here to subscribe.

The way to a Singaporean’s heart is through his stomach. Raini Hamdi looks at Singapore as a source of and a destination for gourmands, both factors feeding on each other and fuelling growth

Artisanal and mouth-watering: Matt Moran and Jean-Francois Piege’s (top right) masterpieces

When a survey reveals Singapore has overtaken Japan as having the region’s top diners, Singaporeans are probably the least surprised, since their obsession with food is as endemic and conspicuous as the smell of cheese.

MasterCard’s latest survey of the dining-out habits of 7,678 respondents from 16 markets in Asia-Pacific shows that Singaporeans are prepared to fork out twice as much (US$262) as the overall average monthly dining spend of US$130 for the whole Asia-Pacific. Japanese and Chinese follow closely with an average monthly dining spend of U$225 and US$203 respectively. In contrast, the region’s smallest spenders – India and Indonesia – spend US$17 and US$19, or three and four per cent of their monthly household income, respectively, on dining.

According to the survey, Singaporeans’ spending on dining grew by nearly 25 per cent from US$212 in June 2011.

The findings came just as the curtains came down on the 17th World Gourmet Summit in Singapore where, for 11 days, the city’s F&B scene burst like a ripe apricot with 45 special dinners and workshops in 13 host venues, 18 partner restaurants and eight wineries.

Top chefs, including Italy’s Gabriele Ferron (famed for his risotto), France’s “slow food” Jean-Francois Piege and Spain’s chocolate and sugar-pulling artisans Paco & Jacob Torreblanca, partnered the head chefs of their host venues in presenting menus that showed their artisanal skills.

An Italian hands-on culinary workshop featuring masterchefs Corrado Assenza  and Lino Sauro was priced S$148+ (US$119), while a Chateau de Beaucastel wine dinner featuring Chef Jean-Francois and Christopher Millar at Stellar at 1-Altitude was sold out, even at S$448+. Food was paired with fashion (an edible catwalk showcasing diamonds had models wearing chocolate dresses), and with arts (a meet-the-cast of Othello with cocktails prepared by five restaurants).

Events such as this put Singapore on the world culinary map, while Singaporeans’ willingness to spend on dining ensures a steady stream of new F&B establishments in the city, said Olivier Bendel, CEO and owner of Déliciae Hospitality Management.

The F&B scene is so sizzling that entrepreneurs such as Paris-born  Bendel and top-gun chefs like Bruno Menard – the only three Michelin star chef in Singapore – now call the city home.

Said Bendel: “I’ve opened nine restaurants here in 2.5 years. We’ll open our second L’Entrecôte in the new Suntec Singapore (which is undergoing modernisation) in September and probably one or two more restaurants by the end of this year or beginning 2014. Then we’ll explore opening in the rest of South-east Asia.

“Singapore customers know their food and always want to discover new things, which is good as it keeps us on our toes. They go for both affordable and ultra-fine food.”

Which is why Bendel’s restaurants range from fine-dining such as Forlino, to the funkier and affordable &Made by Bruno Menard, which sells handmade burgers. The majority of customers are Singaporeans, said Bendel. “I’m proud of that, as Singapore is my home now and I want to bring something to the community. I actually did not come here to open restaurants.”

2am:dessertbar’s owner and founder Janice Wong agreed that Singaporeans always want something new. She said: “The challenge is sustain interest and create new consumer experiences.”

Her latest experiment involves techniques with skins and seeds. “Mangosteen, melon and cantaloupe seeds are full of antioxidants and proteins. We’re turning edible stuff that are commonly thrown away into tasty sauces or for inclusions in breads and salads. So eating becomes meaningful and a social education as well,” she said.

Matt Moran, known for his successful Aria restaurant in Sydney aside from being a judge onMasterChef Australia (Season 3), said Singapore’s culinary scene kept getting better each year in the past 11 years he had been visiting. “You can tell by how many chefs are coming here from around the world, by how many great restaurants there are here – Singapore has become a food mecca,” he said. His favourite restaurant in Singapore is André, which he thinks is “top 10 in the world at the moment”. Asked why he had not opened a restaurant here, Moran said: “May be one day.”

India’s celebrity chef and restaurant owner Sanjeev Kapoor, judge of MasterChef India(Season 3), described such reality TV shows as “a theatre of food” – designed to entertain, not educate – and Singapore as “the biggest theatre we have in this part of the world”. But, like Moran, he too was non-committal about opening a restaurant in Singapore. “Let’s see,” said Kapoor.

The fact is, while F&B has become big and Singaporeans are appreciating more good food, operating a restaurant in the city is a challenge even to the best of them. Menard said: “I thought I knew Singapore quite well, as I had been coming here (before moving to Singapore) most of the time. I’ve been here for over a year now and the experience has been challenging, to be honest.

“The biggest frustration is finding people to work in this business and I would not be the only to tell you that. We’re all struggling to find staff who want to spend their lives as a chef, waiter, maitre ’d or sommelier, which in Europe are real professions. It is also difficult to hire foreign talent.

“There’s also the challenge of getting fresh produce. We import of course but you can’t talk ‘fresh’ if you import. Fresh fish for me is fish caught overnight. Here, the freshest and nicest fish you get is five days old. Fortunately, the companies which import are trying to make it faster and better all the time.

“But it’s also exciting to live here, build up the F&B business and create something new from scratch. When I came here 15 years ago, there was nothing in terms of French or European food. Today this is well-represented and there are lots of outstanding restaurants.”

Thailand: Where’s the beef?

THAILAND’s chefs and restaurants continue to build on the kingdom’s reputation as a destination for food lovers, but the country boasts few marquee gourmet events.

Innovative venues continue to spring up across Bangkok, ranging from Water Library, which boasts the city’s most expensive tasting menu, to smaller dining houses such as Opposite, Paste and Supanniga Eating Room.

Two Bangkok restaurants, Nahm and Gaggan, made The World’s 50 Best Restaurants 2013 list. Another two venues, Eat Me Restaurant and Sra Bua by Kiin Kiin, joined them in Asia’s Top 50 Restaurants 2013.

Despite the groundswell of culinary creativity and local restaurants winning international plaudits, Thailand still has few major events or festivals that put it on the global gourmet map.

Last year, the Tourism Authority of Thailand (TAT) and Visa International teamed up to launch Thailand Splash and Spice in Bangkok, a three-month campaign targeting Visa cardholders and international and domestic tourists (see list). “There are about 127 restaurants in this programme,” said a TAT spokesperson. “The programme is open to all restaurants interested in participating. These include hotel restaurants, dining venues at malls and authentic, must-visit local restaurants.”

The campaign is promoted through the media but has no dedicated sales agencies.

Thomas Kinsperger, F&B manager, Mandarin Oriental, Bangkok, said Thailand Splash and Spice had not worked well for the hotel last year.

In general, Mandarin Oriental, like many high-end establishments, relies on its own activities and organises five or more events with Michelin-starred chefs each year.

“We always target chefs that cook a similar cuisine to what we do in a particular outlet (we host the event in),” Kinsperger said. “It is important to us that the chefs are all established and known worldwide and have not been to Bangkok previously.”

Despite bringing in some of the best chefs in the world, a majority of diners at these events are local Thais or expatriates, with only one in 10 bookings into the hotel for the experience.

Of the handful gourmet events Thailand has, the pinnacle is the Annual World Gourmet Festival hosted by Four Seasons Hotel Bangkok, a week-long extravaganza which has built its reputation over the past 13 years. But tour operators still tend to focus on Thai food as more of a cultural experience when putting together packages, rather than emphasising high-end cuisine.

“We’re not really influenced by food festivals or visiting chefs,” explained Michael Lynden-Bell, Thailand general manager, Exotissimo Travel.
A concerted effort from the public and private sectors is needed to promote the country as the foody destination in South-east Asia, said Kinsperger. “Both sectors should drive this, but particularly the TAT,” he added. – Greg Lowe

Key F&B events in Thailand
Thailand Splash and Spice, March 15 – May 31 This campaign by TAT and Visa International was launched last year. This year’s event went beyond Bangkok to include Chiang Mai, Pattaya and Phuket. Prices start at 749++ baht (US$25) for lunch and 1,499++ baht for dinner.

14th Annual World Gourmet Festival 2013, September 2-8 Hosted by Four Seasons Hotel Bangkok, this event has grown over the years into Bangkok’s premier culinary event. Last year, eight top chefs from around the world were flown in with each showcasing their cuisine for two nights.

Samui Fine Dining Festival Now in its second year, this biannual two-month long event focuses on Thai and international chefs based on the island rather than flying in culinary superstars for one-off events. Each night, 16 restaurants create special six-course menus priced from 1,800 baht to 4,900 baht per head. More than 2,500 menus were created in March and April during the event earlier this year. The next takes place in June.

This article was first published in TTG Asia, May 31 – June 6, 2013 issue, on page 14. To read more, please view our digital edition or click here to subscribe.