Emirates: President Sir Tim Clarke to retire, June 2020
Sheikh Ahmed bin Saeed Al Maktoum, Chairman of Emirates, via an internal memo announced the retirement of 70 year old Sir Tim Clarke as President of Emirates at the end of June.
Tim joined Emirates at its foundation in 1985, moving from Gulf Air in Bahrain. The launch of Emirates was part of a whole development strategy that has made Dubai what it is today.
Migrating to the sky its ancient purpose as a Centrepoint of sea and land-based trading routes, it became the hub for those travelling between the broader Middle East, Asia, the Americas and Europe.
Content of this Post:
A380 promoter
Although not the launch customer (which was Singapore Airlines), Emirates became the major backer of the A380 after its debut at the 2003 Paris Air Show. Emirates has purchased around 120 of the aircraft which is half of the total ever produced. Even the weight of Emirates orders has not been enough to keep the A380 on the production line, with manufacture set to end in 2021.
The A380 has been part of their highly successful two wide-body plane strategy, the other being Boeing’s 777. That will change soon, with Emirates signing a memorandum of understanding for Airbus’s A350 and Boeing’s 777X and 787-9s.
Unfair competition
Clarke has had to defend Emirates from criticism by international competitors who claim that the airline receives immense subsidies from the Dubai government.
However, it is undeniable that the airline has been nimble in adapting to changing conditions, whether it be the oil price collapse of 2014, the growing travel demands from regions like China and Africa, or the current reduced travel demand and the geopolitical turmoil in and around the Middle East.
Achievements
Tim Clarke moved to the middle east in 1975 and started with Emirates ten years later in 1985. Clarke has had a consistent vision for the airline, which he has been able to implement throughout his leadership. That alone is an amazing achievement.
His singular strategy was the A380. Here is him talking about what mistakes airlines like Lufthansa and Air France made (and by triangulation Qantas and Singapore etc) in not ordering enough A380’s:
“If you’ve got a sub fleet of 10 it’s a bloody nightmare and the costs go through the roof, she is absolutely right. But if you got a hundred of them it’s a bit different. Your unit costs in operating with that number are a lot lower than having just ten. Secondly, look at their interior. What did they actually do to shock and awe their market community with that A380 when it came to market? Why was it that it was Emirates, who took it after Singapore Airlines, that it lit up the planet in terms of showers and bars and big TV screens? We did it for a very well calculated reason. Not to blow our trumpet. But simply we had taken a huge risk and huge investment. To belittle that investment by putting in a Business Class seat of 1990s-think and a First Class of 1980s-think and Economy Class seating and IFE of 1990s-think was not something we would have done, like Air France.”
Sir Tim Clarke – AirlineRatings.com November 2019
He is still a believer in the aircraft, and I invite you to remember the following and see if he was right, as we move into the 2020s:
“Airbus will rue the day that they cancelled the A380. As we reset the global economy, which is happening now, demand will pick up again. But your problems will still be the same, your airports aren’t growing at the pace they need to grow with passenger increases of 4 per cent a year, 160 million extra people come to the industry every year. The A380 will come back into its own again on the massive trunk operations. But the difficulty is you only have 250-seaters to cope with demand. So what will happen is that the supply of seats will be reduced, prices will go up. In the middle of the next decade, airfares will rise significantly – as the A380 had 517 seats while the 777-9 has only 380 seats.”
Sir Tim Clarke – AirlineRatings.com November 2019 (my emphasis)
As my favourite airline, I want to believe Sir Tim Clarke’s observations on the A380.
Succession
Clarke will be hard to replace. The Financial Times suggests that the most likely inside candidates are: ‘Adel Al Redha, the government-owned airline’s chief operating officer, and Ghaith Al Ghaith, chief executive of Emirates’ sister low-cost carrier, Flydubai.’
2PAXfly Takeout
Tim Clarke will be remembered for more than the first-class showers, a communal bar in business class on Emirates A380’s, or the gold bling and faux wood of Emirates premium class cabins.
He pioneered the biggest airline in the world and did that as a British ex-pat in the Middle East. He ordered one of the most innovative aircraft ever produced and flew it successfully and profitably. He has maintained stable management at Emirates, which in the airline industry, is an achievement in itself.
What did you say?