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29 March 2024

Etihad signs Dh15bn deal with GE

The all-economy service will operate to popular short-haul destinations with low demand for premium traffic. (EB FILE)

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By Staff

Etihad Airways finalised a $4.3 billion (Dh15.7 billion) combined deal at the Farnborough International Airshow on Tuesday, with GE.

The first was a $1.8 billion contract with the purchase of 78 GEnx-1B engines to power its 35 Boeing 787 Dreamliner aircraft order announced during the Paris Airshow in 2009.

The aircraft delivery is scheduled to begin in 2015.

The Abu Dhabi-based carrier also signed a 15-year OnPointSM solutions agreement with GE Aviation for the maintenance, repair and overhaul of these engines. The agreement is worth more than $2.5bn over the life of the contract.

Etihad Airways chief executive officer, James Hogan, said: “We are pleased to be working with GE for the delivery of these advanced GEnx engines, which offer cost optimisation and fuel efficiency for Etihad’s Dreamliner aircraft. One of the key criteria in the selection of our engines is environmental performance, and the reduced emissions of the GEnx engines will complement our fleet, which is one of the youngest and most environmentally efficient in the world.

“Furthermore, as part of our long-term partnership with GE, the OnPoint maintenance agreement will enable technology and skills transfer to our maintenance partner, Abu Dhabi Aircraft Technologies, for these engine types.”

The OnPoint solution is a customised service agreement tailored to the operational and financial needs of Etihad’s fleet.

In other news, the airline also announced double-digit growth in the first half of 2010, along with welcoming its first Airbus freighter aircraft and launching Seoul on its flightplan from December 12.

Despite a dismal first half for the majority of European carriers, courtesy the April vulcanic eruption and the resulting ash cloud from Iceland, Etihad witnessed a 11 per cent boost in passenger numbers compared to the same period last year, recording 3.3 million travellers.

Revenue passenger kilometres (RPKs) also saw a boost of 22.6 per cent over the same period last year, along with a rise in seat factors, from 71.5 per cent to 72.5 per cent.

There was also a 21.6 per cent increase in cargo tonnage carried during the quarter, with revenues up by 59 per cent.

Despite growth of 20.9 per cent in available seat kilometres (ASKs), the airline reduced its costs per available seat kilometre by four per cent in the six months ending June 30.

The airline will operate a total of 1,032 flights a week this summer, a 16 per cent rise on the 888 weekly flights that operated during the same season in 2009. 

The airline has reported strong forward bookings for the summer.

Farnborough also saw Etihad Crystal Cargo take delivery of the A330-200 freighter aircraft as the launch customer.

The airline has plans to increase its cargo business and build its presence in the high-growth European and Asian freight markets, in particular China.

“Etihad Crystal Cargo has been performing very well. Over the last quarter there was an 18 per cent increase in cargo tonnage carried, reflecting the strengthening recovery in our industry. We are focused on taking the right steps to achieve strong expansion and growth,” said Hogan.

“The new aircraft will become a key part of our freighter fleet and make a major contribution to building the strength and network of our cargo business. The additional capacity will help us significantly expand our footprint in Asia and Europe, including China, as well as enhancing our worldwide charter services.”

Etihad will take delivery of its second A330-200 freighter aircraft in September, which will enter service by October, taking the airline’s fleet number to 56 aircraft.
 
With its recent expansion drive to new gateway cities, the South Korean capital is to become the airline’s 65 destination from December 12, with a daily return service to Seoul.

Hogan explained: “South Korea is emerging as a key partner for the UAE, and the decision to commence services to Seoul reflects this strengthening partnership. Over the past two years, Korean business has been building a strong presence in the UAE, particularly in the clean energy sector, construction, technology and small to medium enterprises.

“We expect the increasing trade relations between the two countries will lead to growing numbers of business travellers, as well as people from both regions visiting friends and relatives.”

At present, there are over 5,000 Korean nationals living and working in the UAE, as well as a significant number of Korean businesses in operation.

Earlier this year, His Highness General Sheikh Mohammed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, visited Seoul to reinforce the strategic partnership between the two countries.

The visit followed the announcement in December 2009 that a South Korean consortium had won a landmark contract to build and operate four nuclear power reactors in the UAE, worth around $40 billion.

(With inputs from Bindu Suresh Rai)