Emirates bets on premium economy launch to hit demand sweet spot

EMIRATES said installing premium-economy seats across the bulk of its fleet will take 18 months to 2 years as the Gulf airline targets what it hopes will be a sweet spot in demand following the coronavirus crisis.

Tickets for the new berths, pitched between existing coach and business-class products, go on sale next month, after which Emirates will focus on retrofitting the cabins in more than 100 Airbus A380 and Boeing 777 wide-body planes, chairman Sheikh Ahmed Bin Saeed Al Maktoum said on Tuesday (May 10).

"We are so pleased to introduce the new category in premium economy," he told Bloomberg Television in an interview in Dubai, where Emirates is based.

Emirates is relatively late to the market with a premium economy offering that's long been popular at many other major carriers. It finally resolved before Covid-19 hit to add the new class, a decision that's looking fortuitous after the pandemic upended travel patterns, hurting demand for long-haul business trips but boosting premium-leisure bookings.

Al Maktoum said he's confident the carrier will need no further financial support from its government owner as demand rebounds from the pandemic, while saying he can't predict when vital Asian markets will reopen.

"Since the start of this financial year we are solid, we are in the green, we've built up the cash that we need for the company," he said. "The way the world is opening, that will continue." Emirates aims to return to full capacity by the end of this year and to break even over the period, he said.

While Emirates is benefiting from continued flights to Russia after sanctions imposed after the Ukraine invasion forced other airlines to halt services, the operations represent a "fraction" of the wider business, the chairman said.

"Dubai is doing the right thing," he said. "If things are under sanctions then they will apply it, if they are not under sanctions they will not." BLOOMBERG