Etihad Airways has finally become profitable, disclosing $690 million in adjusted earnings and $296 million in operating profit during the first half of 2022 on operating revenue of $2.29 billion. The state-owned carrier did not disclose net profit.
Despite only limited information, it’s still clearly a huge swing for an airline that lost $2 billion in 2016, and $1.5 billion in 2017 pursuing a strategy of buying stakes in nearly every dumpster fire airline they could get their hands on (but still refusing to take a stake in South African Airways, which even for Etihad at the time was a step too far).
- They owned pieces of Alitalia, air berlin, Jet Airways and Virgin Australia which all failed. They also owned separate stakes in frequent flyer programs as a means of exerting control and taking additional stake without running afoul of foreign ownership restrictions. Somehow they believed that new uniforms and higher style would turn around the fortunes of basket case carriers.
- This had been a strategy of redirecting traffic from these airlines through Etihad’s Abu Dhabi hub, building up the capital of the United Arab Emirates into a global aviation powerhouse – a mere 72 miles from Dubai (and with less of a draw than that global hub).
- But they couldn’t overcome the underlying problems faced by these airlines and absorbed massive losses.
Etihad Airbus A380s Remain Grounded
Eventually the Al Nahyan family tired of absorbing these losses and gave up its global ambitions. They pushed out the CEO who architected the strategy and brought in former London Heathrow CEO Tony Douglas to cut costs. That also meant the end of Etihad as a super-premium carrier, nearly eliminating first class and dropping features such on board chefs.
Etihad Residence Butler
According to Cirium data in July 2019 Etihad operated,
- 7856 flights
- 2,002,464 seats
- 5,775,077,135 seat miles
Now, three years later that has fallen to:
- 4540 flights
- 1,188,787 seats
- 3,292,315,760 seat miles
Etihad is making money flying 41% fewer seats than they did prior to the pandemic.
For years passengers were subsidized by the global premium ambitions of Abu Dhabi, and now the airline is sadly a shell of its former self – that no longer flies to Dallas, San Francisco or Los Angeles (but that still maintains service to New York JFK, Washington Dulles, and Chicago O’Hare).
They remain an American AAdvantage partner, with miles redeemable for a still-good product when available, and whose miles can be used at largely American’s own pre-2016 devaluation prices for travel on American Airlines on those rare occasions when American offers saver award space on its flights.