A lack of aircraft has cramped the ambitions of Qatar Airways over the past year, but it is accelerating once again with seven new routes in 2007.
A shortfall in capacity, following a failure to negotiate acceptable terms for aircraft orders with either Airbus or Boeing at the end of 2005, has put Qatar Airways back by 14-15 months in its business plan, says Akbar Al Baker, the carrier's chief executive.
The shortage was "why I didn't live up to my promise" of Qatar launching routes to 10 destinations this year, he says. In fact, the carrier only added a single route in 2006 - a daily connection between its Doha base and Hong Kong. However, Al Baker says the carrier will resume its steep growth trajectory next year with seven new routes across Africa, Asia, Europe and the USA.
Four new Airbus A340-600s are joining Qatar's fleet to enable it to expand while the first of 20 Boeing 777s will start being delivered from late 2007.
Despite this new capacity, by the end of next year Qatar will "still be seven destinations short of what we envisioned," says Al Baker. It currently serves 70 destinations from Doha.
However, 10 years after he relaunched the airline it is outperforming expectations. "We are 15-20 percentage points better than our own business plan," he says. This plan sees the airline breaking even by 2010 or 2011. "And then afterwards we make a hefty profit," he says.
With such a huge investment in its fleet, which will double in size in the next decade to 110 aircraft, plus the burden of millions of dollars in extra fuel costs, it is understandable that the carrier will take this long to enter profitability, says Al Baker. At the operating level the carrier is in fact not far from breaking even, while all the key performance indicators it measures are "within acceptable limits".
Al Baker says the carrier will receive the first of its two firm orders for Airbus A380s in late 2010 and early 2011, a slippage of about a year. The airline had already delayed service entry from 2007 to 2009 to coincide with the opening of the New Doha international airport.
Source: Airline Business
