I spend a lot of time on this place called the Internet. You’ve probably heard of it. I will admit that I dwell within the fringes and depths of it to find interesting aviation rumors and innuendo. Sometimes, however, they are so comical it just takes a look at Twitter to find some comedy gold. My friend Ben over at One Mile at a Time (you’ve heard of him)… well, he posted a summary of an article that he found on a paragon of virtue called Zerohedge saying that rumors were flying that Emirates sought a majority or, at least, a large stake in their rival down the track in Doha.
Now that you’ve stopped laughing the first time, let me just say that again. There are rumors that Emirates wants to purchase a large stake in Qatar Airways.
Let me put this in big bold letters so that I can give you a summary: EMIRATES WILL NEVER PURCHASE A LARGE STAKE IN QATAR AIRWAYS!!!!
Well, why not? I’m so glad you asked.
First off. Their goals differ. Emirates wants to be the world’s largest airline. An island unto themselves. Qatar wants to… well, they also want to do that. Except, they want to do it with seamless connections and some degree of alliance participation. At the end of the day, however, Qatar Airways exists for their homeland. They are an investment instrument that promotes Qatar while diversifying their economy. Selling out to Emirates dilutes the main aims of Qatar Airways. Making money is great and all, but when you’re backed by one of the world’s largest sovereign wealth funds, they are not going to want to share their return. Not unless it can somehow become significantly larger.
Splitting Emirates into Emirates (Dubai) and Emirates (Qatar) makes sense, in the fact that both places are ruled by an Emir. Semantically, such an assertion is not wrong. On top of that, Qatar was part of the negotiations to create what we know the UAE is today. The thing is that the very nature of a twin-hub operation across two nations brings me to my next point.
Neither party stands to gain anything. Think about it… while I have never actually visited the sprawling expanses of Dubai’s Terminal 3, I hear it is a machine. It works because it is efficient. Emirates is all about connections. Now, yes, so is Qatar Airways. Thing is, they both work as they have stand-alone hubs and, can you imagine how much more annoying it would be to have to fly between Doha and Dubai just to access separate destinations? That is not a value add — there is no synergy here. Passengers would go nuts and irregular operations handling would suffer. You cannot duplicate a mega-hub or add synergies to it by adding another hub. Mega hubs work because of their largess.
Fleet doesn’t matter. Both these airlines are so large they could absorb any oddball typing like an amoeba absorbing a plasmid. Thing is, again, that does not matter.
When you look at the huge quantities of money involved, yes Emirates would like more. Yes, Emirates is unaligned. On top of that, Emirates doesn’t even have partner airlines. Why? Easy. They don’t need them.
Emirates is Emirates. They are Highlander. Back in university, my professor discussed the “Judo” strategy of business. Emirates uses what he would later call the “Sumo-Judo” strategy. They need exactly no outside feed, help, or assistance.
So, to conclude.
This will never happen. I do, however, worry about the original author of the zerohedge piece. I hope he’s okay.