Qatar Airways Chief Executive Officer Akbar Al Baker says stability and a clear vision are the bedrock of success.
What are the factors that have led to your rapid growth?
There are many reasons for the growth to date, but it is particularly important to note that we have enjoyed a stable and supportive political and economic environment in the country. That has been vital to our success because it has allowed us to maintain a clear direction. And that direction is built around efficiency. It has been a driver from day one. We understand what we need to achieve.
And we have achieved a lot so far. Qatar Airways is one of the fastest growing airlines in the world. We serve nearly 140 destinations with a fleet of 130 aircraft. And we have won numerous awards, including Best Airline of the Year from Skytrax and Business Airline of the Year at the UK Business Travel Awards.
New destinations are being added all the time, as are new aircraft. We have just begun services to Larnaca and Philadelphia, for example, and we will soon be adding Miami and Dallas/Fort Worth.
And our first A380s will arrive any day, making what is already one of the youngest fleets in the world even younger. In total, we have 300 aircraft on order worth $50 billion on book prices. There are 80 A350s to come, as well as Boeing 777s and 787s. We were the launch customer of the Boeing 787 in the Middle East and we will be the global launch customer for the Airbus A350 later this year.
What are the challenges to your continued growth?
The main challenge for us is the same for every airline and that’s the fuel price. It is the single biggest expenditure for any airline. And this is why a stable environment has been so important to our growth.
Globally, there has not been the same stability. There is political and economic uncertainty and that creates a stress on the oil price and a stress on our industry.
What about the airspace issue? Can this be resolved?
Air traffic in the Gulf is growing rapidly and all that traffic is being channelled into a small number of corridors. If the efficiencies brought about by new aircraft are not to be impeded we must find a solution for this huge challenge in air traffic management.
The problem we have is not just limited to the Gulf, but is seen all over the world and that is the abundance of military airspace. So much usable airspace is taken up by the military.
All these no-fly zones make routes inefficient. Flights become longer, they emit more CO2 and so they cost more than they should—from an airline and customer point of view. All of this eats into the very small margins of profit that we have in the airline industry.
I would like to see something similar to Eurocontrol being set up in the Gulf—although we certainly do not want to emulate the challenges faced by Europe over the implementation of a single sky. But a single management system for the Gulf makes perfect sense. The countries are located close together and our airspace overlaps. This wouldn’t affect sovereignty, but would simply allow us to cooperate to improve efficiency and mitigate the pressure we are feeling from fuel prices and environmental concern.
The new Hamad International Airport is now open. What will this mean to the airline?
Hamad International Airport will make a huge difference. We have been constrained by our infrastructure. The existing airport was operating well beyond capacity—almost double capacity in fact—and moving to a new facility allows us to provide a product that is second to none. The passenger experience will be the best in the world.
The main reason behind this is that the airport has been designed with a thorough understanding of airline requirements. It has not been designed by architects who have been briefed on what would be good for an airline, but rather has been designed by an airline from the ground up. Qatar Airways has been instrumental in the design process. We have been very active in providing feedback and oversight.
So passengers get the best of both worlds. There are so many amenities to choose from—two hotels, a spa, squash courts, a swimming pool, and much, much more. And the retail experience will remind passengers of a shopping mall and not an airport duty-free.
At the same time, the airport has been optimized for efficiency, whether you are arriving, departing, or in transit. So the airport will function as an airport should. And the airline will function as an airline should. That is great news for the passenger.
It hasn’t been an easy process to get the airport open though?
Hamad International Airport had a soft opening at the end of April and was fully operational from the end of May. So I am glad that all the AGM delegates have had the opportunity to experience the new airport.
But we were let down badly in the beginning. The land on which the airport is built is reclaimed and we contracted with world-renowned companies for the design and management of the project. But they failed us.
What we were given was inefficient. There was a lack of standards, there were design faults, there were system integration issues, and there were substandard products that hadn’t been rectified by the project managers.
Everything had to be redesigned by Qatar Airways, but in the end I am very glad it was and we now have what I consider to be the best airport in the world.
Does being CEO of both airport and airline—as well as a number of subsidiary companies—make your life easier or more difficult?
It is not easy. But if I wanted an easy life I would not be in this job, but sitting beside a swimming pool with my feet up.
I would rather serve my country and give something back to the place that has contributed so much to my success. It gives me huge satisfaction to know that I have built a business and infrastructure that will stand the test of time and continue to serve the country for many years to come.
Why did you decide that the oneworld alliance was a good fit for your airline?
The alliance contains some of the best airlines in the world that follow the highest standards. We are also in that category so it makes sense for us to join forces. We achieved integration into the alliance in the shortest time of any carrier.
The alliance gives our customers immediate access to a far greater network without losing any of the convenience and service that they associate with Qatar Airways. Our customers can now choose from 900 destinations. They can easily book an interline journey, they can transfer without fuss, they can access more than 500 lounges, and they can collect frequent flyer points no matter which alliance airline they fly on.
For Qatar Airways, it is effectively instant growth. Think of the massive investment needed to grow to 900 destinations as an individual airline. I know exactly how much money, time, and effort is needed to grow an airline and doing it through an alliance is an obvious option. It is growth without the growing pains.
As we celebrate 100 years of commercial aviation, what achievements stand out for you?
When I look at the history of our industry, three things always spring to my mind.
First, connectivity has made the world smaller. We can now integrate our economies, share our cultures, and visit our family and friends far more easily. The world has become smaller and that is a positive development.
Second, that economic integration has been of enormous benefit. Aviation’s economic contribution to GDP is incredible. Worldwide, I believe it is now 2.4% of GDP. In Qatar, aviation contributes 11% of domestic GDP. Qatar Airways really is an integral part of the country. And airlines are an integral part of the global economy.
Third is the progress and development of safety. Those early flights were risky and many lessons about flight were learned the hard way. But now air transport is the safest mode of transportation and we are constantly improving our standards and our oversight. Qatar Airways was the first airline on the IATA Operational Safety Audit registry and we will continue to drive safety developments.
Finally, what would you like to say about Doha, host city of the 70th IATA AGM?
I don’t want to say too much because I just want our guests to experience it for themselves.
Let me just say that this is a country of great opportunity with great hospitality. You won’t have experienced anything like it before. Welcome!