Yesterday in part one of my discussion with Qatar Airways Senior VP of the America Tony Hughes, we were just getting warmed up. Today in part two, we get right into the meaty issues of codesharing and competition.
Cranky: Middle Eastern carriers tend to avoid traditional alliances, what is your stand on alliances? Codesharing?
Tony: Two things really. Codeshare: whatever makes business sense to us, we will work with. We have a strong relationship with United in the USA. We codeshare on New York and Washington. We codeshare with US Airways out of Houston but those are one-to-one business relationships. The alliance strategy, I can’t really comment on, because that’s our CEO’s prerogative.
Cranky: Are you pretty happy with the feed you’re getting in the US from United and US Airways? Are you looking for more?
Tony: The day we go out with full flights every day of the year, we’ll be happy with the feed. One of the issues we have in the US is the Fly America Act [where US government travelers have to buy tickets on US-based airlines]. In Washington in particular, we carry a lot of government and military business. So the United codeshare does mean those passengers can travel on us with a United ticket. So that’s good. And the passengers are pretty pleased they can do that.
Cranky: Washington is obviously a lot of government. New York is a lot of everything.
Tony: Yeah, it’s New York. We get a lot of business. We also carry a lot of ethnic traffic. About 80% of all our business connects beyond to somewhere else.
Tony: Yeah, the big premise of Doha is as a hub and spoke, so that’s what we do. We have this very famous premium terminal for Business and First. It’s like being in a five star hotel. That’s what we’re geared up to do.
Cranky: Another thing that may surprise people is the Houston connection. Qatar has a lot of natural gas, right?
Tony: Yes, second largest supply in the world.
Cranky: Is that primarily what the Houston flight is doing?
Tony: That was the key premise. Very much so. We carry a lot of business for the main oil companies and affiliated industries. But again, we carry traffic from the West Coast, even from Canada, and again we have some ethnic business. We have a lot of medical tourism becase of the big medical center in Houston.
Cranky: Let me go back to Emirates and Etihad for a second. Emirates is in Houston, New York. Eighty percent of your traffic is connecting so you’re not necessarily selling on the nonstop flight. If you could explain how you compete with them – what’s your selling point?
Tony: Like any business, there’s no blue ocean space around anymore. For us, our biggest competitors are not just Etihad and Emirates. We compete with Lufthansa, British Airways, Air France, KLM , who have pretty extensive networks. The value proposition we have is that for one, we offer excellent serice. All our flights from the States are ultra long haul. Our shortest flight to the States is 12 1/2 hours. So obviously we are very good at that.
We have to offer the customer more space. If you take the 777s, all airlines in economy have 3-4-3 configuration and we have 3-3-3, so we have a whole row of seats not there so that makes a difference. Our business class space is huge. So all the ingredients for long haul flying have to be there. That’s a big hook. The other thing is depending on where you’re going, you can do a one stop service with us that might require 2 stops on another carrier.
Thirdly, the terminal proposition. I’m a Brit with good ole’ Heathrow and everything. But Frankfurt and Heathrow in particular can be tough for transfers. Doha is quick. It’ll be better with the new airport which will open in about 18 months.
Cranky: Wait, in Doha there’s a new airport?
Tony: Yeah, there will be. It’ll be the most modern airport in the world.
Cranky: Is it just a new terminal or a greenfield site? I suppose it wouldn’t be greenfield but maybe brownfield.
Tony: No, it’s a brand new airport built on reclaimed land about 4km from the current airport.
Cranky: I’ll have to get more info on that.
And that I will, once I have time. The new airport looks to be absolutely massive and only a couple miles from the current one. Thanks to Tony for taking the time to chat.