Turbulence Ahead

Etihad Continues to Struggle with European Airlines

  • Why it matters

    Why it matters

    Etihad has major stakes in European airlines including Air Berlin and Alitalia, but they are consistently unprofitable.

  • Facts

    Facts

    • A deal on restructuring German airline Air Berlin could be reached by Christmas.
    • Alitalia, another Etihad partner, is expected to make a loss of €400 million in 2016 and €500 million in 2017, according to Italian media.
    • Etihad CEO James Hogan is finding it increasingly difficult to justify his European investments to the Abu Dhabi government, according to sources.
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    Audio

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Etihad Chief Executive James Hogan. Source: Peter Boer

James Hogan, the chief executive of Etihad Aviation Group, hasn’t had a great year ­— at least as far as European operations concerned.

While the head of the national carrier of the United Arab Emirates has helped the company grow, investments in European airlines have proved costly, and analysts see Etihad going through turbulent times.

“Etihad’s investments in Europe so far haven’t helped to gain significant market share or to form an effective airline group,” said aviation industry analyst Gerald Wissel of Airborne Consulting. Recently, in fact, they have mainly been generating negative headlines.

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