While the coronavirus pandemic has brought international travel to a standstill, business travel is set for a major rebound, said Emirates Airlines President Tim Clark in an interview with CNN’s John Defterios, featured on CNN’s new series Think Big.
Excerpts from the interview:
John Defterios, CNN Business Emerging Markets Editor (JD): When does business travel get back to normal, or is it going to be defined as a new normal that's probably 25 or 30% less than you had prior to the pandemic?
Tim Clark, Emirates Airlines President (TC): No, I would say the converse. What has happened is that as a result of being locked down, as a result of having to engage in the networks that you see, whether it be Zoom, Teams or whatever. And I saw it in the mid '90s, when we digitized the global economy and all these tools came to market. The digital world ruled, the age of information came along, and everybody said you know what's going to happen? We're not really going to travel anymore. We won't want to do this. And actually, we can do much more of what we wanted to do over the... The converse happened. Between 1995 and 2015, 2018. The demand for business travel grew exponentially. As we get back to normal, as the economy is strengthened, as cash starts flowing back into the businesses that've been affected. You'll forget all of that, as they always do. We'll start see business travel, bounce back, and we'll see it grow. It will not slow down.
JD: You had a $5 billion swing from profitability to loss in the latest quarter. Can you get to profitability in the first half of 2022 as a carrier?
TC: I think we will start seeing a rapid return to cash positivity during the course of '21. Again, the back half. I would say that in the financial year '22, '23, that's when you will see the airline go back to profitability and generating the cash that it needs to meet the obligations that it has, and we can then continue our plans for fleet renewal, for network expansion, with some of the new aircraft, the tools that we need to start opening up new points. That will happen in '22, '23, '24. So, all right, I may be out by six months, but in the past, we've generally got it right when we take an assessment what's likely to happen. And in the end, you plan for that, you action your whole company resource on that plan and hope that it comes as good as I think it will.