Qatar Airways (QA) on Monday said it plans to increase the number of destinations it serves to 220 by 2022 from the current 164, effectively shutting up mutterings in some quarters that the national carrier is fumbling under a Saudi-led siege of Qatar.
"There is no slowing down for us and together with our freighter destinations, we are planning to have 250 destinations by 2022, QA Group Chief Executive Akbar al Baker told reporters at a press conference in Doha on Monday.
The unjust blockade, he said, would not deter the national carrier from expanding. It would launch new destinations to make up for the lost routes in the blockading countries, Baker added.
On the possibility of impose fuel surcharge if oil prices continue to rise, Baker said,"We have oil hedging but if the prices continue to rise and cross the hedging, we will impose a fuel surcharge."
He said other airlines have already started charging a fuel surcharge and if fuel prices breach the oil hedging, Qatari Airways too will impose a fuel surcharge. Baker, however, did not disclose the price at which the airline has oil hedging.
Qatar Airways is somewhat cushioned from high fuel prices in that it has a long-term agreement with Qatar Jet Fuel. Jet fuel accounts for a substantial part of an airline's budget ” from 40 percent and above.
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According to a recent report by the International Air Transport Association (IATA), this year airlines around the world will spend a combined $188 billion on fuel, up by 26.1 percent compared to the $149 billion spent on fuel for last year.
IATA in its report had stated that this year's projected fuel spend is expected to account for 24.2 percent of total average operating costs, compared to 21.4 percent of total costs in 2017.
"Jet fuel prices have continued to rise with oil prices and we base our forecast on an average price of $84/b this year, and $70/b for the Brent crude oil price," the association said, noting that the impact on the industry's fuel bill was dampened last year ” and to some extent this year ” by the impacts of fuel hedging in one or two regions.
On the disclosure of QA's financial report for this year, Baker said,"We will be very transparent in our disclosures and auditing is currently underway." He said the financial results would be made public in the most transparent manner.
For 2016-17 financial year ending March, Qatar Airways recorded a 22 percent jump in net profit of QR1.97 billion ($541million) and 10-percent increase in revenues to QR39.4 billion.
Baker said his company does not have the liberty of some other airlines to hide under the chapter 11 clause (bankruptcy) and start fresh all over again.
Chapter 11 is a form of bankruptcy that involves a reorganisation of a debtor's business affairs, debts and assets. Named after the US bankruptcy code 11, Chapter 11 is generally filed by corporations that require time to restructure their debts, and it gives the debtor a fresh start, subject to the debtor's fulfilment of its obligations under the plan of reorganisation.
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