Economy could take toll on luxury of Middle East airlines

Rosenthal, the textile executive, is a convert. He used to fly United or Lufthansa to Frankfurt before catching a connecting Emirates flight to Asia and the Middle East. But when Emirates introduced A380 service to Dubai from New York, he became loyal to flying the large jet.

"I get my own room with a minibar. It has a shower spa. A lounge," Rosenthal says. "I can arrive wherever I'm going without feeling like I was stuck on a plane for 15 hours."

But with Emirates now switching to 777s, Rosenthal says he may revert to connecting in Europe to avoid long flights.

A first-class round-trip ticket between Dubai and New York in April costs about $15,800 on Emirates, according to its website. An economy ticket is priced at about $1,100.

New fleets, industry awards

With their global ambition, the Gulf carriers have been aggressive purchasers of large and fuel-efficient planes from Boeing and Airbus. The new planes are crucial in their quest for loyalty of the most discriminating customers who hop between continents.

Boeing expects to deliver more than 1,500 new planes to the Middle East in the next 20 years, making it the fastest-growing market in the world. Etihad was the talk of the Farnborough International Airshow last year when it placed the single largest order in the show's history — a $22 billion order for 100 Airbus and Boeing aircraft, with purchase options for an additional 105 aircraft.

The Gulf carriers were also among the first customers for the much ballyhooed A380 jumbo jet. European and Asian airlines are starting to cancel orders. But the Gulf carriers, so far, have held steady.

Along with their fresh-from-the-factory planes, the Gulf carriers provide some of the most luxurious services in the industry, and have garnered notable industry awards. Qatar Airways is one of only six airlines in the world to win the 5-star designation by Skytrax, an aviation research consulting firm. Emirates and Etihad have 4 stars; most U.S. airlines have 3 stars.

All three offer free limousine service from the airport for first-class customers. First-class passengers on some Emirates aircraft get a private suite with a shutter door, a fully flat bed, a minibar and a 23-inch flat-screen TV. Etihad's in-flight entertainment system, which has won industry awards, has more than 600 hours of on-demand video and audio programming.

"It's enough to make you want to connect" in Dubai or Abu Dhabi, Teffaha says. "And that's actually the point."

Despite world-class amenities, the region's carriers may not be immune to the luxury backlash and belt-tightening among corporate customers who can no longer justify $15,000 first-class trips in the battered economy. In January, premium traffic worldwide fell 16.7%, according to the IATA. While the region hasn't been hit as hard, premium traffic between the Middle East and nearly all regions of the world also fell.

"If the front cabin drops off, then you're in a world of hurt," says aviation analyst Michael Boyd. "It depends on how far the global economy sinks. Us mortals behind the curtain don't pay the bills as much. Will those passenger flows from Australia, India and Europe continue?"

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