The purpose of this report is to highlight the strategic challenges and issues of the Emirates Airline. Along with that the report will provide sustainable recommendations for the future. Emirates Airline is the global airline that serves around 155 destinations across the world. Its main hub is Dubai, UAE. Emirates airline operates the largest fleets of Boeing 777 and A380 Aircrafts. With two aircrafts in 1985, Emirates airline owns 265 aircrafts and serves 80 countries globally. Each week 1500 flights are operated across the Globe (Emirates , 2017). Emirates regional involvement is in Middle East and Africa, Western Europe, Asia Pacific, Eastern Europe and North America.

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Contents
Table of figures ................................................................................................................................. 2
Introduction and Company Background............................................................................................. 3
Emirates Airline Fleet service........................................................................................................ 3
Emirates Airline vision and mission statements.............................................................................. 3
Vision statement of Emirates Airline.......................................................................................... 3
Mission Statement ..................................................................................................................... 3
Emirates leadership ....................................................................................................................... 4
Emirates strategy and key stakeholders .......................................................................................... 5
Part 1- External analysis .................................................................................................................... 6
PESTEL Analysis.......................................................................................................................... 6
Porter’s five forces model.............................................................................................................. 8
Part 2-Internal analysis .................................................................................................................... 11
Value chain model....................................................................................................................... 11
Competency framework............................................................................................................... 13
VRIO Framework........................................................................................................................ 13
Part 3- Company’s corporate and business strategy.......................................................................... 15
Part 4- Identification of issues and challenges faced by the company ............................................... 16
Part 5- Identification and evaluation of the main strategic options for growth................................... 17
TOWS Matrix.............................................................................................................................. 17
Growth options using the ANSOFF Matrix.................................................................................. 18
SFA Framework .......................................................................................................................... 19
Recommendation and conclusion..................................................................................................... 19
Bibliography ................................................................................................................................... 20

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Table of figures
Table 1: Value chain table ............................................................................................................... 12
Table 2: Competency framework of Emirates Airline....................................................................... 13
Table 3: VRIO Framework.............................................................................................................. 14
Table 4: TOWS Matrix.................................................................................................................... 18
Table 5: SFA Framework ................................................................................................................ 19
Figure 1: Emirates Organisational Structure....................................................................................... 4
Figure 2: Break down of fares (The New York Times, 2011) ............................................................. 5
Figure 3: Porters five forces model .................................................................................................... 8
Figure 4: Porters Value chain model ................................................................................................ 11
Figure 5: Bowman’s strategy clock.................................................................................................. 15
Figure 6: Ansoff’s Matrix................................................................................................................ 18

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Introduction and Company Background
The purpose of this report is to highlight the strategic challenges and issues of the Emirates
Airline. Along with that the report will provide sustainable recommendations for the future.
Emirates Airline is the global airline that serves around 155 destinations across the world. Its
main hub is Dubai, UAE. Emirates airline operates the largest fleets of Boeing 777 and A380
Aircrafts. With two aircrafts in 1985, Emirates airline owns 265 aircrafts and serves 80
countries globally. Each week 1500 flights are operated across the Globe (Emirates , 2017).
Emirates regional involvement is in Middle East and Africa, Western Europe, Asia Pacific,
Eastern Europe and North America.
Emirates Airline Fleet service
Emirates offer First, Business and Economy class seats in their aircrafts. In the business class
travellers have flat-bed seats and luxurious shower spas. Emirates fleets are technologically
sound and capable. The fleet has three types of planes. Boeing 777-200LR has the capacity of
266 passengers and is technologically sound. Boeing 777-300ER’s is the back bone of the
Emirates fleet. This aircraft is clean and have peaceful ambiance. A-380 is the new kind of
aircraft that Emirates have added into their fleet that have wi-fi system, luxurious suites for
first and business class passengers (Emirates A-380, 2017). However in 2016, Emirates have
retired their A-330 Airbus aircrafts and A-340 planes and have added A-380 and Boeing 777
aircrafts to achieve a consolidated and efficient fleet (Euromonitor, 2017).
Emirates Airline vision and mission statements
Vision statement of Emirates Airline
“To be the leader in aviation innovation, environment protection as well as the best airline in
the world with a global network of coverage thanks to its strict compliance with flight safety,
responsibility, reliability, product and service quality and competitiveness
while making travel without borders to change the lives for the better” (Vision, Mission
Statement , 2015).
Mission Statement
 To grow as the most envied service worldwide
 To deliver the highest standards of product quality
 Improve the comfort for clients’ pleasure
 To remain a continued growth trends over industry

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 Invest in new technologies to satisfy customers
 Zero major accidents/crashes
 Remain the strategy of open sky discovering new frontiers for the customers
 Eco-efficiency, bio-fuel usage including all the up-to-date techniques for saving fuel
and emissions (Vision, Mission Statement , 2015).
Emirates leadership
Almost all of the Emirates executives have been there since the company have been found.
The bigger and better vision of the leadership is one of the reasons that can be attributed to
the success of Emirates.
His Highness Sheikh Ahmed bin Saeed Al Maktoum is the Chairman and Chief Executive of
Emirates Airline Group. Under his leadership the airline has grown remarkably from 2 to 260
aircrafts today. Sir Tim Clark is the President of Emirates Airline and he has played a pivotal
role in the transformation of the organisation.
Below is the organisational structure of the Emirate Airline:
Figure 1: Emirates Organisational Structure
CEO-Emirates Group
His Highness Sheikh Ahmed bin
Saeed Al Maktoum
President
Sir Tim Clarke
Chief Digital and
innovation
officer-
Christoph
Mueller
Executive Vice
president and
Chief
commercial
operations-
Thierry
Antinori
Vice president
of services
department-
Nigel Hopkins
Project
management-
Ali Mubarak
Ali Soori
Executive
Vice
President
and Chief
operating
officer
Adel Ahmed
Al Redha
Executive
Vice
Presidentof
Human
Resource
Abdul Aziz
Ali

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Emirates strategy and key stakeholders
Emirates key stake holders are its customers and they aim to satisfy their customers in the
best possible manner. They have differentiation strategy 1
through which they create value and
earn enormous revenues. As discussed above Emirates offer first, business and economy class
services to their passengers and through this they classification they diversify their service.
This figure below will show the breakdown of revenue from Dubai to New York Flight:
Figure 2: Break down of fares (The New York Times, 2011)
1
Differentiation strategy is all about creating the services and products with distinct attributes that can help to
gain competitive advantage.

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Part 1- External analysis
In this section PESTEL and Five forces analysis will be conducted to evaluate the main
opportunities and threats for Emirates Airline.
PESTEL Analysis
This analysis will consider all the external factors that influence the Emirates airlines
strategic objectives.
Political
Emirates Airline have faced massive issues due to the socio-political tensions in one of the
most important operating region, Europe where in 2016-2017 areas such as Brussels, Paris,
London, Nice, Turkey and Nice have faced massive terror attacks and this have shattered the
tourist confidence. Moreover with the exit of UK due to Brexit vote, it has led to closure of
many businesses in UK. The new government of Trump in USA have also brought changes in
the aviation policies related to security, entry requirements, and there have been restrictions
placed on the personal electronic devices in the cabins of the aircrafts. This all have affected
directly Emirates operations in USA. These political changes have affected the demand
pattern for air travel and this has affected the profitability too. However, stability was found
in the Asian, African and oceanic regions (Emirates Airline, 2017 ).
Economic
During the first quarter of the fiscal year 2016-2017 the airline reported decline in profit by
75 per cent because of the weak demand from the oil dependant countries as these countries
have faced lots of economic issues after the drop in international prices in 2015. Moreover
the strong US dollar has affected the major markets of Emirates like Africa and this have
eroded the major top line of the airline.
Social
The demand patterns for travel are changing rapidly. According to the Euro monitor report,
travel companies have been focusing on the particular aspect of the passenger’s journey. With
the rise in the mobile technologies there is form of personalised promotions, mobile check-ins
and bookings. The passengers have turned “smart” and this has helped the airlines to track

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the passenger trips in order to ensure safety and give them a good travel experience
(Euromonitor, 2017).
Technological
Emirates have three types of aircrafts, Boeing 777, Airbus A330 and Airbus A380. The
reason why Emirates have three types of flight is that this has allowed easy deploying pilots,
standardising the passengers experience and serving the long distance flights. Emirates also
maintain the youngest fleet in the aviation industry with 6.4 years on average. These efficient
planes are quite expensive which are not included in the industry’s bulk discounts. The price
of Boeing 777 is between $260 million and $315 million and A-380 at $390 million (Boeing ,
2013).
Environmental
For the environmental protection and security of the passengers as part of its mission
objectives, Emirates have been using the low-sulphur diesel as per the specification of the
government in 2014. The fuel has 10 parts per million (ppm) of sulphur and this has been
reduced from 500 ppm. It has reduced the emissions (Valerie Tan, 2016). The Airline also
uses Flex Track-system, which is an air routing system it takes the advantage of favourable
weather. This program has helped to reduce 3800 tons of fuel on flight to Australia. Around
12000 tons of carbon dioxide emission has been reduced over a period of one year (Greenair,
2013 ).
Legal
Legal restrictions to serve different destination is very integral to be considered.
Governments internationally have placed restriction on Emirates to serve the passengers to
reduce the competition from the national flights. China’s 1.3 billion people cannot be served
by Emirates until the Chinese government allows the airspace to be opened for Emirates. In
order to meet the international demand the regulatory approval needs to be taken (Juna
Alacer, John Clayton , 2014).

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Porter’s five forces model
Figure 3: Porters five forces model
Threat of new entry
The threat of new entry is quite low because to set up an airline it’s very expensive. Secondly
the competition is very tough among the airlines based in UAE and internationally that is
why for a small airline to enter the market it’s quite difficult.
Buyer power
The power of the passengers is not as high as the price is not the main concern. The firms are
price makers generally. Moreover with the changes in demand patterns due to socio political
changes the power of airline has been reduced and they are working more efficiently to serve
the passengers in the best possible manner. This can however be divided regionally and
internationally. Since Dubai is the major hub for emirates so the buyer’s power is low but
internationally due to many other airlines the power of buyers is high. Emirates offer the
longest non-stop flight to various routes globally so there the buyer power will be relatively
low.

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Threat of substitutes
Passengers look for budget and luxury when choosing the airlines so if customers are more
prices averse so there Emirates might lose business. However those passengers who look for
luxury there Emirates will be preferred. The perceived value of Emirates is quite high
because of the new technologically sound aircrafts, efficient crew and personalised services.
Power of suppliers
The supplier cost of switching is very low as there are only two aircraft manufacturers
Boeing and Airbus and there are many airlines so the supplier concentration to firm is very
low. Secondly, the employee is concerned so in UAE labour unions are not allowed therefore
the bargaining power of labour is not high. Emirates crew members are 75 per cent females.
The relative cost of labour for Emirates is low compared to other airlines because employees
are not given tax free incomes, free residential housing and health care plans. All the staffs
are based in Dubai which makes it easy to schedule the flights and operate internationally
(Emirates Airline, 2013).
Competitive rivalry
Emirates have used the strategic position of Dubai as the transit to connect to the long
distance flights. They have built their market share on key routes that were once dominated
by the European Airlines. There are 37 airlines that fly from Dubai. Regionally the
competition in terms of prices is there as the Etihad Airways compete on low prices and
Emirates offers luxury to the passengers. By expanding to the international destinations they
are diversifying and reducing their dependency in Middle East and Africa (MENA) only.
This section have analysed that external factors have been very much important for Emirates
and the socio political threats have led to changes in the demand patterns and so does the
profits. Moreover the opportunities are also there as with exploring more routes they are
diversifying and growing their operations and with the good brand image Emirates launch to
new routes is very successful.

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Opportunities Threats
 Growth and stability in Asian regions.  Socio political factors that have
affected the consumer demand for
travel.
 Preference given because of luxury
airline.
 Low cost airline competition
 Diversification of routes  Regulations from governments
internationally.

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Part 2-Internal analysis
This section will analyse the internal strengths and weaknesses through the value chain
model, competency framework and VRIO framework.
Value chain model
This model helps to analyse the factors through which Emirates Airline can create value to its
customers and ultimately achieve profitability.
Figure 4: Porters Value chain model
Activities Relating to Emirates Airline
Support activities
Firm
infrastructure
Emirates have not entered into alliance with the “star alliance”, “one
world alliance” and “The SkyTeam Alliance”. This has advantaged the
airline in not being hindered by the bureaucratic nature of these
organisations. Alliances work for their own advantage in terms of cutting
cost. Since Emirates is not part of these alliances they can create value
without any pressure (Juna Alacer, John Clayton , 2014). The code
sharing partnership with the Qantas Airways and Jet Blue have provided
access to USA and 55 destinations in Australia.
Human resource
management
The staff is trained from Emirates Aviation College and then they are
deployed for the duties. Secondly the staff is effective enough to cater to
the diverse backgrounds of the passengers. The staff is capable of
speaking multiple languages and they know how to respect different
cultures (Juna Alacer, John Clayton , 2014). Moreover 4000 days
training was given to 35000 employees this year (Emirates Airline, 2017
).
Technology
Development
The Emirates Airline has their in-house research and engineering centre.
Along with that to ensure effective convenience to the passengers they
have computer reservation system and flight scheduling system. They
have the sound aircrafts with on flight wi-fi systems. 85 C-Checks were

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conducted on the fleet during the entire year to keep the aircrafts in the
best condition (Emirates Airline, 2017 ).
Procurement This includes the on-board product and amenities, in-flight catering, air
traffic control charges and the jet fuel. Three jet fuel suppliers to
Emirates are BP, Chevron and Shell (Emirates Airline, 2018).
Primary activities
Inbound
logistics
The passengers of Emirates Airline are passed through terminal 3 which
is hassle free and more technologically sound. Along with that the
distribution centre is there which has office consumables, airline
stationary. Uniform distribution system is there which provides for staff
uniform and accessories. Technical and P&L centre provides spare parts
and fuel for all ground equipment and the inflight service stores provide
all products used on the aircraft such as wine, foods, and paper and
plastic products (Emirates Airline, 2018).
Operations On-ground operations includes the airport landing and parking charges,
airport ground handling, crew hotels, CIP lounges, chauffeur drivers ,
baggage services and check-in (Emirates Airline, 2018).
Marketing and
sales
Emirates in order to attract the tourists, they have partnered with the local
tourist organisations and they offer tourism packages. The airline
scheduled the bookings to allow the stopover of the flights for no cost.
Moreover they have reached global audience by sponsorship of sport
events. They have also created the impact of luxurious flight through
premium in-flight experience (Juna Alacer, John Clayton , 2014).
Service Sky wards is 16 years old reward program that has over 17 million
members and it allows for new initiatives in form of reward options for
the members. Moreover they have also introduced pay per visit lounges
for the first and business class passengers at the Dubai and other airports
worldwide (Emirates Airline, 2017 ).
Table 1: Value chain table
This value chain model have recognised that the key link exists strongly between the inbound
logistics, human resource management and the technology that helps Emirates to deliver
effective services to their passengers.

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Competency framework
Threshold resources
The diverse cabin crew and well trained staff
help the airline to better manage the
operations and pacify their customers.
The technical and modern equipped fleet of
265 aircrafts with average age of 6.4 years is
the backbone of the airline.
Threshold competencies
The advantage of terminal 3 allows hassle
free and speedy dealing of passenger traffic.
Choosing new routes and continuously
moving towards the new markets and new
route decision has helped to develop new
stream of revenue for the company but the
limitation of entry to new markets and risk
required 6 to 12 months of research which
reduces the risk and make it sustainable (Juna
Alacer, John Clayton , 2014).
Distinctive resources
The Airline staff training college allows the
airline to prepare the staff according to its
work requirements.
The digital transformation has led to
transformation of customer experience and
this has made it more personalised.
Operations work by robotics, biometrics, and
automation and back office functions.
Distinctive competencies
The zero accident policy and the way air
crafts are managed by the 85 C Checks
conducted yearly are very advantageous for
smooth running of the airline.
The focus on the environment through the
use of Flex Track program, and using ECO-
Thread technology for 100 per cent recycled
and environment friendly bottles reflect the
sustainable operations.
The new aircrafts such as A-380 and Boeing
777 are designed to offer luxurious services
to its passengers which makes it completely
unique and standout from the competing
airlines.
Table 2: Competency framework of Emirates Airline
VRIO Framework
Valuable? Rare? Difficult to
imitate?
Exploitable
by the
organisation?
Competitive
implications
R1- human
resource
Yes No No Yes Competitive
parity
R2- young and
modern fleet
Yes Yes No Yes Competitive
parity
R3- Training
college
Yes Yes Yes Yes Sustainable
parity
R4- Digital
transformation
Yes No No Yes Competitive
parity
C1- terminal 3 Yes Yes Yes Yes Sustainable
parity
C2- New
Markets and
new routes
Yes Yes No Yes Competitive
parity

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C3-
maintenance
of fleet
Yes Yes Yes Yes Temporary
competitive
parity
C4-
Environment
friendly
initiatives
Yes Yes No Yes Sustainable
parity
C5- luxury
service to the
passengers
Yes Yes Yes Yes Competitive
parity
Table 3: VRIO Framework
From the VRIO framework it has been observed that the biggest resources of airline are its
people and technology that helps to make the system work in the best possible manner. The
other competencies are luxury experience for passengers, digital transformation and
environment friendly initiatives that create core competitive advantage for the airline.
This section has used three frameworks to identify the internal strengths and weaknesses of
the airline and they are as under.
Strengths Weaknesses
Sound fleet Risk in entering new routes
Luxurious brand image Restrictions on exploiting new routes
Trained and diversified staff No low cost packages such as offered by
competing airlines like Etihad Airways
No alliance joined and code sharing
partnership with Qantas Airways and Jet
Blue.

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Part 3- Company’s corporate and business strategy
In this section Bowman’s strategy clock will be used to explore the strategic positioning of
the Emirates airline. This clock takes two dimensions to evaluate the product: the perceived
value on one axis and price on the other.
Figure 5: Bowman’s strategy clock
The two strategies that Emirates use are Differentiation and focused differentiation. The aim
of differentiation is to give passengers the highest level of services that they have perceived.
In this regard branding plays a very important role and also the service quality. This strategy
is applied along with the focused differentiation strategy which aims to position the service at
the highest price, passengers will avail the service because of the highest perceived service.
This can be observed in the first and business class services being offered by the Airline.
Emirates Airline have positioned its service and laid emphasis on giving the passengers
premium experience to reap the benefits from customer loyalty and also to avoid the direct
competition from the airlines that offers low cost packages (Juna Alacer, John Clayton ,
2014).

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Part 4- Identification of issues and challenges faced by the company
If we analyse the external challenges, the most important ones are the socio-political
challenges that has affected the profitability of the airline by 75 per cent in the first quarter of
2016-2017. The leadership team have blamed the impact of tensions in the Europe and other
MENA region and the strong dollar currency. Moreover the economic tensions going on due
to the low oil prices have severely damaged the economies of Saudi Arabia, Yemen, Muscat
and this have affected the demand patterns of travel too. Along with that the airline has to
face massive competition from the Qatar and Etihad Airways who have also launched their
services on long destination routes where Emirates operates too (Dominic Dudley, 2016).
Moreover the other major challenge that the airline faces is the anti-competitive claims.
Emirates operate as sole owner and as the CEO Tim Clark pointed that they don’t have to
face issue from the 200 stakeholders for hedge funds to rating agencies. This structure gives
Emirates undue advantage which the other airlines blame goes against their benefit.
Therefore the airline has been accused of these claims especially in US and they have to face
restrictions on entering newer routes (Juna Alacer, John Clayton , 2014).
The internal weakness and one of the biggest challenges is the reliance on offering premium
service. The recent reports have shown that the airline is overly ambitious and works towards
unsustainable future growth plan which is evident by the aircrafts that are ordered. In the year
2016-2017 they have managed to involve the fleet roll-over of 62 aircrafts. Moreover the
reliance on premium service was consistent with the older generation but what about the
uncertain demand from the millennial who would aim for convenient yet affordable service
(Economist.com , 2017 ).

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Part 5- Identification and evaluation of the main strategic options for
growth
This section will generate two options for growth and development using the Ansoff
Matrix,SFA framework and evaluate the resources that will be needed to implement the
strategic options chosen.
TOWS Matrix
TOWS Opportunities
1) growth and
stability in Asian
regions
2) Preference given
because of luxury
airline.
3)Diversification of
routes
Threats
1) Socio political
factors that have
affected the demand
for travel.
2) low cost airline
competition
3) regulations from
governments
internationally.
Strengths
1) Sound fleet and air
operation system
2) luxurious brand
image
3) Trained Human
Resource
4) Advantage of
terminal 3
5) Code sharing
partnership with the
Qantas Airways and
Jet Blue.
SO
Using the sound fleet
system and trained
staff to enter the
Asian routes and
serve these stable
regions.
ST
The advantage of
terminal 3 gives
Emirates leverage
over other competing
airlines.
Weaknesses
1) risk in entering
new routes
WO
Due to restrictions on
entering the new
markets they can
WT
The unstable demand
patterns call for the
low-cost and

19. 18 | P a g e
2) restrictions on
entering new
destinations
3) lack of low cost
packages as offered
by the competitors
look for more code
sharing partners and
can cover the new
destinations.
convenient packages.
Table 4: TOWS Matrix
Growth options using the ANSOFF Matrix
Figure 6: Ansoff’s Matrix
Option 1: Market penetration: with the regional instability in the destinations that Emirates
Airline serves along with the weak demand for travel, affordable and low cost packages can
be offered. The airline has the necessary resource to offer this package but the management
team should see that what image the low cost will put on the brand image of “luxury”.
Option 2: Market development: working on exploring the newer destinations such as in
Asian regions where the stability is there. For this code sharing partnership will be required.
Moreover this strategy will take time to work because there is presence of various airlines
such as Thai Airways and they are members of Star Alliance which gives them an advantage.
The airline will need more analysts to predict the route feasibility and will need to have more
intellectual and physical resources for this.

20. 19 | P a g e
SFA Framework
Option 1 (1-5) Option 2 (1-5)
Suitability 14/15 12/15
Exploits the brand image 5 2
Increased profits 5 5
Fulfils company values 4 5
Feasibility 9/10 6/10
Use of existing resources 5 3
Achievable in one year 4 3
Acceptability 12/15 15/15
Positive stake holder
reaction
3 5
Market share increase 5 5
Expansion of customer base 4 5
Total 35/40 33/40
Table 5: SFA Framework
Recommendation and conclusion
Based on the last section related to the SFA Framework the most feasible option is option 1
because it is suitable. With the low cost package Emirates can increase its customer base and
since they have an idea on operating in the current regions so they can better evaluate. The
option is also feasible because it will not require additional resources otherwise the option2
would have. Thirdly its acceptable too as it will help to increase the market share and
increased customer base.
Thus based on the internal and external analysis and use of different models it can be
concluded that Emirates is in a very uncertain situation because of the external factors that
cannot be eliminated however reduced and the leadership team should work on the option
suggested above but by low cost travel they should not hamper their quality else provide
more convenient and comfortable flight.

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