Enda Corneille joined Emirates as the airline's Irish country manager in August 2014, at a pivotal point in its history in this State – shortly before it increased its flights on the Dublin to Dubai route from once a day to twice a day.
The move was well-flagged and made sense for the Gulf carrier, as its business here had grown far quicker than expected.
It was a “bit of a baptism of fire”, Corneille recalls.
But he need not have worried. Two years later, Emirates is filling 78 per cent of the 22,000 seats a month that its aircraft carry on the route.
“We are currently tracking 16 per cent ahead of last year,” he notes. “In fact, as we go into 2017, we are going to increase our capacity further.
"The aircraft we are operating have 360 seats. They are Boeing 777s, so we are going to upgrade one of those to a 428-seater. We still see there's growth in the market."
The increase in capacity will come slightly ahead of next year, as the first 428-seater aircraft will take off from Dublin on December 28th and remain on the route right through 2017.
Cargo market
Alongside the passengers, Emirates has a strong cargo business. The holds of its aircraft are consistently 90 per cent full – with anything from live animals to pharmaceuticals, food, and even baby formula, which is ultimately destined for China.
“The belly of the aircraft is very big, so it gives us the chance to sell actively into the cargo market,” Corneille says.
While filling 78 per cent of capacity may seem high, local carriers regularly fill a far greater proportion of their planes.
Aer Lingus consistently has load factors well above 80 per cent, while Ryanair's top 90 per cent.
Corneille points out that these airlines generate some profits from ancillary revenues – selling food, drinks or charging for extra bags.
As a consequence, they have to focus on selling more seats.
That does not mean that Emirates’ craft are never full. The airline regularly sells over 90 per cent of its seats during peak times. Corneille says its focus is to maintain a balanced business throughout the year.
Middle Eastern hub
About 80 per cent of its passengers travel – or fly in from – beyond Dubai, connecting at the Middle Eastern hub, now the world’s busiest airport, to and from other destinations on the Emirates network.
Australia is one of the obvious ones, particularly given that so many Irish people emigrated there during the recession. That increased demand, as they and their families travelled between the two countries.
However, that is only one element of its business.
Passengers also travel to airports such as Trivandrum and Cochin in India, Guangzhou in China and Nigeria.
"These are big markets for migrant workers living in Ireland, " he points out. "Then you have people holidaying in the Indian Ocean, the Maldives, Seychelles, Mauritius.
“And you have companies doing business in China and Australia, so you’ve got a very wide mix. When you are talking about an operation of that scale, 70 per cent to 80 per cent is where you want to be.
“At Christmas time, at Easter, you can sell 97 per cent of your seats – but those are busy times and you would expect that to be the case.”
Part of the thinking behind the move to a twice-daily operation was to open up more destinations and carve a bigger slice of the market to and from Ireland.
Emirates flights are timed to allow travellers connect to onward flights. For this to work, Corneille explains that it has to be daily.
Next month’s further increase in capacity indicates that it is working. And Corneille believes the expansion may not stop there.
Natural progression
“If you spool forward, the natural progression for us in the Irish market is to bring in the Airbus A380,” he says. “Emirates have 84 A380s and we have 58 coming in the next number of years. If Ireland continues on this growth track, it would be no surprise that we would see it landing in Dublin. To put it in scale, you are talking about 615 seats every flight.”
Dublin Airport has “a bit of work to be done” before A380s can land there, he cautions.
In that respect, Corneille agrees that its plans for a second runway are good news for both his operation and other airlines, though he sees signs that the airport’s infrastructure is showing the strain of continued growth.
Passenger numbers this year are on track to break the 25 million record set in 2015.
“I think the growth of activity at Dublin Airport has maybe taken people by surprise,” Corneille says. “What I would say about the pressure there is that I do not believe that the consumer experience is impaired significantly. But if you go forward two or three years, and if the airport keeps growing, it will make it very uncomfortable.”
If the crowds seen in the early mornings in terminal two – where Emirates’ aircraft take off and land – were to grow significantly, he argues it would be difficult for check-in and security staff to handle. Consequently, he believes that a third terminal is a natural consequence of a second runway.
Growing bottlenecks
Corneille is not the only one who has noticed the growing bottlenecks in Dublin Airport. Aer Lingus chief executive Stephen Kavanagh warned of their possible impact on its growing transatlantic business earlier this year.
The airport’s manager, State-company Dublin Airport Authority (DAA), shares Aer Lingus’s view that Dublin is ideally positioned to develop as a transatlantic hub, and has been working on responding to the airline’s concerns.
Does Corneille believe that this has brought about a shift in DAA’s priorities away from businesses such as his, which are flying in the opposite direction?
The short answer is “no”, but he couches his response with the warning that US air traffic can drop sharply in some circumstances.
“It is prone to shocks, far more so than others,” he says. “If I look at our business in Emirates, no one market, in terms of region, delivers more than 30 per cent of our revenue, so we are not dependent on UAE, or Australia or America; it’s fairly even.
"I know by experience, sadly, that it does not take much for something to happen for US customers to switch off travelling to Europe. "
Part of the experience to which he refers is working on the turnaround of Aer Lingus – then led by fellow Dubliner Willie Walsh, who is now chief executive of that airline's parent IAG – when its transatlantic business suffered along, with that of the whole industry, following the 9/11 attacks on the World Trade Center in New York in 2001.
Corneille joined Aer Lingus as a clerk straight from school in the 1980s and worked his way up through the organisation, which was wholly State-owned in those days.
He spent a part of this time abroad, working in such places as Sweden, the Netherlands and the UK.
Between 2010 and 2012, he fulfilled a long-term ambition to do an MBA, focused on aviation, and then did a stint teaching with industry body, the International Air Transport Association (IATA). After two years and yet more travelling, he took up his current job.
Currency volatility
For the moment at least, Corneille says it appears that the traditional link between growth and air travel is broken.
Airlines tended to benefit as countries got richer and suffered in downturns.
However, in Europe, that does not appear to be the case: economies are flat-lining but air travel is still growing.
Nevertheless, he warns that there are challenges ahead. Currency volatility is one of them.
"In our business, a 4 or 5 per cent margin is stellar," he says. "Last year, Emirates did 8.4 [per cent], Ryanair is in the teens, but so many airlines are below the 4 or 5 per cent. It does not take much to tip them below the line.
“The dollar is very strong at the moment. Airlines pay all their big bills in dollars. If you are not a US-originating carrier or you don’t do a lot of business in the US, you have to buy your currency – so just a few percentage points on the currency could wipe out a bottom line.”
Dollar exchange rates and oil prices are two sides of the same coin in aviation.
Oil began tumbling from above the $100-a-barrel mark shortly after Corneille joined Emirates. Fuel has gone from 35 per cent of its cost, at that time, to 26 per cent now. But most in the industry believe prices will begin to rise again in about a year.
Corneille argues that airlines will have to able to make money at around $75 to $80-a-barrel if they are going to survive.
“Low fuel risks covering a myriad of sins,” he says. “It’s all about the fundamentals of your business. If you can only be profitable at a fuel price of $47, you are in real trouble when it goes to $50 or $55. If and when it gets to $75, if that was a new normal, I think you are going to see casualties out there.”
Brexit
Brexit is one of the culprits for recent currency volatility as the vote weakened both sterling and the euro against the dollar.
The UK accounts for about 16 per cent of Emirates’ capacity. Its departure from the EU would also mean that Europe’s biggest airport, Heathrow, would find itself outside the union.
“The UK is a market in which we have invested heavily,” he says. “So far, we haven’t seen any major shifts in demand. In the Irish context, one of the interesting achievements we’ve had here has been attracting customers from Northern Ireland to fly on our services from Dublin.
“That’s something for which we have worked very hard. Were a hard border to be put in between Northern Ireland and the Republic, that certainly would impact our business. But at the moment it’s anybody’s guess where that’s going to end up.”
On the whole, Corneille is optimistic that Brexit will not ultimately dampen consumers’ appetite for air travel.
“The people leaving school now have never known a world without low-cost airlines,” he says. “People will still want to travel, airlines will still be needed to fulfil that demand.”
Enda Corneille's CV
Name: Enda Corneille
Age: 51
Family: married, three children
Position: Emirates Air, country manager Ireland
Why is he in the news? The airline is planning to boost capacity in Ireland and may ultimately use 600-seat Airbus A380s to serve its Dublin-Dubai route.
Career: Joined Aer Lingus after leaving school and worked his way up through the organisation, spending a period abroad and returning to Ireland when the airline faced a crisis in the early years of this century. Did an MBA in 2012 and spent a period teaching with the International Air Transport Association before joining Emirates in 2014.
Something you might expect: He was accepted into Trinity College Dublin to do a PhD within aviation, just before he joined Emirates.
Something you might not expect: He once played guitar and drums in a rock band in Lapland.
