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Speaker 1: The world's largest international airline is charting an aggressive path

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Speaker 1: forward coming out of the pandemic. Emirates President Tim Clark

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Speaker 1: says the company's growth plan could include big orders from

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Speaker 1: Airbus and Boeing to bolster its fleet of jumbo jets.

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Speaker 1: Clark spoke about the airlines plans with host Guy Johnson

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Speaker 1: at the Lisbon Aviation Festival.

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Speaker 2: Demand has been very strong. Is it going to continue

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Speaker 2: to be very strong? How do you see the winter?

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Speaker 2: How do you see twenty twenty four?

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Speaker 3: Well, our forward bookings are very strong throughout the rest

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Speaker 3: of the financial year, going through the winter till March

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Speaker 3: study first. So yeah, it's looking good.

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Speaker 4: The period of.

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Speaker 2: Revenge travel, I think, as a lot of people are

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Speaker 2: calling it, is that coming to an end.

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Speaker 3: This is an interesting term. I'm not sure I recognize it.

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Speaker 3: If they have been revenge travel, we would have seen

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Speaker 3: a tapering of demand, but we haven't seen that. We've

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Speaker 3: got problems like the Sudan situation, Ethiopia wherever it may be.

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Speaker 4: But in terms of the trunk operations, Africa.

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Speaker 3: And generals, Oceana, South America, Europe very strong and continue

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Speaker 3: to be strong, Thank goodness.

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Speaker 2: We had the three eighties, you're gonna let that one go.

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Speaker 2: Is the market becoming more price sensitive though, as far

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Speaker 2: as we can see, no, And this is an interesting one.

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Speaker 3: For all the years I've been in this business and

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Speaker 3: the bounce back there's always happened, whether it be nine

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Speaker 3: to eleven, the golf walls, et cetera, et cetera, the

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Speaker 3: financial crisis, We've always bounced back in a very robust manner.

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Speaker 3: And when I looked at COVID, I thought this will

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Speaker 3: be something even bigger than that. But in each of

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Speaker 3: these crises you've seen or return to equilibrium far sooner

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Speaker 3: than it has in this particular case. So what we're

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Speaker 3: looking at now is a sustained demand at higher prices

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Speaker 3: coming at us For every seat we offer on many

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Speaker 3: of our routes that are about three people and wanted.

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Speaker 3: The skill rate is very high and we can't see

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Speaker 3: anything changing on that now. There have been a few

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Speaker 3: changes in the sense that Devine has now become a

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Speaker 3: truly global metropolis and its brand has extended all over

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Speaker 3: the world, so people want to come there. They are

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Speaker 3: moving there in large numbers. And what's the Brits coming

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Speaker 3: down where to live and work? So that has been

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Speaker 3: slightly transformational in the structure of the demand segments, and

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Speaker 3: that means generally higher yields. But in all the sick

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Speaker 3: freedom markets, the cross flows that we see, it's been

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Speaker 3: extraordinarily strong and robust and looks like it's staying up.

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Speaker 4: Is it strong enough?

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Speaker 2: Is it strong enough to sustain significantly higher fair at

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Speaker 2: higher oil prices? Do you suck that cost up or

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Speaker 2: can you pass it on? Its demand strong enough for

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Speaker 2: you to pass it on.

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Speaker 3: We have what we call the floating surcharges, the ore

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Speaker 3: price moves we put the search.

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Speaker 2: Charge goes up and down with it, and there's no

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Speaker 2: head to demand with it when it goes on.

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Speaker 4: No, it isn't.

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Speaker 3: So the price in elassicities are quite a shock to us,

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Speaker 3: to be quite honest. You know, when we came through COVID,

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Speaker 3: I basically said to the business, basically, we're going to

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Speaker 3: spend more on product and doing a lot better than

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Speaker 3: we did before, rather than going south and cutting front

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Speaker 3: end products, which is what we've done. And we've been

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Speaker 3: able to afford that simply because the demand has been

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Speaker 3: so strong so long.

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Speaker 4: Mayte last I cannot say two three, four years, what's.

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Speaker 3: Going to happen or I think I've got right in

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Speaker 3: the in the forecasting that the world would move very

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Speaker 3: quickly after the end of COVID, which is what it did.

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Speaker 3: We positioned ourselves on that basis. It was high risk

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Speaker 3: taking all the crews back, getting the aircraft ready for it.

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Speaker 3: Fortunately came good and so we were able to capitalize

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Speaker 3: on that.

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Speaker 4: So we will continue to graft fleet.

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Speaker 3: You know, I look at post COVID as a third

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Speaker 3: era for US, third epoch.

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Speaker 4: I'm very optimistic about it.

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Speaker 3: We talk about AI, the embracement of technology making is.

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Speaker 4: Far more efficient in what we do.

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Speaker 3: Fleet are becoming far more efficient in terms of design, propulsion,

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Speaker 3: et cetera. I think it's quite a good story. Annu

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Speaker 3: oil as it is. As I said earlier, it'll settle back.

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Speaker 3: We've been up at one hundred one hundred and ten before.

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Speaker 3: Crack spreads are worrying, but so far the markets are

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Speaker 3: taking the price points at are result of what we're

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Speaker 3: having to face to deliver the the margins that we.

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Speaker 4: Need to keep going.

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Speaker 2: You are one of the world's biggest buyers of aeroplanes.

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Speaker 2: You still are clearly in love with the the A

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Speaker 2: three eight, but you can't buy any more of those,

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Speaker 2: So the question then comes, what are you going to

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Speaker 2: buy and in what timeframe we're going to be buying them.

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Speaker 2: You made a hiring announcement a few days ago. We

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Speaker 2: all kind of sat up and paid attention to what

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Speaker 2: you were saying. And the reason that you that we

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Speaker 2: set and paid attention was you talked about hiring from

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Speaker 2: a number of different aircraft types, but you didn't mention

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Speaker 2: the seven eight seven.

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Speaker 4: Isn't that significant?

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Speaker 3: Well, look, the seven eight seven isn't in the short

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Speaker 3: term picture at this point in time. Yes, we're talking

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Speaker 3: about about the seven eight seven. We quite lightly aeroplane, So.

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Speaker 4: There's no news coming out to buy the Bayo show.

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Speaker 4: What's the space? What's the space?

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Speaker 3: As I said, we're in talks with Bowie, as we

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Speaker 3: are with their of US YEP, and we are hiring

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Speaker 3: large numbers of crew, many many of those will be

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Speaker 3: direct entry captains onto three eighties or whatever, simply because

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Speaker 3: we're moving some of those pilots onto the three fifties.

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Speaker 3: We'd start arriving in July August of the next year, and

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Speaker 3: we have fifty of those being delivered in rapid order,

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Speaker 3: So we have to move our pilots around, so we

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Speaker 3: need we know we have to recruit the seven seven

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Speaker 3: seventy nine is hopefully coming at the end of twenty five,

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Speaker 3: the three fifties next year. We need more nines probably

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Speaker 3: in the future because of the retirement of the three eighties.

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Speaker 3: We're looking at the three fifty one thousand quite seriously.

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Speaker 3: Still got propulsion issues with roles. Hopefully they'll get resolved

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Speaker 3: in the next couple of years. So to the point

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Speaker 3: I made earlier about the new era, yes, we've got

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Speaker 3: a lot of big plans for the airline going forward,

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Speaker 3: new fleet, larger numbers, larger network, working with Divide, so

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Speaker 3: it's I think it's going to be quite a good story.

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Speaker 3: We've learned a lot from COVID. It reset our thinking,

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Speaker 3: reset our processes, and we came out of that having

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Speaker 3: made the largest profit we've ever made last year and

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Speaker 3: this year it's going sude.

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Speaker 2: Final question YUI is about to host COP twenty eight,

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Speaker 2: huge event sustainability, aviation sustainability front and center. The cost

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Speaker 2: of making this industry sustainable? Are we being honest about it?

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Speaker 2: Do you think the do you think this is the

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Speaker 2: aviation industry will have to be smaller given how expensive

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Speaker 2: the fuels are going to be. Do you think people

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Speaker 2: will be flying less because of how expensive fuel is

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Speaker 2: going to be?

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Speaker 4: If this industry is truly.

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Speaker 2: To make its targets at twenty fifty, Well, to deal

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Speaker 2: with the first question, are these targets achievable?

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Speaker 4: Are we really kid ourselves into what we can do?

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Speaker 4: At the moment?

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Speaker 3: Technology is there for us to do whatever it may be, ESA, hydrogen,

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Speaker 3: et cetera. The scaling of that technology and the power

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Speaker 3: required to scale.

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Speaker 4: As well as all the elements and pieces is not

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Speaker 4: there yet.

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Speaker 3: Okay, so we need to set back and now I

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Speaker 3: would like to see if we talked about on the

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Speaker 3: stage earlier, I'd like to see some kind of body,

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Speaker 3: if it's under the UN, under AKO, where they actually

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Speaker 3: thrash out the issues of civil aviation going forward, rather

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Speaker 3: than take views about mandates and punitive penalties and carbon credits,

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Speaker 3: et cetera.

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Speaker 4: What is the truth of all this?

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Speaker 3: Ask yourself what is the truth and how are we

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Speaker 3: going to deal with it? And then publicize that whether

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Speaker 3: it's good reading or not, it's.

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Speaker 4: The statement of truth.

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Speaker 3: Rather than being caught out all the time and coming

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Speaker 3: up against multiple governments with different agendas as to how

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Speaker 3: you deal with this, and in the end it's huge,

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Speaker 3: will be huge, impunitive, and in the end it'll cost

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Speaker 3: more to fly.

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Speaker 4: Do we want that, No, we don't.

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Speaker 3: The global population continues to grow, we must recognize that

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Speaker 3: as a population grows, demand will be in lockstep with that,

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Speaker 3: probably more as we become Look world forward five years,

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Speaker 3: ten years will be on a three day week. Okay,

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Speaker 3: you'll have robotics driven by AI. You'll have a lot

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Speaker 3: of the menial task. Sorry, this is probably heresy to

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Speaker 3: a lot of people. Those tasks will be done using

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Speaker 3: the power of information, Artificial intelligence, and robotics will be

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Speaker 3: increasing at the pace, a lot of which we don't

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Speaker 3: see because they are in another sphere used for other purposes.

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Speaker 4: But eventually it'll break out.

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Speaker 3: That will create more leisure, time, more and providing the

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Speaker 3: wealth created by technology is distributed fairly and evenly and

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Speaker 3: not withheld by a few for the fuel, then you

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Speaker 3: can see more leisure in people's lives, their ability to

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Speaker 3: determine what they want to do. Hopefully that'll be traveled.

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Speaker 3: They'll want to go and see things, not just staycations.

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Speaker 3: But look at the world because now digital technology is

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Speaker 3: providing a fantastic five g o led screen in front

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Speaker 3: of you, which you've could almost be there if you're.

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Speaker 4: Wanted it to. So when I see this taking us,

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Speaker 4: is that.

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Speaker 3: A human having more leisure time, more disposable income on

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Speaker 3: the basis that it is distributed fairly, but technology can

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Speaker 3: get us there.

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Speaker 4: Now, this is the difficult how do you deal with that?

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Speaker 3: It's not just aviation, but how do you deal with

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Speaker 3: large elements of the workforce who don't benefit from that

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Speaker 3: wonderful thing In the developing world, they.

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Speaker 4: Are the ones that will be disadvanced. How do you

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Speaker 4: deal with that?

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Speaker 3: Because it'll get into the question of the morality of

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Speaker 3: what we're doing in fairness and sort ef ganitarian approach

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Speaker 3: to how we do it.

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Speaker 4: And that's the way I look at it. The aviation

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Speaker 4: industry is one of many that has to face that.

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Speaker 3: But in the end, if you cherry pick and you

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Speaker 3: don't come up with something that is well understood, the

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Speaker 3: messaging is clearly wrong at the moment, and I you know,

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Speaker 3: COP twenty eight the it's got a fantastic story to tell,

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Speaker 3: and we're talking about do by being powered forty percent

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Speaker 3: of its power solar in the next few years. You

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Speaker 3: have nuclear being produced there, you've got vast solar rays,

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Speaker 3: you've got green hydrogen. They have the funds to be

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Speaker 3: able to develop the technology. A lot of the countries

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Speaker 3: appearing in COP twenty eight don't have that money. So

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Speaker 3: if these countries like the UA use that financial strength

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Speaker 3: to embrace refine sorry, wrong word, but to understand how

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Speaker 3: this is going to work and scale it, whether it

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Speaker 3: be saf whether it be saf et cetera. That's a

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Speaker 3: great story that comes out of it, but unfortunately it

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Speaker 3: gets kind of marginalized in some respects by aviation or

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Speaker 3: you know, two percent of what it's all about, and

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Speaker 3: we remain the whipping boy unfortunately because we're.

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Speaker 4: Not messaging across.

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Speaker 3: I'm a great believer in saying it as it is,

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Speaker 3: and we are the first to embrace anything that's thrown

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Speaker 3: it us that remove carbon from the way we go

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Speaker 3: about our business.

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Speaker 4: Unfortunately, I don't see that at the moment. Didn't expect

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Speaker 4: to finish that. Tim pretty Sea, thank you very much.

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Speaker 1: Indeed, that's Emirates president Tim Clark speaking with Guy Johnson

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Speaker 1: about his company's growth plan from the Lisbon Aviation Festival

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Speaker 1: to hear more conversations like this one, subscribe to the

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Speaker 1: Bloomberg Talks podcast, available on your favorite podcast platform.