The world aviat ion scenario is fast changing and the Middle East region is racing towards becoming an aviation hotspot. The credit goes to the Arabs who are using not just the petro-dollar to great effect, but also their vision, their foresight and their astute investment sense. And the tallest of the Arab is the ruler of Dubai (also the Vice President and the Prime Minister of UAE), Sheikh Mohammed bin Rashid Al Maktoum. Led by Emirates airline and the Dubai World Central International Airport, both soaring to great heights, the region is being transformed as major international aviation hub. Not just Dubai, but also Abu Dhabi which is home to Etihad Airways; Doha which prides Qatar Airways; and other capitals such as Muscat, Bahrain, Jeddah are up there, making waves.

There are many obvious advantages for Middle Eastern carriers, the foremost being fuel (35 per cent of airline’s operating costs) which is cheaper than the rest of the world. Airlines that have operating hubs in the Middle East benefit substantially. Another advantage is employee costs (16 per cent of airline’s operating costs) and most of the employees are expatriates. So there is a race not just among the airlines of the Middle East but also others who want to capitalise on these advantages.

Tsunami of Orders

It was a tsunami of orders from the Middle Eastern carriers that hogged the limelight signalling the return of good times. Emirates made a record-breaking announcement of a 200-aircraft deal (150 Boeing 777X and 50 Airbus A-380) for $99 billion.

Emirates said it is the, “largest ever aircraft order in civil aviation and also its largest order announced at any event to date.” The agreement was signed at the Dubai Airshow by Shaikh Ahmad Bin Saeed Al Maktoum, Chairman and CEO, Emirates Airline and Group, with Jim McNerney, Chairman, President and CEO, Boeing and Fabrice Brégier, President and CEO, Airbus.Following closely were Etihad and Qatar Airways with the former ordering 199 aircraft (mix of Boeing and Airbus) and 294 engines, for $67 billion. Qatar Airways ordered 50 Boeing aircraft worth $19 billion. It truly was an Arab rising of the aviation kind and the Dubai Airshow is right at the top, nudging aside Farnborough and Le Bourget.

Emirates All the Way

Striding globally, Emirates is becoming a popular choice of travellers worldwide, thanks to its connectivity, reasonable fares and incomparable passenger experience. To meet the growing demand, the airline is acquiring aircraft left, right and centre. At the Show, Emirates ordered $99 billion worth of aircraft, the Boeing 777X and the Airbus A-380 Superjumbo. Its sister airline “FlyDubai” weighed in with a $11.4 billion order for 111 Boeing 737s and 737-800s.

In the history of US commercial aviation, Emirates placed the single largest order for Boeing 777X by value and the additional A-380 order cements Emirates, already the largest operator of this aircraft type, as the principal customer for the A-380 worldwide. These latest orders bring Emirates’ total firm order book to 385 aircraft (excluding options), comprising 214 Boeing 777s, 101 Airbus A-380s and 70 A-350s for $166 billion.

“Air transport is a key enabler of world trade and we see that demand for aviation services will continue to grow globally. What we are announcing today is a continuation of our commitment and vision to connect the world through our efficient hub in the Middle East. Emirates’ aircraft orders today, with deliveries of the 777X scheduled to start in 2020, will take us to 2025 and beyond, replacing aircraft due for retirement and providing the foundation for future growth,” said Sheikh Ahmed bin Saeed Al-Maktoum, Chairman and CEO, Emirates Airline and Group.

Flagship of Emirates Fleet

Emirates currently operates the world’s largest fleet of A-380 with 39 in service. Its order for 50 additional A-380s brings the total A-380 order to 101 aircraft, worth $45 billion. A combination of two and three-class cabin configuration, the first 25 of these latest A-380 aircraft orders are scheduled to be delivered before the first quarter of 2018. “The A-380 continues to be the flagship of our fleet and after five years in operation, it remains highly popular with our passengers,” said Tim Clark, President Emirates Airline. “This latest order will help us meet both fleet expansion and replacement needs.”

Etihad Mantra - Organic & Inorganic Expansion

Unlike Emirates, the Abu Dhabi-based Etihad Airways has taken on the route of organic and inorganic expansion. Etihad ordered 56 new Boeing wide-body aircraft, with options and purchase rights for a further 26. The deal included 25 next-generation Boeing 777X, 17 of which are 777-9X and eight 777-8X aircraft. It also ordered a further 30 Boeing 787-10 Dreamliners and one Boeing 777-200 freighter making it the biggest customer for the American jet.

Etihad also placed orders with Airbus for 50 A-350 XWB and 36 A-320neo family aircraft, in addition to one A-330-200F freighter plus options for a further 30 freighters to support global expansion of operations.

The President and CEO of Etihad, James Hogan said, “We have announced 199 aircraft, 294 engines, positioning Etihad Ariways for the next decade of growth.” The total value of the deals is over $67 billion. Deliveries would start in 2018. Engines ordered include 127 GE Aviation, 115 Rolls-Royce and 52 CFM.

Etihad’s aggressive buying falls into its 2020 plan to have over 160 aircraft and nine fleet types that include ten Airbus A-380s and 41 Boeing 787 Dreamliners. The carrier aims to fly 25 million passengers annually to 120 destinations.

Etihad’s strategy has been clear and aggressive, aiming to grow fast and wide for which it is in the process of acquiring airlines and aircraft. It has equity stake in Air Seychelles, Air Berlin, Virgin Australia, Air Serbia and Ireland’s Aer Lingus. It is about to close a deal for a 24 per cent stake in India’s Jet Airways.

Expansion of Qatar Airways

With Emirates and Etihad on an expansion spree, Qatar Airways is not far behind. The Doha-based airline formally announced an order of 50 Boeing 777-9X, the first acquision of this variant. Currently, its fleet has various aircraft types including 51 Boeing 777s – extended range, long range and freighters, 37 of these are currently in service with the remaining pending delivery.

Qatar Airways CEO Akbar Al Baker said, “For Qatar Airways, the Boeing 777 is our flagship aircraft and the backbone of the fleet. Operational on many of the routes Qatar Airways flies to, it is well admired by our crew and passengers alike.I It is simply a fantastic aeroplane.”

Boeing Chairman, President and CEO Jim McNerney said, “Boeing is proud to have Qatar Airways amongst the launch customers for the new 777X programme. Qatar Airways has enjoyed remarkable worldwide growth in recent years and we look forward to continuing to support the airline on its path to further success in the future.”

Qatar Airways also placed a firm order for five new Airbus A-330-200 Freighter aircraft. These new aircraft will complement the airline’s rapidly growing network, which includes more than 40 routes that have dedicated freighter services. Included in the order are eight additional A-330-200F options which would make today’s deal worth over $2.8 billion for 13 aircraft.

Defence and Aerospace

With the Middle Eastern countries showing tremendous appetite for aerospace and defence, Boeing is zeroing in on this market showcasing a range of products and services including a United Arab Emirates (UAE) Armed Forces AH-64D Apache, an AH-6i light attack/reconnaissance helicopter, a Qatar Airways and Royal Brunei Airlines’ 787 Dreamliner and a ‘FlyDubai’ 737-800 featuring the Boeing Sky Interior and business class configuration. The Boeing P-8A Poseidon maritime patrol aircraft made its international Airshow debut.

“Our presence in the Middle East goes back decades,” said Jeffrey Johnson, President - Boeing Middle East, “We have earned the trust of our partners and customers here through meaningful collaboration, contribution to the community and by providing the right products and services at the right time. We remain committed to further expanding our presence and strengthening partnerships with governments, enterprise and customers to support the development and growth of regional aerospace infrastructure and capabilities.”

Airbus

Airbus’ commitment to cooperating with developing aerospace markets around the world was highlighted as the Middle East industry is playing a growing role in the company’s jetliners. This includes partnerships with two UAE-based companies - Strata, a Mubadala company and Tawazun Precision Industries (TPI), a Tawazun subsidiary. Strata is supplying components for Airbus’ A-330 wide-body aircraft and its 21st century flagship A-380 jetliner, while TPI is supplying parts for the A-320 and A-330. The Airbus Military A-400M airlifter was a first-time visitor here.

Iraqi Airways Picks Bombardier

Iraqi Airways signed a purchase agreement with Canadian manufacturer Bombardier which won orders and commitments for 27 of its Q-400 turboprops and CSeries mainliner jets. Among the biggest announcements was a purchase agreement from Iraqi Airways to acquire five CS300s, with options for another 11 valued at $1.26 billion.

Low-cost Thai carrier Nok Air ordered two Q-400s and options for six totalling $258 million. “The extra capacity seating option will give the Q-400 NextGen aircraft an advantage of up to seven per cent fuel burn per seat and an overall operating seat cost advantage of up to 17 per cent compared to its closest turboprop competitor,” said Torbjorn Karlsson, Vice President - Sales, Bombardier’s Asia-Pacific division.

Middle Eastern aircraft leasing company Palma Holding also signed an agreement to purchase four Q-400s along with four options, a $282 million order. Abu Dhabi-based transport operator Abu Dhabi Aviation and Ivory Coast national carrier Air Côte d’Ivoire also signed agreements for two Q-400s each.

ATR Debut in Saudi Arabia

ATR, the world’s leading regional turboprop aircraft manufacturer, displayed its new generation ATR-72-600 in the livery of Indonesia’s flag carrier Garuda. ATR had its first breakthrough in Saudi Arabia with Alpha Star Aviation Services becoming the first operator of ATR-72-600s. ATR and GECAS also signed an agreement for the acquisition of ten ATR-72-600s for a total value of $241 million. The agreement includes an order for five carriers and an option for another five. The Saudi orders will be delivered in 2014 while delivery to GECAS will begin in 2015.

GE, RollsRoyce Sign Deals

GE Aviation and joint ventures landed a record level of business orders totalling $40 billion, another trade record. Emirates airlines reached an $11 billion commitment to buy 150 Boeing 777X aircraft, containing 300 GE9X engines. The 777X twinengine aircraft and the GE9X engines are under development by Boeing and GE Aviation respectively and are expected to enter service by the end of this decade. Also included in the $40 billion orders for GE is $13 billion order for CFM International.

Engine maker RollsRoyce Holdings PLC bagged a $5-billion order from Etihad Airways to provide engines and long-term support for 50 Airbus A350 XWB aircraft and a $300 million order to provide engines and support to the five Airbus A-330s of Qatar Airways.

MEBAA – Its Humanitarian Face

The Middle East Business Aviation Association (MEBAA) signed a deal with the United Nations World Food Programme to donate $20 with every MENA private flight. Ali Ahmed Al Naqbi, MEBAA’s founding Chairman, said, “Our new ‘Fly and Feed’ programme is a commitment from MEBAA to support this most worthy cause. The idea might have come out of this region, but it will become global, through our association with the International Business Aviation Council.”

“Many people perceive our industry as a tool for High Networth Individuals. But this is not quite true. It is a tool for productivity and profitability. Our intention is to support the WFP, a great cause. With this, we want to change the perception of Business Aviation,” he said.

Al Naqbi suggested the regional industry would be worth $1 billion by 2018 and have 1,375 registered business aircraft by 2020, up from around 500 today. At the Dubai Airshow, about one-third of the aircraft on display were Business Jets. The biggies such as Boeing and Airbus had their Business Jets too, while other players such as Beechcraft, Bell Helicopter, Bombardier, Cessna, Dassault, Embraer, Gulfstream, Jetcraft, Nextant made their presence felt.

Embraer

Embraer Executive Jets announced purchase agreement with Arab Wings for Lineage 1000. The aircraft will join the super mid-size Legacy 600 and large Legacy 650 already with Arab Wings operating out of Jordan.. Delivery is scheduled for early 2014. “We are honoured by the confidence Arab Wings has shown in Embraer by selecting the Lineage 1000 to expand its business aircraft fleet in the ultra-large category,” said Colin Steven, Vice President EMEA, Embraer Executive Jets.

Military Aviation

Though commercial aviation dominated the show, military aviation had its moments in the sun as the defence equipment manufacturers understand the needs of the region. Unlike the open announcements of airlines, the militaries in the Middle East remain more insular. However, there is no denying the fact that the Middle Easterners are among the top defence spenders. The Saudi Arabia has the fourth largest defence budget in the world, behind the US, China, and Russia. Valued at $52.9 billion in 2013, Saudi Arabia’s defence expenditure is placed seventh among the top military spenders and is expected to increase at a CAGR of 7.92 per cent to reach $77.3 billion by 2018.

Other nations in the region are equipping themselves with the latest of defence equipment considering the geo-politics of the region. UK Prime Minister David Cameron was present at the show, presumably pitching for Eurofighter Typhoon. UK is competing with France for a potential 60-plane fighter jet deal with the UAE that is currently engaged in a procurement competition to replace its 43 ageing Dassault Mirage 2000s.

Northrop Grumman

Northrop Grumman Corporation highlighted a range of its global defence and security solutions, including airborne early warning and control systems, aerial surveillance and fire control radars. “Northrop Grumman is proud of its long trusted partnership with the UAE built over many years on a variety of programmes and capabilities,” said Douglas Raaberg, CEO Northrop Grumman, UAE.. The airborne early warning capabilities of its E-2D Advanced Hawkeye caught the attention of visitors.

Lockheed Martin

Lockheed Martin was present at the airshow, hoping that it would hear from UAE with regard to the proposed sale of an additional 25 F-16E/F Block 60 Desert Falcon combat aircraft. US Defense Secretary Chuck Hagel had stated earlier that the additional F-16 Block 60 aircraft would be provided as part of a five-billion arms package.. The UAE Air Force and Air Defence currently operate 55 single-seat F-16E and 24 twin-seat F-16F platforms.

AgustaWestland

Italian company AgustaWestland bagged orders from Dubai Police for five AW-169s and from the Dubai Air Wing for a single VIP-configured AW-189. AgustaWestland displayed mock-ups of AW-169 and AW-189 helicopters.

Dubai World Central Largest Airport

The Airshow was held for the first time at the city’s new $32 million Al Maktoum International Airport which is expected to become the world’s largest airport on its completion in 2027. This year the show attracted over 1,000 exhibitors and over 60,000 trade visitors, an increase of seven per cent from 2009.

Sharief Fahmy, CEO, F&E Aerospace, the organisers of the show said on the opening day, “Well it may have been yet another opening, but it certainly is not just another show. This has been an extraordinary opening morning for an event that has gone beyond expectations.”

“If there was anyone left in the aerospace industry who had not recognised the undeniable importance of this region, this morning removed all doubt. We are in the centre of a region with the world’s fastest-growing aviation infrastructure, fastestgrowing airlines and a region where security commitments are in focus.”