Friday 15 / November / 2024
Dublin: Qatar Airways Chief Executive Officer Akbar Al Baker said he’s happy with the level of the company’s 15 per cent stake in British Airways owner IAG and won’t seek a seat on the London-based company’s board.
Al Baker said he views the holding as a strategic investment that will aid cooperation in areas such as joint fleet purchases, rather than a financial stake, and has no plans to raise it beyond the current level.
Qatar Air bought 9.99 per cent of IAG in January last year before building its position via a series of further purchases. While the Gulf carrier can’t take a majority holding because of European Union rules limiting foreign ownership to 49 per cent, the move has fueled speculation in Britain about Al Baker’s aims.
‘We are not a hedge fund,” the CEO said in a briefing in Dublin, where he’s attending the International Air Transport Association’s annual meeting. "We are not an investor that wants to get in and get out quickly and make big bucks.”
IAG CEO Willie Walsh said separately at IATA that there’s no prospect of the UK company taking a reciprocal stake in Qatar Airways, given the Gulf airline’s 100 per cent state ownership.
‘Completely separate’
"The way we need to look at Qatar is that there are two distinct elements to the relationship,” he said. "The equity stake is completely separate to the cooperation we have, which we’d do whether they had a stake or not.”
Qatar Air first drew closer to IAG after joining its Oneworld alliance in 2013, aided by the backing of Walsh at a time when other European carriers were openly hostile to the expansion of Gulf rivals. Al Baker said he didn’t discuss the investment plans with Walsh prior to executing the stock purchases.
The Gulf executive said he has big plans for Italian airline Meridiana, in which Doha-based Qatar is also seeking to invest.
The regional carrier, which operates a fleet including 30-year-old McDonnell Douglas MD-80-series aircraft, would be rapidly expanded and strategically repositioned he said, most likely with a transfer of Airbus Group SE A320 planes and A330 wide-bodies deemed surplus to requirements in Qatar.
Hub plan
An agreement on the Italian investment has been held back by union opposition and negotiation on labor conditions, and Qatar Air will walk away if those issues are not resolved this summer, Al Baker said.
Once the Meridiana situation has been resolved the Mideast giant will turn its attention to Royal Air Maroc, the Moroccan flag carrier, in which it’s seeking to purchase a 25 to 49 per cent stake.
Al Baker said he envisages the carrier becoming a hub player with an expanded network covering swathes of north and west Africa, and that an accord would likely include an agreement to help expand its Casablanca base.
The CEO said Qatar Airways will open a new route from Doha to Las Vegas next year, as well as a service to Dublin before then. It may also serve Belfast in Norther Ireland, he said.
A350, A320Neo
The delivery of Airbus A350s to the airline is set to resume after Al Baker discussed delays, linked to the delivery of plane interiors, with Fabrice Bregier, head of the planemaker’s jetliner unit, he said.
The A320Neo remains more problematic and Qatar Air has exercised a walk-away clause on the first plane it was due to take and will do likewise on subsequent planes when that right is triggered until a fix for engine glitches is implemented, he said.
Pratt & Whitney, which supplies the turbines for the Qatar planes, has said the improved version will meet all performance requirements, Al Baker said he’s exploring the possibility of taking A320Neos with engines from CFM International once those are available. A switch to Boeing Co. 737 Max is less likely, he said.
IAG isn’t currently exploring further acquisitions of its own, though has an appetite for further deals, Walsh said. The company was formed from a merger of BA and Spain’s Iberia and has gone to to buy discount carrier Vueling, UK rival BMI and Ireland’s Aer Lingus.
