Hogan says Etihad still 'committed' to its partnership model
Etihad remains "committed" to its partnership model of holding stakes in airlines from Air Berlin to Alitalia despite challenges, ceo James Hogan has insisted.
Speaking at the Global Airfinance conference in Dublin, Mr Hogan acknowledged that the partnership model has been tested.
Etihad used to own 5pc of Aer Lingus, and among its stakes in other carriers holds just under 30pc of Air Berlin and 49pc of Alitalia. But Alitalia has been losing about €500,000 a day and Air Berlin has struggled - making an operating loss of €62.7m in the second quarter of the last financial year and a net loss of €45.6m in the third quarter. Mr Hogan said the initial restructuring at Air Berlin hadn't been rapid enough. "We have faced... challenges with Alitalia and Air Berlin," he said adding that both airlines demonstrated why "fundamental change" is critical in the aviation industry. Etihad signed a codeshare agreement with Lufthansa in December, but has dismissed speculation that it is planning to buy a stake in the German airline.
Mr Hogan also said 2017 will be a difficult year for airlines. "The industry does face significant challenges," he said.
The chief economist of the International Air Transport Association, Brian Pearce, told the conference that airlines might end up being "disappointed" about the strength of the current cycle in 2017.