We'll open our books if you will: Emirates Airline :: The Australian

Quote:

Emirates chairman Sheik Ahmed bin Saeed al-Maktoum, responding to media questions over the financing of the airline's $12.66 billion order for 42 777s this week, said his airline would open its books to any airline - but they had to reciprocate. "We are delighted to have our books examined but these airlines must be prepared to respond with their accounts," Sheik Ahmed said.

Sheik Ahmed said many airlines were controlled by governments and "many had been bailed out by their governments". Air France, Malaysia Airlines and Alitalia have received huge bail-outs in the past 10 years and US airlines have walked away from obligations through the Chapter 11 provisions.
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"Dubai has GDP growth of 16 per cent a year. We started in 1985 with just three aircraft and only $US88 million from the Dubai Government. We have not had one cent since. We get no government guarantees and our unit costs are much lower because we work hard and smart at what we do," [Emirates president Tim Clark] said.

Many airline CEOs have rightly claimed that neither Emirates nor its staff pay taxes, but Mr Clark pointed out that Emirates had significant social costs in housing, education and travel for the airline's mainly expatriate staff.

In a recent JPMorgan Securities report, Emirates' accounts were given a clean bill of health. "We cannot find anything in Emirates' accounts which indicates that the business is subsidised directly or indirectly or given undue preferences," the report said. Emirates accounts are audited by PricewaterhouseCoopers.

Much of the heated debate surrounds the claim that Emirates receives free fuel. Mr Clark said that in Dubai, Emirates bought fuel from five fuel suppliers including Shell, Caltex, BP and Exxon.

If Emirates is not heavily subsidized, then what are the factors behind its success? Would those factors be revealed by its books? If those factors become known, can they be adopted by other airlines? And if they are, wouldn't that cut into profits at Emirates?