Etihad bets on premium leisure with return of ‘apartments’ in sky

Etihad Airways brought back its Airbus SE A380 superjumbos after three years in a bid to attract premium leisure travelers even as concerns emerge on resilience of the post-Covid holiday boom. 

The Abu Dhabi-based carrier is introducing the double-decker plane on its service to London’s Heathrow Airport, where it will deploy four A380s of its total fleet of 10 this summer. 

Etihad says it has seen more leisure passengers who previously flew in economy switch to premium since the end of pandemic-era travel curbs. With nine first-class “apartments”, as well as a three-room suite in the sky dubbed The Residence and 70 business-class seats, Etihad can offer more than double the premium seating on the A380 than with the Boeing Co. 787 jets it previously operated on the route. 

While business travel is still not up to pre-pandemic levels, the carrier is still seeing a surge of demand for premium travel especially on the London-Abu Dhabi route, according to Ed Fotheringham, Etihad’s vice president for Europe and Americas. Abu Dhabi’s Michelin-starred restaurants, five-star hotels and tourist attractions such as Ferrari World are popular draws for well-heeled tourists, Fotheringham said. 

While next-door neighbor Emirates continues to be the biggest cheerleader for the A380, operating over 100 of the type, only a handful of other carriers including Singapore Airlines Ltd., British Airways and Qantas Airways Ltd, have revived their much smaller fleets of A380s after demand surged post-pandemic. Emirates operates six A380s a day to London Heathrow, as well as additional services to the city’s Gatwick airport. 

Some airlines are less optimistic about robust demand continuing for the rest of the year, as pandemic savings erode and surging inflation and a higher cost of living squeeze wallets. Alaska Air Group Inc on Tuesday warned of a hit to its quarterly results as fares decline and domestic travel softens. 

Europe’s biggest discount carrier Ryanair Holdings Plc said this week that it might cut ticket prices this winter to ensure it can fill seats as passengers become more cost sensitive during the cost-of-living crisis. Even London’s Heathrow Airport also cautioned that leisure demand could soften post-summer because of higher consumer prices.

Stopover Traffic

Fotheringham said he wasn’t concerned about filling seats in the A380s because Abu Dhabi interconnects Europe to Asia, offering stopovers for holidaymakers who want to fly further afield.

Bringing back the A380s allows Etihad to “fill a gap” while the airline waits for delayed aircraft deliveries, some of which are expected later this year, Fotheringham said without elaborating. Etihad has pending orders for 32 Boeing 787s, 25 as-yet-uncertified 777Xs and 15 Airbus A350 jets, according to the manufacturers’ data. 

Airbus discontinued the A380 in 2019 after failing to find takers for the twin-deck, four engine aircraft as airlines opted for smaller and nimbler twin-engine jets capable of operating multiple frequencies a day.