Face-to-Face: Akbar al Baker, Chief Executive Officer, Qatar Airways

1) Qatar has announced plans to expand in China. Can you expand on specific routes you envisage developing, and how important is China to your company plans?

Specific routes targeted for development are kept under wraps for commercial reasons so I don’t wish to elaborate on these at this time. However, were are seeking opportunities there.

In 2008, Qatar Airways launched its Guangzhou route, providing its fourth connection from China to the Middle East, Africa, Europe and North America. The airline also opened new offices in Beijing, Shanghai, Guangzhou and Chengdu, as well as establishing GSA services in Taipei.

The importance of the Chinese market cannot be underestimated, simply because of the sheer size - over 20% of the world’s population. The only other country close to China in population size is India, which happens to be Qatar Airways largest market. The airline currently serves nine key cities across India.

2) How key has Qatar’s, and in particular Doha’s, recent boom been to the growth of Qatar Airways?

Qatar Airways has both benefited from and been instrumental in the growth of Qatar as an emerging economy. Qatar Airways is effectively the brand ambassador for Qatar, taking the country’s name to over 80 key cities worldwide.

The airline provides a vital air corridor for business and trade partners of Qatar from these key cities.

Qatar’s population has doubled in size since 2004, with hundreds of thousands of people moving to the country to live and work. On top of this, Qatar Airways Cargo, a division of Qatar Airways Group has experienced massive increases, facilitating delivery of the bulk of air freight into the country. 
 
3) Middle Eastern airlines have not appeared to have suffered as greatly from the fuel prices hikes and global economic crisis. Can you expand on your company’s fuel hedging policy, and how the economic situation is affecting your operations?

Qatar Airways is currently renewing its fuel hedging contracts, which is coming at a favourable time given the current economic downturn. The airline was affected by the rising cost of fuel, though Qatar Airways has always been transparent when forced to pass on these costs to our passengers through our published fuel surcharge. We recently reduced fuel surcharges in line with the recent drops in oil prices.
Fuel hedging makes good economic sense in that it fixes the cost of a proportion of our total fuel needs for defined periods of time and, where possible, the airline is able to pass on any savings to its passengers, so the benefits are two-fold.

4) Qatar has a large order with Boeing, especially for 787s. How is delivery schedule progressing?

The Boeing strike has affected the delay of our 787s but it is too early to say what effect the 787 delay will have on the airline’s operations. We have already experienced delivery delays with Boeing 777-200LRs, which has seen our Houston route launch postponed by four months.

We have received a revised delivery schedule for 2009 from Boeing for deliveries of B777s that will see Qatar Airways receive eight new Boeing aircraft this year. However, Qatar Airways has extensive orders for Airbus aircraft as well as Boeing. The airline has a combined total of 200 aircraft on order worth around US$40 billion.

5) What do you believe the next 12 months will hold in store for Qatar Airways?

Qatar Airways is in a strong position to continue its rapid expansion of new routes and increased frequencies on existing routes. The airline will launch a direct air link between Doha and Houston on 30 March, offering a daily non-stop service between the two energy capitals.

Expansion plans to key cities are being evaluated and we will soon be announcing new route launches.

The US$500 million extensions at the current Doha International Airport main terminal and Premium Terminal will also be complete in the next few months that can cater for Qatar Airways continued expansion while the New Doha International Airport nears its scheduled 2011 opening date.