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Business Traveller

Airline Ambitions Among Arab States: Three Cities In A Race To Create the Biggest Hub In The Gulf Region

Aired October 14, 2006 - 09:30   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

ROSEMARY CHURCH, CNN INT'L. ANCHOR: In the headlines this hour, the United States says it has found signs of radioactivity near the site where North Korea claimed to have carried a nuclear test. More analysis is being done on the preliminary findings. If they're confirmed it would be the first verification that North Korea is indeed an nuclear nation.
At the United Nations Security Council members will be in closed-door meetings today to try to come to a consensus on the final wording of a resolution that would impose sanctions on North Korea. Vote on those possible sanctions could come later in the day.

The U.N. General Assembly has elected Ban Ki-moon as the next U.N. secretary-general. He'll replace Kofi Annan on January 1st. Ban currently South Korean's foreign minister is the first U.N. leader from an Asian nation since 1971.

A clarification from Britain's ranking general of remarks that touched off a storm of controversy over the war in Iraq. General Richard Dannatt told a London newspaper that British forces should leave Iraq soon, suggesting their presence is taking the security -- making it worse. He says his comments were taken out of context and that he favors a gradual withdrawal.

A coroner in England says there is overwhelming evidence British journalist Terry Lloyd was unlawfully killed by American forces at the start of the war in Iraq. The ITN correspondent was killed when U.S. Marines fired on a minivan taking him and other wounded people to a hospital. The U.S. military disagrees with the coroner's findings.

A Peruvian court has sentenced Shining Path founder Abimael Guzman and his long-time lover and second in command, Elena Iparraguirre to life in prison. A former philosophy professor Guzman said he was a revolutionary combatant, not a terrorist. In the 1980s and `90s, the Maoist insurgency carried out bombings, assassinations and massacres that claimed thousands of lives and generated a brutal state reaction.

And those are the headlines. Stay tuned now for BUSINESS TRAVELLER. That's coming up next. I'm Rosemary Church at the CNN Center (INAUDIBLE).

RICHARD QUEST, CNN INT'L. ANCHOR, BUSINESS TRAVELLER: Economic growth and the fastest aviation market in the world, we're in the Middle Eastern Gulf on this month's CNN BUSINESS TRAVELER.

(Voice over): Coming up, so many airlines, and soon, so many airports. But where are all the passengers? Aviation ambition in the Gulf.

Laying the ground work for new routes: Airports give airlines a pace-y pitch at the annual route conference.

And from tailfins to tail feathers: I try my hand at falconry, as I escape to the Arabian Desert.

(INTRO MUSIC)

QUEST (on camera): Hello, and welcome to CNN BUSINESS TRAVELLER. I'm Richard Quest.

This month reporting from the Gulf and the Middle East. All around me are the sights and the sounds, the dust of construction, because if you want to see real money being spent on airlines and aviation projects, well this is the place to be.

For instance, here in Doha, where they're building a new terminal -- in fact, a new airport.

(BEGIN VIDEOTAPE)

(Voice over): Less than a million people live in Qatar, yet it is expanding its airport capacity to 50 million by 2015; 300 kilometers east is the capitol of the United Arab Emirates.

(On camera): In Abu Dhabi, the home of Etihad Airways, there is no construction yet, but they've got big plans. They're going to extend the existing terminal. And yes, eventually build a new airport.

(Voice over): And just over 100 kilometers down the road there is another emirate, with impressive ambitions.

(On camera): In Dubai the work is well advanced, for instance, this new terminal. Overall Dubai is spending $10s of billions of upgrading the aviation infrastructure.

(Voice over): That's why we're in the Gulf. The shear growth of the aviation industry is outstanding. Let's begin in Dubai. One of the fastest growing cities in the world. The current Dubai airport is undergoing a $9 billion expansion. And here on the city's desert outskirts they're planning to build a brand new airport. It will be one of the world's biggest, called Dubai World Central.

This is the man who is making it all happen. Sheikh Ahmed bin Saeed Al Maidoum.

QUEST (on camera): So you haven't even finished the extension of the terminal and what's happening here?

SHEIKH AHMED BIN SAEED AL MAIDOUM, CHAIRMAN, EMIRATES GROUP: This is a continuation of the expansion. Another concourse will be built here.

QUEST: But why do you need it all? Why do you need this? And that? And the new airport?

MAIDOUM: We need it for all the air planes that we bought.

QUEST (voice over): There are a lot of them, 132 in all, including 43 Superjumbo A-380s. The most of any Airbus customer. The total bill comes to $30 billion.

The sheikh isn't the only one spending big on planes. Akbar al Baker, the chief executive of Qatar Airways is proud to show off the latest edition to his fleet. The A-340600, it's complete with lounges, of premium passengers.

And it's not only in midair Qatar is trying to win over the high- fliers paying more money.

(On camera): This is the new dedicated, premium passenger terminal in Doha. From later this year, all Qatar Airways first and business class passengers will come through this building, whether point to point, or in transit. The fact that so much money is being spent on facilities like this is a good indication of the growth in premium passenger traffic in this part of the world.

(Voice over): And there's more. Four kilometers to the east, work has started on a totally new airport.

(On camera): What are you going to do with your old new terminal when the new airport opens?

AKBAR AL BAKER, CEO, QATAR AIRWAYS: Well, we'll knock it down.

QUEST: I'm sorry?

BAKER: Yes, we will knock it down, because the entire (UNINTELLIGIBLE) is in the urban development plan. So as soon as we shift to the new airfield, to the airport, the entire current airfield will have commercial, residential --

QUEST: Hang on, hang on. You're spending $200 million, building a terminal, because you need it now?

BAKER: Yes.

QUEST: Which you'll knock down in two year's time?

BAKER: Yes, but it is not only that terminal. It is the entire airfield that we are expanding.

QUEST (voice over): So, within a decade the existing airport won't be here. And quite possibly neither will this one. Because in Abu Dhabi, authorities are still deciding whether to close the current terminal and airport when the new one opens in 2010. It's main customer is Etihad Airways, which started in 2003 and is growing like a garden weed.

GEERT BOVEN, VP COMMERCIAL, ETIHAD AIRWAYS: We are able with new -- let's say, long-distance aircraft, we are able to bring in a new dimension to connect, first of all, the Middle East directly, for example, to the United States, and at the same time we are ideally located in between the East and West.

QUEST (on camera): In Abu Dhabi, you sometimes wonder what's the point? For most of the day here the terminal is empty. And yet Etihad is determined to build it into a major international hub, when Emirates is just an hour and a half up the road.

(Voice over): Etihad is not only competing with Emirates and Qatar, there is also Gulf Air, further north in Bahrain. Four airlines, all pursuing plans to become the Gulf's premier carrier and the region's leading hub. Does it make sense?

BAKER: My country needs an airline. My country needs a tool for the economic development of it's people and the country. And we are growing, and so are others growing, which means that there is a potential, there is a market for us to grow.

QUEST (on camera): A last question, sir. We've just watched a Gulf plane take off over there. We've got Qatar Airways over here. We've got your planes over there, Emirates. Can the Gulf region support four carriers, all growing, allegedly subsidized?

BAKER: From our side we see that will be no problem, at all. But we have to go and market this place. Everybody should go and market their own destination, to attract more people to come.

QUEST (voice over): However ambitious their plans are for this region, you can't help to admire the optimism of the local aviation chiefs and their shear determination to make things happen.

Coming up on CNN BUSINESS TRAVELLER, a feast fit for kings, or maybe not? We'll meet the people who decide where we fly.

(COMMERCIAL BREAK)

QUEST (on camera): Welcome back to CNN BUSINESS TRAVELLER. Now you'd be forgiven for thinking that I'm attending an oil conference, or maybe an OPEC meeting, but I'm not. These are airline and airport executives, and they're not mostly Arabs, they're wearing national dress because we're here in Dubai, for the routes conference. This brings airline and airports together to discuss the potential for opening up new routes in the future.

These are the people who will be deciding where you and I fly in the months and years ahead.

QUEST (voice over): A gala dinner in the desert and a rare night of excess for these aviation execs. These men and women have the job of creating profits in an industry that is making multi-billion dollar losses. It is they who decide where airlines fly, and when.

Like the entertainment industry the survival of any airline depends on its ability to fill seats.

And this is where the work is done. This is the business end of routes. Two days of hectic meetings, all timed by the clock. Here airports are trying to convince airlines that their runway is the place to land the planes. And they have just 20 minutes to make their pitch.

UNIDENTIFIED FEMALE: Hi, I'm Callie from Gold Coast Airport, in Australia.

UNIDENTIFIED MALE: Our airport is the most exciting development happening right now in Europe.

UNIDENTIFIED FEMALE: You need to fly to Orlando International Airport. We're state of the art.

UNIDENTIFIED FEMALE: We're very liberal, we have open skies.

UNIDENTIFIED MALE: We have the biggest catchment (ph) area in Poland.

UNIDENTIFIED MALE: That's why you should come to Don Quixote Airport.

QUEST: This is speed dating for the aviation world. Now, as for the airlines, what do they want out of this?

We asked the low-cost carrier, EasyJet. Not surprisingly, EasyJet is looking for a cheap date.

CATHERINE LYNN, EASYJET: It gives us a really low-cost way of meeting a heck of a lot of people. Our time and resources are limited and to come here and catch up with well over 200 airports is a great opportunity and quite a cost-effective way of us doing that.

QUEST: In the year `til (ph) September, events like this lead to the creation of more than 2,000 new routes worldwide. Overall, the busiest route is in Spain, where between Madrid and Barcelona more than 900 flights jet back and forth every week.

For me the most impressive part of routes, is that this conference truly does bring the industry together. There is a purpose. They come here knowing what they want and they know where they want to go.

(On camera): The advantage in building a new terminal is that everything is bang up to date, not only for passenger amenities but also things security, planning, and preparation. We've spoken a lot about security restrictions on this program. It is an ever-changing field. Let's update you on the latest position.

(Voice over): When you're flying from Europe to the U.S., every time you check the U.S. authorities receive personal information, such as credit card details and phone numbers, even your meal preference. It's called your PNR, the passenger name records. European governments have agreed to continue to provide this information to the Americans and have gone further allowing them to distribute the information to other U.S. enforcement agencies.

Michael Chertoff said the information could be shared with the Department of Justice, the FBI, and other agencies with counter-terrorism responsibilities. Sharing will be allowed, he said, for the investigation, analysis, and prevention of terrorism and related crimes. The EU made it clear in its statement that it is an interim agreement that will be reviewed next July and that the sharing of information was conditional upon privacy protection.

FRANCO FRATTINI, EU JUSTICE COMMISSIONER: We accept disclosure of data to other agencies, provided that they have comparable standards of data protection.

QUEST: At the same time hand baggage restrictions have also been eased. Following the three-ounce rule in the U.S., the EU is allowing passengers to take 100-milliliter containers of liquid.

(On camera): This is the size of the bottle of liquids that you'll be able to take onboard aircraft, 100 milliliters. But you will be able to take several bottles, so once again, personal toiletries can go into your onboard baggage, providing they're in a clear plastic bag. That will make it easier when you go through security. Overall, it still raises the question, whether 100 milliliters of liquid is enough to build a bomb.

PROF. HANA MICHELS, IMPERIAL COLLEGE, LONDON: The shoe bomber Reid, who had the explosive material in his shoes, I believe he had over 100 grams of explosive in there. Well, if you can dissolve maybe only about five or eight, or 10, maybe 10 grams in a bottle of 100 milliliter, or three fluid ounces of liquid, then that is not really a great hazard.

QUEST (voice over): Along with this modicum of liquid, larger bags can be taken onboard. Giving passengers flying from the U.K. more packing power. The sizable increase from a bag no bigger than a laptop case, to one measuring 56 by 45 by 25 -- well, it means that larger wheelers are back onboard.

(on camera): Last month, in Bangkok, we showed you the special gates designed for the super-jumbo, the A-380, well, get used to the site. Here in Dubai, there are loads of them. Multiple level jetways, all designed for different entry on the aircraft. And for good reason, Emirates has bought more of the planes than anyone else. Let's countdown to the Superjumbo.

(Voice over): Back in July the new man at Airbus, the chief executive, Christian Streiff, played down the extent of the company's trouble.

CHRISTIAN STREIFF, FMR. CEO, AIRBUS: It's not an overall crisis. It's just a crisis with our customers for one plane, and one specific issue.

QUEST: Christian Streiff was wrong. The troubles were deeper and bigger than that. Three months after the brave words, and Christian Streiff, himself, has left. In comes the Co-Chief Executive of EADS, Louis Galworth (ph). The Franco-German company says the new management structure is simpler and leaner. And it had better well be, Airbus has estimated the losses on the 380 at $6 billion because of the delays. And the true scale was only revealed in October, along with a updated list of belated deliveries.

Singapore Airlines, which has proudly boasted first to fly the 380, won't receive that plane until October next year. Other customers will have to wait even longer. Thirteen A-380s will be delivered in 2008, followed by 25 in 2009. It's not until 2010 that the numbers become substantial, 45 planes in that year.

While no airlines have yet canceled orders, they haven't ruled it out. We'll bring you more next month, as CNN BUSINESS TRAVELLER continues the delayed countdown to the Superjumbo.

After the break, I take the fast lane down the nearest dune and escape to the Arabian Desert.

(COMMERCIAL BREAK)

QUEST: Welcome back to CNN BUSINESS TRAVELLER. Where I have exchanged the high-rises of Dubai for the high sand dunes of the Arabian Desert.

Time to answer your questions in, "Now You Know". Stavros Meides wrote to us wanting to know: "Which are the airlines that offer the best leg room for those of us over six foot tall?"

Well, obviously, most carriers have good leg room in international business class. So, here's the low down on the leg room in economy.

The general rule is the longer the flight the better the legroom, even in economy. Charter carriers are amongst the meanest. And low-cost carriers aren't far behind. EasyJet, in Europe, gives just 29 inches of leg room. The normal range, though, is between 31 and 33 inches. Some, like Thai Airways, on their long-haul flights, give an inch or two more, up to 36 inches.

If you want more room than that, but can't pay business class prices. Then of course, there's premium economy. The price is more, but it does buy up to 42 inches of leg room. Virgin Atlantic offers the most in upper class, with more than 79 inches of personal space.

So Stavros, "Now You Know."

If you've got a question or query you want one of our experts to answer. Send us an e-mail: Quest@cnn.com. And remember to visit our web site, it is at CNN.com/businesstraveller.

After witnessing all that construction, the noise and the dust, and seeing the huge sums of money being spent, it is not surprising you need something to relax you. It's time to escape. And in this part of the world that means finding an oasis.

QUEST (voice over): One hour's drive away you can find just that. Here the only impressions of Dubai are footprints in the sand. The gazelles and oryxes roam freely, around the Omaha Conservation Reserve. They can probably be best viewed from the Bedouin inspired suites. Or better still, from the pool.

Dawn, and time to get close and personal with new friends.

GREG SIMKINS, CONSERVATION MANAGER: This is a Saka (ph) Falcon, which is one of the traditional birds that is used in Arabia for falconing. They've got a very specific weight that we fly them at. It's a food relationship. But if you have it too heavy, then the bird is not hungry and is not going to come back to you.

QUEST: Right. Time to see how this falcon flies.

(SIMKINS WHISTLES)

QUEST: Nope, not interested.

(SIMKINS WHISTLES)

SIMKINS: Come on.

(SIMKINS WHISTLES)

QUEST: And as we call it a day -- lift off!

SIMKINS: Hey!

QUEST: But the bird didn't come back. While Greg finds the bird, I've got other escapes on my mind.

This looks wickedly dangerous, but I'm told it's easy.

UNIDENTIFIED MALE: Bend down more, bend down more. Arms spread.

QUEST: Sand boarding may be slightly easier than snowboarding.

UNIDENTIFIED MALE: Very good.

QUEST (on camera): Ah, but every time you fall, be prepared for this.

Oh! Ooof! That really hurt. Too old for sandboarding. The falcon had the right idea. Eat too much and just sit and enjoy the view.

(Voice over): If you've been anywhere interesting. Send us a postcard: Quest@cnn.com.

(On camera): An escape in the Arabian Desert doesn't come cheap, but then nothing really does in this part of the world. And that is CNN BUSINESS TRAVELLER for this month. I'm Richard Quest in the Gulf States. Wherever your travels may take you, I hope it's profitable. And I'll see you next month.

END

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