SWOT analysis of Etihad Airways (Etihad SWOT)
This detailed SWOT analysis of Etihad Airways aims to examine the strengths and the weakness of Etihad Airways. It also aims to explore the opportunities the airline should consider pursuing and the threats it should focus on.
Strengths of Etihad Airways
Etihad Airways is the second largest airline of the United Arab Emirates (UAE). It was founded in 2003 by Royal (Emiri) Decree. It is the national airline of the UAE and is wholly owned by the Government of Abu Dhabi (Etihad Airways, 2021).
Etihad has over 120 aircrafts which are from both Airbus and Boeing. The airline flies to over 100 passenger and cargo destinations in 55 countries. It has over 5000 cabin crew representing 110 different nationalities (Etihad Airways, 2021). In 2019, it carried 18.6 million passengers worldwide. It has ownership stakes in a number of partner airlines e.g. Jet Airways, Virgin Australia, Niki, Air Serbia and others (Zhang, 2017).
On-board services play a big role in the success of an airline. In this regard, it is worth mentioning that Etihad is well-known for its outstanding services. It has some great products and services such as Inflight Chef, Food & Beverage Managers and Flying Nannies.
Outstanding products and services have earned Etihad a number of awards over the years. For example, it was ranked 4th and 2nd in the World’s Best First Class Airlines 2019 and Best First Class Airline Seats 2019 respectively (Skytrax, 2021). It has also won the prestigious ‘World’s Leading Airline’ award by World Travel Awards (WTA) a number of times.
Weaknesses of Etihad Airways
Weakness is the second element to address in the SWOT analysis of Etihad Airways (Etihad SWOT). A major weakness of Etihad comes from some of its strategic moves. For instance, it purchased ownership stakes (inorganic growth) in a number of airlines to grow its route; however, this strategy caused it a huge financial loss. In 2016, the airline blamed $808 million of losses on financial exposure to partner airlines such as Air Berlin and Alitalia (Zhang, 2017). Unfortunately, the story did not end there. Both Air Berlin and Alitalia entered into administration causing Etihad a huge amount of financial loss.
Many economy passengers complain that Etihad focuses all of its attention on business class and first class passengers. Many people also complain that the waiting time in the case of connecting flights is longer compared to other competitors. These issues not only make some passengers unhappy but also invite unnecessary negative word of mouth.
Though Etihad expanded rapidly across the Middle East and further afield in its early days, it failed to maintain its momentum lately. Its reach has been reducing due to fierce competition and a backlash from airlines in Europe.
Opportunities for Etihad Airways
Etihad should look for organic and further growth opportunities in the Indian Sub-Continent and Asia. Organic growth usually refers to growth which is achieved through the development of internal resources (BPP, 2010). Etihad can also add depth to the network with increased frequencies on some of the key markets to Cairo, Dammam, Istanbul, Dublin, Dusseldorf, Calicut, Jeddah, Riyadh, Bangalore, Ahmedabad, Manila and others. In fact, some of the markets have already seen increased frequencies.
Threats to Etihad Airways
Threat is the last element in the SWOT analysis of Etihad Airways (Etihad SWOT). Etihad faces two big regional competitors i.e. Emirates Airline and Qatar Airways. Other competitors are British Airways, American Airlines, Air Canada to name but a few in different routes. Threats to the economy class of Etihad come from low cost carriers such as Fly Dubai, Air Arabia, and many others.
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Last update: 18 January 2021
BPP Learning Media (2010) Business Strategy, London: BPP Learning Media Ltd
Etihad Airways (2021) About Us, available at: http://www.etihad.com/en-gb/about-us/ (Accessed 15 January 2021)
Skytrax (2021) Best First Class Airlines 2019, available at: http://www.worldairlineawards.com/Awards/best_first_class_airlines.html (Accessed 16 January 2021)
Zhang, B. (2017) One of American, Delta, and United’s most feared rivals just suffered a major blow, available at: http://uk.businessinsider.com/etihad-airline-trouble-airberlin-bankrupt-2017-8 (Accessed 25 April 2018)
Author: M Rahman
M Rahman writes extensively online with an emphasis on business management, marketing, and tourism. He is a lecturer in Management and Marketing. He holds an MSc in Tourism & Hospitality from the University of Sunderland. Also, graduated from Leeds Metropolitan University with a BA in Business & Management Studies and completed a DTLLS (Diploma in Teaching in the Life-Long Learning Sector) from London South Bank University.