Etihad Airways to invest $7 billion by 2030, CEO says

Abu Dhabi airline plans to use part of the funds to retrofit its older Boeing 777 wide-body planes, Antonoaldo Neves tells Global Aerospace Summit

Etihad Airways' shareholder ADQ will decide on airline's IPO, chief executive Antonoaldo Neves said on Wednesday at the Global Aerospace Summit in Abu Dhabi. Victor Besa / The National

Etihad Airways plans to spend more than $7 billion by 2030 to refurbish its older Boeing 777 planes, buy new aircraft and update its products as part of a plan to double its size, its chief executive has said.

The airline will start a programme to retrofit its older 777 wide-bodies starting from 2026, as there is currently a two to three years-long wait to get new aircraft, Antonoaldo Neves told the Global Aerospace Summit in Abu Dhabi on Wednesday. Etihad has a fleet of nine Boeing 777 passenger aircraft, according to its website.

“We're going to be investing $7 billion in the next five years and the beauty of this is that we're going to be investing with our own cash flow generation, so we don't need any capital from outside to do that investment,” he said.

Asked about plans for a potential initial public listing, Mr Neves said that “no decision” has been made yet and that any decision will be made by its shareholder ADQ, Abu Dhabi-based investment and holding company.

However, the airline's management is “working hard” to ensure the airline is ready if ADQ decides to list the company's shares, he added. This entails a strong business plan, profit margins, great customer service and governance framework.

"It's really important for airlines to be listed because in the end, although we don't need cash in the next five to six years to deploy the $7 billion capital, one day if we decide to accelerate and to grow even more, we may need capital. And having the ability to tap into different sources of capital to finance our growth may be important in the future," Mr Neves said.

Etihad Airways is on track for its third consecutive year of annual profit after it posted a 48 per cent increase in its first-half net income on the back of strong travel demand fuelled by a strategic network expansion and increased flight frequencies.

Profit after tax grew to Dh851 million ($232 million) from January to June, up from Dh575 million in the same time last year, the airline said last month.

In the first eight months of the year, the airline carried 12 million passengers, up from 8.9 million in the same period of 2023, according to its latest data. Load factor, a measure of how well an airline fills available seats, stood at 86 per cent during the period.

So far this month, Etihad Airways' load factor on some days is at between 90 per cent to 92 per cent and its "planes are very, very, very full", Mr Neves said.

New routes

The airline's investment is aimed at doubling its size by 2030, which includes doubling its fleet to 170 planes and tripling passenger numbers to 33 million by the end of the decade.

"We're going to be launching about eight to 10 new destinations every year," Mr Neves said on Wednesday.

The airline has launched 11 new destinations so far this year, most recently to Bali in June.

In September, Etihad Airways announced new routes to Prague and Warsaw that will start in the summer of 2025.

"In November, we're going to be announcing more destinations. So there are about 40 to 50 new destinations to be announced over the next five years. So that's about eight to 10 new destinations per year," Mr Neves said.

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Lie-flat business class seats

The airline is bringing back five of its Airbus A380 double-deckers into service following a grounding during the Covid-19 pandemic, and next year will introduce new A320 narrow-bodies with lie-flat seats in business class, Mr Neves said.

"In the narrow-body fleets, we're going to have a consistent product with lie-flat business class seats in 80 to 90 per cent of the planes," Mr Neves said.

The airline is also investing in upgrading its wide-body fleet of Boeing 777 aircraft. "Given the constraints that we have in the global aviation market, there are no planes available, if you want to buy a plane it's going to take two to three years to get the plane," he said.

"So we had to take the decision to bring back some 777s whose interiors are a little bit dated ... we're going to be retrofitting all those planes. And the retrofit starts in 2026. It looks far but it takes two years to get one brand new seat from the manufacturers."

With all of the changes, "I'd say by 2026 and 2027, you can expect a totally different airline", he added.