Page 263 - Aamir Rehman - Dubai & Co Global Strategies for Doing Business in the Gulf States-McGraw-Hill (2007)

Getting Things Done: Operations Strategy and the GCC 245

often sell out weeks in advance. Dubai’s central location also places
it within direct flying distance of major Asian and African cities
such as Beijing, Sydney, and Johannesburg, as well as all cities in
Europe.
As passenger volume in Dubai has steadily increased, invest-
ment in upgrading the airport and its facilities has grown as well.
Authorities are investing over $4 billion in expanding Dubai
2
International Airport and have established a “fuel farm” to sup-
port the needs of aircraft transiting in and out of the hub. This
enhancement has seen the airport’s fuel storage capacity swell to
nearly 450,000 barrels—enough to ensure that flights can take off
3
24 hours a day and be refueled around the clock. The fuel farm was
a far more modest investment—about $30 million—but a crucial
one in maintaining the airport’s global standing. In the longer term,
Dubai is planning a new Jebel Ali Airport 40 kilometers from the
current airport and the size of London Heathrow and Chicago
O’Hare combined. The airport will be able to accommodate an
astonishing 120 million passengers per year—30 times the popula-
tion of the UAE—making it far busier than Atlanta Hartsfield, cur-
rently the world’s busiest airport. 4
Dubai is not the only city investing heavily in its airport. Abu
Dhabi International Airport—whose passenger volume was 3.25
million (about one-eighth of Dubai’s) in 2004—is in the midst of an
ambitious $6.8 billion expansion, the first phase of which is
expected to be completed in 2010. The expanded airport will have
the capacity to serve 40 million passengers—a number equivalent
to the population of all the GCC countries. In addition to the pas-
senger facilities, the airport will have a cargo capacity of 2 million
tons per year—similar to the current volume at the UPS hub in
Louisville. Duty-free shopping in the airport is being heavily mar-
keted—in fact, Abu Dhabi Duty Free has repeatedly been recog-
nized with the Frontier Marketing Award for the “Best Marketing
5
Campaign by a Retailer.” The airport is being expanded largely to
support the growth ambitions of Etihad Airways, the UAE’s
national carrier launched in 2003 by Abu Dhabi.
Etihad Airways is itself a major infrastructure investment for
Abu Dhabi and the UAE. In 2004, the government-backed start-up
airline signed a memorandum of understanding with Airbus for 24
aircraft, including the new superjumbo A380 and the ultra-long-range