Etihad’s Tony Douglas: ‘Don’t fight the storm’

{"text":[[{"start":12.52,"text":"After spending a year battling the biggest crisis his industry has faced, Tony Douglas has come to a simple conclusion: don’t obsess over things that are out of your control. "}],[{"start":21.67,"text":"“You know what? "},{"start":22.974,"text":"It is actually OK to have no idea exactly how this is going to pan out,” says the British chief executive of Etihad, Abu Dhabi’s national airline. "},{"start":31.142000000000003,"text":"“The trick to it is to be able to embrace ambiguity. ”"}],[{"start":34.910000000000004,"text":"A phlegmatic approach is useful given the state of the airline industry. "},{"start":38.889,"text":"The pandemic started off as a minor operational concern for global airlines as they suspended flights to mainland China in February last year, but it has since spiralled into a crisis that has parked half of the world’s passenger aircraft and is stretching into its second year. "}],[{"start":53.370000000000005,"text":"Douglas’s team meticulously charts predictions for the industry’s recovery from rival airlines, investment banks and consultancies, but has watched helplessly as these have all been undone by rising infection rates around the world. "}],[{"start":65.85000000000001,"text":"“Every time we have looked at this, on a monthly basis, it has continued to move to the right”, and get worse, he says. "}],[{"start":72.95,"text":"Airline bosses are now hoping that vaccines can offer a way out to lift border restrictions and encourage people back into the skies. "}],[{"start":80.2,"text":"Douglas, 58, was one of the first global business leaders to be vaccinated when he received his (the Chinese Sinopharm jab) in early January at Etihad’s in-house medical centre, a benefit of the nation’s rapid vaccination programme. "}],[{"start":94.38,"text":"While he waits for the rest of the world to catch up, Douglas presents a vision for crisis management that involves acting decisively over things you can directly influence, while trying to stay calm about those you cannot. "}],[{"start":105.64,"text":"One of his biggest decisions came early, when he grounded his entire fleet of 10 Airbus A380s: four engine “superjumbos” that are the largest passenger aircraft ever to have flown. "}],[{"start":116.2,"text":"It was a particularly difficult moment because the aircraft were the only ones kitted out with Etihad’s signature “Residence” suites, three bedroom cabins pitched as a superior offering to first-class flyers and priced at about $20,000 per flight. "}],[{"start":null,"text":"

"}],[{"start":129.92000000000002,"text":"Douglas does not expect his A380s to fly again, meaning his airline’s premium product will become one of the many victims of the aviation crisis. "},{"start":138.424,"text":"“It was a desperately saddening decision to make. "},{"start":141.092,"text":"We took a brave pill and we got on with it, we were bold and decisive,” he says. "}],[{"start":146.22000000000003,"text":"Airlines have long been cyclical businesses, with their fortunes tied to the global economy and geopolitics. "},{"start":152.36200000000002,"text":"But there was no industry playbook for how to deal with a crisis on the scale of coronavirus. "}],[{"start":158.14000000000001,"text":"Douglas suggests it is human nature to look back through previous experiences as a “mental handrail” to inform your decision-making processes, but ultimately this can be counterproductive when faced with a fast-moving and unpredictable situation, such as government travel restrictions, he says. "}],[{"start":173.98000000000002,"text":"“There is no benefit, I don’t believe, in trying to create unnecessary false certainty. "},{"start":179.15900000000002,"text":"The problem . . . is once you have nailed your colours to a particular mast, the inevitability is, it is going to change, and you will end up with more negative energy,” he says. "}],[{"start":188.96,"text":"It is a reassuring message, but the crisis has swept through Etihad’s business: the airline carried just 4.2m passengers in 2020, down 75 per cent on the previous year, and reported a loss of $1.7bn over the period, taking its losses over the past five years to more than $7bn. "}],[{"start":207.44,"text":"The airline is one of several state-owned Gulf “superconnector” airlines to have sprung up over the past 30 years. "},{"start":213.669,"text":"These use their owners’ deep pockets to connect points across the globe via their hub airports in the Middle East. "}],[{"start":220.16,"text":"Known for their luxurious cabins and focus on customer service, the airlines have helped to turn the Middle East into a global travel hub, but their rapid growth was checked first by political tensions and then the impact of the pandemic which has hit the long-haul market harder than regional and domestic routes. "}],[{"start":235.98,"text":"Etihad in particular has reined in its global ambitions, and Douglas was hired in late 2017 to oversee the carrier’s recovery from a failed expansion strategy. "}],[{"start":246.01,"text":"He joined the airline from the UK Ministry of Defence, where he had been in charge of managing the procurement of military hardware for the armed forces. "}],[{"start":254.01,"text":"Douglas was born in the market town of Ormskirk in north west England, 13 miles from Liverpool, and industrial heritage runs in his family: his father was a petrochemical and pharmaceutical export licence manager. "}],[{"start":265.82,"text":"He studied engineering, and went on to occupy leadership positions at former operator the British Airports Authority, where he managed the Terminal 5 project at Heathrow airport. "},{"start":275.424,"text":"He also held executive positions at construction company Laing O'Rourke and, in the UEA, at the state-run companies operating Abu Dhabi’s airport and port. "}],[{"start":284.82,"text":"Rivals have long complained that the Gulf airlines are effectively instruments of soft power, and are comparatively immune from market forces and shareholder scrutiny as they use their state-subsidies to win market share. "}],[{"start":296.84,"text":"Etihad was established by a royal decree in 2003, and Douglas briefly thanked Etihad’s owners for their support when outlining the carrier’s results this month. "},{"start":305.75699999999995,"text":"But in contrast to the forensic analysis faced by listed airlines, the company would not comment on how much money the state had pumped in during the crisis. "}],[{"start":314.59999999999997,"text":"Still, Douglas insists government ownership brings its own pressure. "},{"start":318.70399999999995,"text":"“I have been involved in Plcs, I have been involved in privately owned companies and I have been involved in government entities . . . by and large, I would say it is a score draw with all of them, because the only thing that changes is the direction from which scrutiny comes,” he says. "}],[{"start":332.81999999999994,"text":"The pandemic has refocused his efforts on right-sizing the airline — inevitably involving cutting costs and staff losses — and Douglas says that he is on track to restore profitability by 2023. "}],[{"start":344.0999999999999,"text":"But he will be the first to admit that events are not entirely in his control. "},{"start":348.1289999999999,"text":"His biggest challenge could be living up to his pledge to not let outside events rattle him as he leads his business through the crisis. "}],[{"start":355.0199999999999,"text":"“If you are out in deep water and the storm starts coming, it is going to push you in a certain direction. "},{"start":360.34899999999993,"text":"Don’t fight the storm, let it take you in the direction that the force of nature is going to take you in anyway, until the storm abates,” he says. "}],[{"start":367.5999999999999,"text":""}]],"url":"https://creatives.ftacademy.cn/album/001091878-1616460345.mp3"}