INTERVIEW: Dubai Airports CEO Paul Griffiths
Home to the Middle East’s biggest airline and responsible for around 51 million passengers per annum, it is fair to say that Dubai International Airport (DXB) is one of the emirate’s greatest achievements. Opened in 1959 with just a single, short runway and small terminal, it has grown to become the world’s fourth busiest airport in terms of international passenger traffic, with three terminals, two concourses and two runways each measuring more than 4000 metres long. Today, it is regarded the region’s central aviation hub, and is planning on expanding further as Dubai looks towards receiving more tourists.
With this in mind, Dubai Airports chief executive officer Paul Griffiths thinks it is only a matter of time before DXB overtakes Hong Kong, the third busiest airport in the world for international passenger traffic. The Asian hub handled some 53.9 million travellers in 2011, recording just a 5.9 percent increase on 2010. “With our growth this year, which will take us to 56.5 million [passengers], about eleven percent growth, I think we will be hot on the heels of Hong Kong; we may even overtake them,” says the former managing director of London’s Gatwick. “We may end up being the third-largest airport in the world in terms of international passengers.”
The ultimate aim is for Dubai to top the leader board, beating both the current number-one, London Heathrow, which handled 68 million passengers in 2011, and the emirate’s other main rival, Paris Charles de Gaulle, which recorded more than 60 million travellers for the year. By 2018, the target is for Dubai to reach 90 million passengers by expanding the existing facilities to cater for an increasing number of planes and flights. According to Griffiths, the plan includes renovating Terminal 2 and building Concourses 3 and 4. “During 2013, Concourse 3, which is taking shape, will boost our capacity to 75 million, and beyond that we’ve got a whole programme of capacity enhancements contained in a document called SP2020 which we published last July,” said Griffiths, referring to the company’s US$7.8 billion strategic expansion plan. “That document really contains our growth potential for the next eight years, which would get us to a point where we have really got to number one.”
Concourse 3, which was allocated a construction budget of $3 billion when the decision was made to expand the airport, will occupy an area of 528,000 square metres with 22 gates and a capacity of 19 million passengers. It will be part of the Terminal 3 complex, and provide first and business class lounges, bars and restaurants, in addition to four and five star hotel rooms and an 11,000 square metre shopping area. Griffiths says the concourse has been designed exclusively for Emirates, with 20 gates built especially to handle Airbus A380s. It will be similar to Concourse 2 in terms of appearance, and will be connected to the two major public levels of Concourse 2 and Terminal 3 via an automated people mover. “Concourse 3 is in the final stages of construction,” he says. “We’ve probably got another nine months before an operational handover can take place. [So it will be] the first quarter of 2013. It will be quite a significant upgrade from what you saw when we opened Concourse 2 in 2008. Of the new gates, eighteen are double height air bridges, so you can board from the top level and the bottom level.”
Around the same time will be the opening of Terminal 2, he adds, which is being expanded on the north side of the airfield to accommodate the growth of low-cost carrier flydubai. Griffiths says the new terminal will open in April. The remainder of the expansion is obviously dominated by plans for Concourse 4, which is due to be constructed on the south side of the airfield in the cargo village area. The additional concourse, which is in the last stages of the initial design concept, is due to be completed around 2015-2016, and will significantly increase the capacity of the airport. “We’ve agreed a concept, method of operation and general layout. We’ll be going into detail once those specifications have been finalised and then obviously the project will go out to tender,” says Griffiths. “[For completion], 2015-2016 is what we’re targeting. The idea is that it will cater for all the non-Emirates international airlines, giving us about eighteen additional gates. This will allow Concourse 1, which is attached to Terminal 1, to be used exclusively by Emirates. It’s about half and half at the moment.” He adds that the senior management are also eyeing some difference in design features with the new concourse. “We are looking at having quite a high quality terminal, with some interesting design features. We’re trying to get some solar incorporated in the design. The aim is to try and get some accreditation which would be the first for Dubai. We’re linking it to Terminal 1 with an APM.”
But the big question of course is how all of these expansion plans fit in with wider aims to build the $34 billion Al Maktoum International Airport in the Dubai World Central logistics complex near Jebel Ali. As Dubai’s major, long-term airport project, the Al Maktoum International facility was originally meant to replace DXB as the Middle East’s major aviation hub, and scheduled to become the world’s largest airport by the time it opened. However, strangled by cashflow problems, the development was slowed in the wake of the global financial crisis, which halted a number of big-ticket projects as government agencies around the emirate struggled to pay trade creditors. This, along with all the enhancements planned for Dubai International, has caused onlookers to question the company’s long-term intentions for the site.
“The original [plan] was to have some capacity online for 2017; we’ve pushed that back by about ten years... something around . We’re changing the timeline and order we bring the facilities online so that there’s more generated cash from this airfield... and a longer timeline to invest. Both of those things will make the cashflow support that we require for the development [of Al Maktoum] much more manageable,” Griffiths clarifies. “The economics have changed enormously in the last four years and obviously we have had to adapt. We [also] realised that during the construction period, if we didn’t have any capacity growth at Dubai International, the opportunity we would be losing to other airports of growing passenger traffic would be significant. [Ultimately] the idea is to build a facility that’s large enough so that Emirates and other airlines could move, not necessarily at the same time, but within a fairly short timeframe. Emirates relies on having a very tight and efficient connecting operation here at DXB, so you can’t spread that across the distant hubs, it’s got to be in the same place. Emirates is growing so quickly and such a large airline already that to move that to the new airport you’ve got to have enough capacity to take the entire operation.”
By the middle of the next decade, the aim is thus to have a capacity for 80 million passengers at the new site, allowing Emirates to move its entire operation there, Griffiths says. In the meantime, the focus will be on increasing cargo operations and moving towards its first commercial passenger flight. On the cargo side, Griffiths says the Al Maktoum International airport has so far done well, signing up 22 airlines since its opening in 2010 and carrying about 9500 tonnes of cargo in the first six months of operation. Today, the airport regularly exceeds 10,000 tonnes of cargo a month. “It’s growing enormously,” Griffiths says. I think we did about 12,000 tonnes in January, and we’ve just announced that Saudi Airlines Cargo has come into Dubai World Central. Some of the major cargo airlines are taking DWC very seriously as a cargo and logistics hub.”
In a bid to aid growth, the firm recently announced plans to develop more terminals, of a similar size to the existing shed which can handle around 250,000 tonnes of cargo per year. There are a total of twelve plots available, with only one in use currently. “The good thing about Dubai World Central is that we’ve got plenty of space to build additional facilities. We’re looking at developing another two plots, this will give us [a capacity of about] 750,000 tonnes.”
Also taking off soon will be the first passenger flight, expected at some point this year. “We have a passenger terminal building at the moment there which we are readying for operation during the course of 2012, but that’s only got a capacity of around 7 million passengers, so it’s nowhere near adequate for the Emirates operation. “The aim is that as soon as we’ve got business for it and it’s ready for use we will open it.” When asked if the firm has had any interest from carriers, Griffiths says it has, but is still waiting for an affirmative decision. “We’ve had a number of discussions with different airlines about potential operations, but passenger airlines tend to plan their operations quite late, so it’s quite likely we’ll be announcing quite late what the plans are for the passenger operation. It’s much more difficult [to establish a hub for passengers] because a lot of passengers are sensitive to connection opportunities.”
For the time being, the passenger terminal is best suited to a small, narrow-body, regional or low-cost operation, which doesn’t have a huge dependency on connections, he says, adding that with some passenger traffic, investors are likely to be attracted to the area. “The idea is to develop a whole city around the airport, an ‘aerotropolis’ but that really needs to be supported by the level of activity. Once the growth gets established, people will want to invest.”
Asked about the possibility of a link between the two airports, which could potentially increase the attractiveness of the new airport to regional carriers, Griffiths says it is unlikely. “There was some discussion about providing a dedicated metro line between the two airports but I’ve never really understood the rationale behind that, because why would you need a fast rail link between two airports if your connecting hub is either here or there? There are plans in the longer term for the RTA to have a more extensive network throughout Dubai, which would include Dubai World Central, [but]... there doesn’t seem to be a business case to invest in a mass transit system [now].”
Going back to DXB, the designated hub for at least the next decade, Griffiths says the focus is on automation within the airport, and also congestion reduction when it comes to flights — an issue which has long been raised by the media as a key problem for DXB. On the subject of more efficient processes, he says the aim is to cut back on expenses and the need for new staff, in the hopes of boosting revenues and cashflow. Immediate plans include the introduction of devices such as automatic boarding pass scanners in passport-control areas, which will reduce wait times for passengers. In some areas, such as security checking, new technology will also help increase visibility in the airport whilst reducing the need for invasion of privacy. “[The see-through technology] is actually old now, we’re not using it and most airports are going away from the idea of images. The same technology is being used but the indications as to whether you have something on your person are now being digitally reported.”
As for congestion, Griffiths plays down the existing problems highlighted by the media, but makes clear the company’s intentions to come up with a plan. “First of all there is a very limited problem,” he says. “Of course holding delays are undesirable both from a passenger perspective and a fuel consumption perspective, but they are unfortunately part of life at most busy airports around the world. Dubai has largely escaped them up to now, and at the moment they are of a very limited impact to a small number of people.” He adds however, that as the traffic density increases and the number of aircraft movements rise, there will clearly need to be a plan for air traffic management. “Our challenge is to get our airspace development plan into decent shape and agreed and adopted by all parties so we can improve the situation dramatically. We’ve got that plan, it’s all articulated, the projects have been allocated timelines, we know what’s involved, it’s just a case of getting everyone round the table. We’re working on the programme, but we don’t know how quickly we can implement. That’s going to depend on the amount of agreement and how quickly that can be reached.”
And, despite the issues, Griffiths continues to see growth in air traffic as a positive development for DXB, both in highlighting Dubai’s attractiveness as a tourism hub and in demonstrating the success of the airport. With 150 airlines currently, and around 20 new carriers coming to the airport every year, it certainly seems unlikely that congestion is acting as a deterrent.