Sir Tim Clark's strategic leadership at Emirates

I'm Jon Ostrower, Editor-in-Chief of the Air Current. I'm Brian Summers. I write The Airline Observer. You're listening to The Air Show, the podcast where we talk about what goes on in the business of the sky. Jon and I are back from New York where we interviewed aviation royalty. Emirates President Sir Tim Clark, and while wearing tuxedos, Jon and I gleaned some tidbits on the state of the global aviation industry at the annual Wings Club Gala. I think there were three main topics, first, spirit and the real possibility that it may liquidate. Second, some grumbling about the A321XLR from planners who say that airplane cannot fly as far as Airbus promised. And third, well, engines. And I felt like we couldn't walk three feet without some aviation luminary complaining about either engine reliability or their onerous engine maintenance contract. It doesn't seem to be getting any better out there, as one person put it to both of us. In what other industry does a manufacturer sell you something that doesn't work as promised and then charge you more to fix it? Yeah, it was a really lovely evening and much hand wringing about engines, of course. Really some great feedback on a piece that we had in the air current that we published just the week before. Effectively, airlines find themselves in that customer satisfying combination of having a product that is not as good as before and also more expensive. We'll dive into the nuances of the engine business in an episode real soon. Well, that's good. I think people want the gossip today. I know many of our listeners, they want to know if we spoke to Karsten Spore. We did not, although John, you and I got about 15 feet away from him and we discussed whether we should introduce ourselves again. And then we decided against it maybe next year. But we did interview Sir Tim Clark, who built Emirates from nothing into a big deal over the last 40 years. He gets a lot of accolades. But not everyone in this industry likes him, something that Clark alluded to in his speech when he won the Lifetime Achievement Award at the Wings Club Gala. But I guess when you disrupt an entire industry, you do make some enemies. Yes. He has and continues to have a remarkable career. We were happy to sit down for an interview with Sir Tim Clark before the event. And we're excited to share it as today's episode. We talked about engine reliability and Boeing and why the A380 fizzled, as you'll hear. But I started by asking him about the very early days at Emirates and how his career there began. And I'm sure you'll understand that the first time we went to the Emirates, we were in the, I think, the first time we went to the Emirates. And we were in the Emirates. And we were in the Emirates. And we were in the Emirates. And we were in the Emirates. And we were in the Emirates. And we were in the Emirates. And we were in the Emirates. And we were in the Emirates. And we were in the Emirates. So with a bit between my teeth, I said, right, let's go for the long haul. And do it now. And, but to do this, we have to do certain things, which is what we did. Whether it be the defining the, the operating model. That had to be done fairly carefully. And then how we're going to execute the operating model. And we followed that. And, you know, we went from that and scaled on the basis of that original model, which has worked so well for a, for so long now, 40 years. Sure, Tim, I want to follow up on that question a little bit. And we will ask you nuts and bolts questions soon about things like engines and airframes. But in addition to building an airline, the transportation company, you also built a brand that people know and a lot of people love. Now here in the United States, I would say that at this point, we have three premium airlines. One of them will let the listeners figure out which one that is doesn't seem to really believe in the idea of brand building. And yet you're putting the Emirates name on lots of things in the world. There's going to be an NBA tournament pretty soon. I just read a report that you're spending maybe 30 million euros a year on AC Milan sponsorship to put the name on the jerseys. When did you realize that you weren't just selling transportation, but you were selling an idea of travel? And how can you even evaluate whether all this advertising and marketing budget is worth it? Okay, going back to the point I made earlier about the facets of the operating model, the business plan, whatever you like to call it. Part of that was to punch above our weight. By the time we had 10 aircraft by the very late 80s, people began to think that we were much bigger than we were. That was one of the facets of it. It was a tool of expansion. We didn't go out to make a global brand because at that stage we weren't. But what the marketing aspect of our business model was and became was not lost in us in the early days. So creating a service delivery, a product in flight, and for me, when I was looking at all of that, what was I looking at? Mediocrity. Much of that is still there today. As many of the many carriers you've talked about suddenly realize that they've got away with it for too long as they commoditize their business and forgot actually what people and humans require and what they want to do. And as the world became wealthier, whether you like it or not, the propensity to afford higher airfares was not lost on us. But at the time we wanted to take, as you rightly said earlier, we were coming from a relatively small, very unknown city with an airline that had absolutely no prospects in the eyes of a few to go anywhere. Many of the people that we were not say up against, but were working in the region with thought we'd never make it. So in that business model, you will see, we're still in my desk at work, the need to extend our brand, create a brand, so that we can reach well beyond the network that we were designing before we actually got there. That was a clear plan that we knew was expensive. We looked at the marketing budget of Singapore Airlines, for instance, in the mid-80s. And they were spending about two to four percent of their income on marketing, where most carriers were spending about half a percent. It was always the first one to become a casualty of recession or whatever. We looked at that and said, if we're going to do this properly, we've got to be up there with SQ. A model not dissimilar to our small nations, geographically not as well positioned as we are, with a very small domestic population. But they punched above their weight. They brought a lot of very big part of the Singapore government's outreach and putting Singapore on the map. The government by wasn't minded to do that. But certainly for people like me, we're realizing that if we were going to do this, certain things had to be the USP, the differentiator between others that we competed with in a miniscule manner, because we were up against them. Pan Am was still flying, BAA was flying. And a lot of the state carriers, which have now privatized Lufthansa, Air France, etc., didn't happen until the late 90s, were fairly dominant in their own way. But we could see the weakness of the networks. We could see the way people were traveling and wanted to travel and couldn't. And we could see what we would have to do to break the mold, if you see. And getting back to your question about brand, to make people look at us, to think about us, to be aware of us, we had to do more than just sit on our hands and hope they was going to come to us. So we really had to be out there. We knew what we were doing and where we wanted to go, when we wanted to do it, with the tools that we were convincing the manufacturers to buy. These had to be very special aeroplanes, equipped and designed internally by us, not by them. So all the design work that we did was with a view to that original operating model. We have to separate ourselves from the herd. We have to separate ourselves from the herd of mediocrity. If you look back in the '80s, the type of aircraft that was flying in those days, DC-10s, 747s, Tristars, you name it, they had Caravelle still flying. They had Mercure still flying. They had all sorts of hotspots and some of the old British aircraft, the VC-10, et cetera, were still flying. When I looked at that ragtag bobtail compendium of product, '50s, '60s, '70s design and execution, I knew that if we could get our friends in the manufacturing business to build an aeroplane, or rather take the existing aeroplanes and leave the internal side to us, don't get involved. And that was part and parcel of trying to-- and we couldn't achieve the status that we did with our brand reach without coming up with the goods. The aspirations that we created had to be met. The expectations had to be met. So it was systemic. It had to be all orchestrated very carefully, coming at the right time, doing the right thing, and getting the sweet spot absolutely right. There's a lot to talk about there, but I wanted to get your sense of what was the first aircraft that you feel like Emirates really was able to put its mark on, either a Boeing or Airbus, in terms of either performance or cabin or some facet of the airplane that you feel like you were able to steer. Well, the 777, in his early days, we were one of the launch customers. We were looking at something to replace the 600Rs and the 310s. We had managed to persuade Airbus to shift a few things around. We had done a lot of cabin work, et cetera. But they weren't at that stage really ready to do as much as we wanted. This is interesting, though, until the 34500 came along. And we were very, very keen on our operating model, going back to what I said back in the mid-80s, was an airline that could reach 16, 17-hour missions without stopping. And everybody thought, certainly, they thought I was barking mad, because who would fly an airplane for 16 hours? They must be mad. People want to get off and walk around, et cetera. I said, "Think on. Think like that. That's really good." But actually, if you can design a cabin which allows people to do all sorts of things, given the distances they have to travel, you have to start thinking very carefully about seat design in all classes. You have to think about the cabin itself, the interior architecture, the lighting, the air flows, where you position. I remember ripping out all the ducting and everything in the cabin of the Airbus line. So I dropped the ceiling and said, "Take all that out and push it to the sides." And people said, "Well, why would we do that? The engineers won't let us." I said, "Mark my words. I need the crown. I need the crown for height. And there's nothing to stop you moving your ducts, your MEPs, we'd call it, and building, and all your conduits to the side of the aircraft, and all the other bits and pieces." That gave me a lot more space to do things that I wanted to, as you know. The first class suite appeared on the 345-hundred, the area I was working on in 1998. Pity I didn't take a patent on that, especially with the doors, because everybody's putting doors in first in business history. If I had a patent on every door that's being produced, I wouldn't be here talking to you. But anyway, Boeing were already a little bit ahead of Airbus on that. So when I saw the go-on-the-mock-up of the 777 said, "Bingo, bingo, this is it, but your crown needs to come out." I need to, and they said, "Here we go again, right?" So we started with them, and started redesigning the cabin as well. So, getting back to it, it was probably Airbus, Boeing in the first instance, but Airbus, as we got bigger, and we started buying large numbers of aeroplanes. I won't talk about the 380 until later. They realized that we were, one, very serious about what we needed to do, two, that a lot of the work that we were doing with regard to the requirements of the aircraft and the way we were doing things like cabins could cross-pollinate their product portfolio. As I said, my fingerprints seem to be just about everywhere now, because I see some of the work we did in the early '90s, 2000s, now in their order book. Fair enough, that's good for the industries, good for everybody, frankly. Now, the manufacturers, both the OEMs, the airframe manufacturers and the seat manufacturers, here he comes again. What is he going to say now? Sorry. But we were very, very persistent, and every time they accommodated what we needed, we bought large numbers of them. As a result of that, as our brand strengthened and our profitabilities were getting more and more and more much to the chagrin of so many of our competitors, that they started to reluctantly follow the lead. And they started to do so. So the work we did in the '90s with regard to seat design, primarily in the economy, Cameron, I'm doing another load of work which I'm doing on a new seat for economy, which will watch how that will be picked up. It cross-pollinated the whole industry. Everybody benefited from it. And you see some of the designs. Remember working with Lars Anderson on the 777? I said, "Lars, I need bigger windows." He said, "You can't have bigger windows. We've got to-- Lars, I've got to have bigger windows. Make bigger windows, OK?" So they made bigger windows. I said, "Lars, he's not flying where he needs." "Oh, right, we'll put winglets on it." Whatever, you know, all the bits and pieces. But it was great fun, I have to say. Personally, it was just wonderful to go around and be somebody who could actually, if they listened to you and they trusted you. And importantly, if your order book came along behind them, so you said, "If you do this, we'll buy 50 ship sets of seats." Thank you very much. But that was all part of the original business plan. We've got to use the strength of the business, as you get stronger, to transform the way people thought about designing and building and the primary-- well, the customer was actually going to be faced with and enjoy or not. You have had tremendous success with the 380 as the, obviously, the largest operator with, you know, we've had more than 115 flying right now. I want to help our listeners understand why the 380 works for Emirates and how you deploy it at really both a granular tactical level but also the bigger strategic vision for Dubai. Once we'd tested by the mid-90s, when the 777 came to us, and latterly the 345, and for the Archer on Range mission, we knew it worked. If it was working as well as it was, the sweet spot that I talked about, going after markets were ignored, going after connectivity, going after route networks which were straight-line and very simple much, much shorter than going from Accra to Beijing over Paris or London or Frankfurt, whatever, with long stops, long waits between flights, get there, one stop, et cetera. So the whole notion of creating a hub and eventually a super hub became non-linear because once we reached our critical mass, which was probably achieved in about the second half of the last decade, we knew that plugging in more and more and more of bigger and bigger aircraft and then connected them to multiple destinations, banked in the same time period as that, we knew that we would be able to feed any of these at any time in our scheduled banks. Just open the doors and if I can get a hundred destinations feeding my banks in the cross-flow and you take five or ten or fifteen, you run out of seats very quickly. That's exactly where we are today. So we have, as we layer on, more and more and more, the 380 becomes the heavy lifter. It was the 380 and the numbers we bought and the building of this super hub, which is a true international super hub, I do not believe there is one in the world, apart from what our friends in Gata are trying to do as well, which is basically emulate the kind of thing. Because it works and the more you do, the greater the ability to bring your economics to the margin and then beyond that, it's really easy running. So the scalability of that model is unstoppable, think about that. It's a model that outperformed all the other models that you might see in London, Frankfurt, Paris, Sydney, New York, Los Angeles, the primary, your big three over here, well outperformed all of those, as you can see by our results, they've just gone nuclear, frankly. And that's because we have that wonderful machine at 15 hours a day, we fly those things. And that's Herculean for an aircraft of that size, given the moving parts and trying to maintain it. Sir Tim, my expertise on this podcast and otherwise tends to be the commercial aspect of the business. John usually handles everything that's maintenance-related, airframe engines. But I have this problem right now. I know a problem is big in the airline industry when the commercial people complain about it to me. And all I hear about right now is I hate my engines, I pay too much for engine costs and maintenance. This has to get fixed. And again, that's a weird thing for me to hear as somebody who covers that part of the industry. How bad is this situation with engine makers and then how do you fix it? Interesting that you said the commercial people are asking that because that means they're not perhaps concentrating what they should be concentrating. It's for the engineers. Well, they want their airplanes. That's right. The C-suite needs to really take care of that kind of thing. Now, the engine issue, yes, we have quite a serious issue. Quite why this has happened. People say COVID and supply chain, et cetera, et cetera. But there was evidence of plot loss before COVID. There was evidence of quality control. There was evidence of mis-design in many respects. There was evidence of chasing technology for the sake of it in the hope that they would get fuel reduction, specific fuel on the engine. Sacrificing too much, forgetting that fuel consumption is very important to all of us. We know that. But for me, if I've got 140 departures in four hours, all of them, why bodies? I need reliability as much as I need and some cases more than fuel economy. I'd rather have a 99.5 dispatch reliability. So what was happening was that the beginnings of this flakiness was starting to appear before COVID. COVID didn't help. But I said I've had enough of people telling me about supply chain because it's five years since COVID, over five years since COVID started. And we should be on that now. But there are issues with, we know about RTX on the single aisle. We know the 320s lying around and 737s which have problems with those engines. Airbus have got lots of whitetails sitting around. Well, not whitetails. They're all spoken for, but no engines on them. Our friends in Rolls-N-Gey are behind the game with regard to the spares they need to keep our engines on wing. This isn't about new engines. It's about existing engines being unmaintainable because the spares aren't there. So this is where your commercial people will say, if an airline is compromised in his ability to meet its production targets because propulsion isn't up for it, they're going to mown, yes. Because they can't sell the inventory. And it's not lost on the people that had GE, had Rolls or whatever. How to solve it? For me, you know, I look back at the huge amount of M&A that went on in the 90s and the 2000s. In the belief that they could consolidate, take Saffron for instance, they could go from engine manufacturing, CFM and all that kind of thing, right the way through galleys and seats and toilets and variable frequency generators and APUs and gear and all that kind of thing. And what did it look like on paper when you looked at this unconsolidated aerospace industry? Many of which were okay, but it's a question of how they were managed. Many of them were small, some were medium-sized. I honestly believed that unless they were consolidating to the greater whole good, then they would not survive. And that's anathema to my thinking. Certainly if anybody says to me that the airline wouldn't survive because we were too small, think again and watch and learn because there's a storm coming. But these people were subsumed into these highly, heavily consolidated industries. To be quite honest, I don't think the governance of those industries in the multifaceted nature of what they do is what it should be. And they need to divest and they have to reconsolidate on a smaller entity to increase their capability of reaching the kind of targets that we need in our business. You know, I'm being fairly vocal in the industry with regard to the ability of the OEMs and the supply chain to get their act together. There's no excuses. We've got to say there are no excuses anymore. It's no good telling me it's okay Tim, we're on it, we're looking at it like a proverbial mirror. I need you to do it and get it done because I have to get this done, I've got a job to do. I need you, if I could get rid of all of you and do it myself, I would, I promise you. Already I'm starting, manufacturing in Dubai because some of the stuff that we need primarily in cabin and all the other bits and pieces. Then some of the avionics are some of the component parts of the airframe we're doing ourselves now, upgrading our engine overhaul capability big time. I don't care what it costs, we will do that because we've got a new fleet coming in and I can't rely on the OEMs to actually do what they should be doing until there is clear evidence of that in place. John then asked Clark about Boeing. We'll be right back with his revealing answer after the break. Hey guys, Do-Hop. Okay, I'm hopping. Now what? You know Do-Hop, the company that makes it easy for airlines to sell, service and deliver seamless connected journeys for travelers, airlines and OTAs. Yeah, I know Do-Hop, but aren't they just a meta-search site like Kayak or Google Flights? Oh no, there's so much more than that now. Do-Hop powers booking systems for airlines that want to expand their offerings. Think about flight connections by EasyJet or Transavia Smart Connect. Okay, but why does EasyJet need a meta-search site? It can sell its own flights without any help, you'd hope. If not, things are way worse than I thought there. This is far from just a meta-search site. This is about building connectivity beyond their own networks. Through Do-Hop, EasyJet can actually sell you a ticket to Prague from LA. You'll just fly north Atlantic to Gatwick and then connect to EasyJet two hours later. How does that even work? These airlines don't even have an interline agreement. Two hours, I have to reclaim my bags, check in again and all that. Seems like a huge risk in hassle. This is where Do-Hop works its magic. With Connecture, Do-Hop can guarantee to get travelers to their final destination just as it would be required on a single ticket interline. And with the upcoming Bag Connect, it can even transfer the checked bags for you. The traveler just pays once to buy this ticket via a Do-Hop-powered site and all as well. This is amazing. Does it work everywhere? Can I finally connect from Frontier to Aeroflot? Um, no. Not everywhere. But the reach is broad and growing all the time. There are 20 airlines that are live, but more than 100 in the partner ecosystem. And it's not just airlines. They even power multimodal partnerships like Air France and SBB, the Swiss Rail system. This sounds good, but why is it better than a traditional interline agreement? This is super simple and very flexible. Do-Hop can roll out a solution in weeks, and they have plug-and-play integrations that require almost no IT help. Apparently, Hawaiian Airlines holds the record. It was 18 hours from them reaching out to the system going live. And they can work with NDC offers and orders too. Whoa, that's incredible. If I worked at an airline, I'd be interested. To learn more about Do-Hop and what it can do for your airline, go to Do-Hop.com. And we're back. As promised, here's what I asked your Tim Clark last week about Boeing. I want to ask about Boeing. I remember an interview that you and I did back in, it was March of 2021, actually. So it was still solid COVID. This is pre-vaccines. People were not back at it at that point. And we were talking about the state of Boeing. And I'm going to quote you to you, if that's okay. You said, quote, "The wake-up call of the max was something that told them that all was not right. If you think that you're going to get away with it by making cosmetic changes, and they will write me as they did, we've done all this, this, this, this, and this, you're not getting it. You're not getting it." Four and a half years later, are they getting it? They got it as far as the max was concerned. And we know the history of the last four years. It hasn't been a nice one. As they've unraveled and done all the bits of deep dives that they've wanted to do, or rather they've been forced to do, and every layer has caused consternation and surprise as they've gone down right the way through it. So again, this is a well-documented thing, John. What I saw at the time was a reflection of the way I'd observed Boeing go through the '90s. And the thing that, of course, worried me was, as I probably told you, was the way the 777 was hijacked from the normal run-of-the-mill operations in a very, very sophisticated aircraft with new airframe technology, new composites, new propulsion, new electoral systems, and new aerodynamics. And to do what they did, which was part out many of that to other suppliers on the 787, who had never built anything like that before. They kept the wing, thank God, but everything else was going all over the show. And this was in the belief that they would save money. And I believe that was the beginnings of the evidence that the strength of bound sheet was beginning to transcend anything and everything. My view, of course, as you know, is if you hit the sweet spot in your operating model, the financial metrics take care of themselves. Don't come along and say, "I need to double my EBITOM." Well, how and why would you want to do that if you haven't hit the sweet spot? It's very simple, but they went down that path. So now we have a Boeing which is chastened, mortified by what happened under many layers of new management. Hopefully, the Kelly and Stephanie have lasted longer than their predecessors, of course. They are asking the right questions, which is important to us. They're doing as far as we can see what they should be doing. The whole world was turned on its head as a result of what happened. And so the way the company interacts with the agencies that are external to Boeing, whether it be the FAA, whether it be Congress, whether it be the media or whatever, has caused them to, I think, knock themselves down, deconstruct and reconstruct. I've always said you lost your workforce. I'm a great believer in workforce. And if you lose your workforce, they'll lose you. And they lost the workforce when they took the 787 abroad. Immediately, there was industrial labor issues. Well, if you treat your labor badly, they're not going to be very friendly towards you. And so you get this thing, people laid off, brainwashed on again, et cetera, et cetera. For me, there's no way. If you're doing the right thing, you're producing aircraft that people want, and you're innovating and providing new aircraft that people want. Your workforce is content and steady. You never have to lay anybody off. You're going to deal with the peaks and troughs in the airline business. It's endemic in what we do. But you're smarter about how you go about that. Technology has taken care of a lot of that. So there's another thing that commercial people will tell me at other airlines. Except for your airline, they don't like the A380. And I mean, they really don't like the A380. Ben Smith at Air France KLM was the first thing he did was get rid of it. There are other airlines that tell me privately it just doesn't work for them. The unit costs aren't that good to begin with. And if you don't fill it, God help us. A lot of these airlines only have 10 to 15 aircraft. I know you've done it well at Dubai. Did other airlines mess up in the way that they used that airplane? How come it didn't work? How come it didn't catch on beyond your airline? If you look at the way, answer the first question, which was Ben Smith grounds his Air France. Ask what Gattel said. Remember Akbar? Worst mistake I've ever made. Never going to fly ground them. Tony Douglas, Singapore Airlines, Qantas, Carsten, Lufthansa. What did they say about it? They're going to fly again. Now they're all going flat out, full up. Remember what I said about the tidal wave post COVID, which nobody would believe. But it happened so quickly that they had to activate and actually it has a renewed lease of life, which is why I'm on the mission to try and persuade either side to build a bigger airplane, something else. Why didn't it actually work for them? Because they bought too few of them. Secondly, if you look at the way they designed the interior of the airplane, and I've not been disingenuous to some of the people who came with the Air France 380 which resembled a DC-10 inside, or some of the other European carriers who came up with it. BA bought more and they're using them smartly today and I believe they're all full. I can't believe they're losing money on that given the yields that we've got and fuel price at the level it is. That airplane is really singing because of the yields that they were all getting and the fuel as it is. But it's such an efficient aeroplane and this is what people don't get. Partly because we have so many of them, they have so few of them. But one of the problems that Ben had with his fleet was that trying to feed them into the banks at 7, 8, 9 o'clock in the morning in Charles Seagal was almost impossible. He didn't have the gates to it. His terminals weren't capable of handling that number of people. When you've got that number of 380s feeding him, we could have 5380s on the ground at one point in time. The airport facilities are going to be able to take it above wing and below wing and shift that business within our 15 minimum connecting time. If you're not geared to that and it clutters up your whole scheduling program rather rid them because you've only got 15, it's not difficult. But if you've got 121 that we had, we now got 116, you can't just say, well, we've got to ground them. But importantly, post COVID, it came into its own and this is the paradox of the argument with regard to the useful lives and why they don't work for so many carriers. I think we design the interior as well. They are still the most sought out after aircraft that we know not only in our fleet, but in the world today. People go out of their way to take convoluted routes to fly on the 380 rather than go on smaller aircraft with multiple stops or whatever. So why didn't they make it work? They bought too few of them. They didn't really know how to do it, how to employ them. The American carriers won't have anything to do with it anyway because in those days it was the weapon in the armory of Emirates. So you need to stop using them because that allows them to go to Airbus to build more and more and more if we buy them. So none of them bought the airplane. Why wouldn't they? You're serious about that. Do you think the U.S. airlines were trying to dissuade other carriers from buying the airplane? In the time of the what I call the Rift, there was a clear mandate. The Star Group do not buy the 380 because it gives immense power to them. If we don't buy it, eventually its demise will come about and in truth that's what happened. If the U.S. carries, who could say to me you couldn't fly from Los Angeles to Tokyo with the 380, whether United, American or Delta, and not make money? I don't think so. Really. Or go from Los Angeles to Sydney and given the legs that we, you know, I remember Tom Williams who was director of programs at the A380 in the early days. He said to him, this airplane was never meant to go more than 13 hours. How come you've got it flying to Auckland which is 17 hours? I said magic. Magic. We stripped out a lot of things from the airplane, took weight out, etc. He said, this is amazing. You mean you can carry 460 passengers from Auckland to Dubai. It's full going the other way. Yeah. He said, well, we never designed you to do that. I think that was a loss on a lot of them. And you need to look at their own personal circumstances. Many of these carriers were in severe financial difficulties at the time. The notion that you would buy a list price in those days, $450 million airplane, was anathema to their boards. If you look at the 208, 209 financial crisis, what happened then? If you look at the 98, 98 financial crisis, 203, the Gulf Wars, etc., etc. There was a great deal of nervousness, fragility in the governance models of the entities that we competed against, which frankly, the more I heard about it, keep it going. Because as long as they lose their nerve, lose the plot, gives us the ability to move. So last December, you introduced your A350. And it was delayed a bit on top of everything. I'm really curious your reflections on the introduction of the airplane. How was it working out for you? But also relative to what you learned between 2008 and introducing your last all-new aircraft type, the 380 and the 350, and how you are thinking about those lessons for introducing 777X, which obviously is a common type rating. But how is the 350 working out for you right now? The 350 is actually a really good airplane, like the Dreamliner is. How you manufacture it is your problem. Remember that they designed brilliant airplanes, both sides of the Atlantic. I've never got any complaints about that. We never have airplanes that have got high levels of drag. We don't have rogue airplanes coming with 7%, 8% differentials on their performance, whatever. Now we get them really, really good. That's 8/7, as I've always said, is one of the best they've designed. That wing is to die for. The mass that went into getting that right should be in Harvard, MIT, as a textbook of how to deal with aerodynamics in the 21st century. But it's production that gives them the problem. The whole business I talked about earlier, the way the supply chain was feeding them, the way the quality gate into plant was being dealt with, and the quality out of gate onto the completed airframe, which popped up as it has done many times on the 350. Not one has been on time. And they've rescheduled because they can't get the supply chain in line. And we still get silliness in the way the aircraft is performing at flight tests just before delivery to us. And it shocks and stuns them in fairness. And every time I've got a contracted delivery date, we've then, sorry, we've had to push it two weeks, push it three weeks, push it, it goes on and on and on. Earlier in this podcast, you teased us a little bit. You spoke about something that airline executives rarely speak about. You actually talked about economy class. Usually when I hear about economy class, people just say it's kind of a low margin thing that you have on the airplane. It's all premium, premium, premium. Are you really going to rethink what's in economy class? And can you give us a little bit more about what you're planning for rethinking? What I'm saying is for the same reason that we went back into the seat manufacturing business in the 90s, early 90s. And I think we did a very good job in the redesign with the manufacturers of what those seats. Those seats are still there today. The difference is that the seat for our ultra long major missions has got to be more comfortable. We've never gone back to that. The premium is going through burning hoops every 10 minutes and everybody's on the premium game. Okay, we've never gone away from it. Others have trashed first class. They said there's no first class demand. It's so bad and they've taken a long time to improve the business class seats. You rightly say economy is left. Don't forget 75%, 70% of our passenger loads are economy. Without doing too much, we can make their lives a lot more comfortable, particularly on the long haul, without too much weight gain, without too much to expect. You've just got to be thinking slightly out of the box, which I've been doing with some of the manufacturers more recently. And you've seen people like Air New Zealand do their kind of three-seat thing, but that's not what I mean. It's actually the seat itself. It could be much more comfortable. It could be, I won't say what I'm going to do with it, but... No, we'd like to know. But now we can't because as soon as I do, everybody listening to this and all the others will say, "What's he up to now?" Because in the end, watch and see and when it comes out, then you'll be able to, "We're not going to patent it." It's for the good of all, really. Just say we can actually, although the manufacturer might choose to do that, you may think, "I'm not too bothered about that." If you have to make money from patents, then you shouldn't be in the airline business. But the seat needs attention. We can do a lot better. Why technology is helping us? The understanding of the human body with regard to the economics of long haul flight, we know a lot more about then than we did then. So, the things like wraparound sound, much better TV systems with Starlink bringing in wonderful things. You can do all sorts of things with screen sizes on, seats that are adapted for that. So, if you rethink the whole, all the moving parts of a seat and economy, you can actually do a lot better than you're doing today. It's just that nobody's really got around to think about it because our friends over here, it's a commodity. You commoditize your inventory. After all, the airline community has really got some very good yields now, much higher than it had prior to COVID. We have the affordability to make their lives better and share some of the loot, put it back, invest it into the fleet. It takes me back to brand. Your first question. This is all part of the brand growth. The trust in what you do, the value for money that you provide, the range of products that you provide, the interest, the fun of flying on ultra-long range missions. I've never lost sight of economy, never will, because it is so important to what we do. And if you provide a better deal for them without doing too much, the trick about this redesign is that hopefully it is smart enough to make sure that you don't face huge amounts of weight gain and cost. If you get that right, you've hit the sweet spot. The world spends a lot of time talking about your airplanes, your product, passenger experience. 20% of your income comes from cargo. And it's not, I think, a well-understood or appreciated part of the business, integral part of the business. Phenoma, phenomenally important. During COVID, it was the lifeblood of what kept this industry going. Obviously, we had a significant contraction in sea traffic in the Red Sea, because of Hootie rebels, ships being attacked, and the role of air cargo picking up for making sure that goods got to market. How do you see that part of your business progressing relative to global instability, but also whether it's U.S. or Chinese overwatch of the seas, and your own role in providing that lift that flies over all of that? Yeah, we will look... You've got to hunt for this business. You've got to know where the business is really. Don't worry about the politics of it all. Business moves one way or the other. And you've got to know where it's going to be. You mentioned the Hooties, of course. Well, in the short window of opportunity that provided, we cleaned up freighters. But of course, once the just-in-time inventory is adjusted to an extra two weeks of going around the Cape of Good Hope, albeit a little bit more expensive, they do it. You get that disequilibrium going into equilibrium. So your loads start to fall off a little bit as the supply chain adjusts to that. And of course, there was a glut of shipping. Remember, there are a lot of vessels doing nothing. As soon as you introduce two weeks of extra shipping time, that glut gets taken up fairly quickly, whether it be crew tankerage or just the bulk carriers or whatever. All these affect, and in our business since we've been in Emirates, this is ebbed and flowed for all sorts of reasons. We talk about geopolitical, whatever it may be, insurrections, wars. We've had a lot of those recently, you know, complete shutdowns, shipping, et cetera, et cetera. We're halving to it. We'll find a way. They expect us to do that. Our brand is strong enough. People believe that if it's going to be away, Emirates will find it. Stay with them. Give them the business. They'll carry it for you. And we've done that ever since. It's always been one of that business model. Tenants was we want cargo to be a significant contributor of income and eventually profitability to the bottom line. So we developed, we worked on, we're now probably the largest. If you look at with what we've got and the belly hole capacity, we have largest cargo carrier in the world. So, and if we ignored it, that would be really silly when you're going into China, you're going to Africa, you're going to South America is a bit of an ask. Because it's such a long haul and you can't really carry that much. But Africa is ready to rock and roll. We haven't touched the surface of that yet. We'll see. Nick M. Nevis who recorded our interview with Sir Tim Clark in New York City. Our theme music is by Joshua Mosier. Thanks for listening and we'll be back soon.