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An Emirates Airlines plane is parked at Dubai World Central airport (KARIM SAHIB/AFP/Getty Images)
An Emirates Airlines plane is parked at Dubai World Central airport (KARIM SAHIB/AFP/Getty Images)

The dogfight over Canadian skies Add to ...

For Emirates Airline, all routes lead to Dubai. The strategically located aviation hub is the centrepiece of the carrier's ambitious expansion strategy to tap economic growth in India, China and the Middle East.

For its competitors, the renegade carrier and its grand plans have the potential to change global air traffic patterns, disrupting a fragile industry that's already under pressure from rising fuel prices.

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Emirates' game plan - funnelling travellers through Dubai instead of Europe, and on larger and larger planes - has worked wonders so far. The state-owned carrier has managed to not only survive but thrive as an independent carrier, declining to join one of the three major airline alliances in the world - Star, SkyTeam and Oneworld. When it launched in 1985, Emirates flew only to Pakistan and had just two planes. Now, it flies to more than 110 destinations in 66 countries and has some 150 wide-body jets, including 15 Airbus A380 double-decker planes and 85 Boeing 777s. Emirates has become the world's sixth-largest airline for international passenger traffic.

Emirates' success reflects the emergence of a new world economic order, one in which other Gulf carriers such as Abu Dhabi-based Etihad Airways and Doha-based Qatar Airways are also rapidly expanding, said Robert Kokonis, president of airline consulting firm AirTrav Inc. "The balance of economic power is shifting away from North America and Europe," said Mr. Kokonis, who depicts Emirates as a trailblazer seeking to take advantage of Dubai's location in the thick of global air traffic routes.

But an array of nervous rivals warn the carrier is trying to muscle in on territory long held - and amply served - by the old-guard "legacy airlines."

Air Canada and Germany's Lufthansa, partners in the Star Alliance of global airlines, are pitted against the Dubai-based carrier for transatlantic traffic. They view Emirates, owned by the Dubai government, as a clear and present danger to their lucrative international flights.

Seeking to protect their Frankfurt hub, the two partners allege that Emirates receives subsidies from the Dubai government in the form of cheap landing fees at Dubai International Airport, an accusation that Emirates hotly disputes.

The airline's transition from tiny regional carrier to global player has happened quickly. During its first two decades, Emirates easily won approval for landing slots from foreign governments because it was too small to be considered a threat by other carriers.

That started to change last year, after Emirates sharply increased its orders for new Airbus A380s and Boeing 777s - planes that are larger and more fuel-efficient than the Airbus A330s and A340s in its fleet. More than 190 aircraft are on order, including about 75 Airbus A380 double-decker planes, which seat almost 500 passengers, and nearly 50 Boeing 777s, which have room for about 400 travellers. In 2015, the 350-seat Airbus A350 will be introduced into the Emirates fleet.

Alarmed by Emirates' steady stream of new plane orders, some of the world's leading carriers - including Lufthansa, British Airways, Air France/KLM and Australia's Qantas - have publicly criticized its expansion strategy. Air Canada, for one, warned that Emirates is unfairly seeking to siphon off international traffic, and accused its rival of trying to dump seats into the Canadian market. "Few Canadians actually travel to Dubai as a destination and fewer still residents of Dubai travel to Canada," Air Canada chief executive officer Calin Rovinescu said in a speech last fall. Others critics pointed out that the A380 jumbo jets have been designated for Toronto, Vancouver and Calgary, alleging Emirates wants to pick and choose among the top Canadian destinations, hammering at the heart of Air Canada.

Last fall, the Canadian government denied additional landing rights beyond the three already held by Emirates, a decision that the Harper government has stood by, despite heavy political pressure from the United Arab Emirates. Germany is still deciding whether to acquiesce to Lufthansa's lobbying and turn down Emirates' requests for more German landing rights.

Andrew Parker, senior vice-president of international affairs at Emirates, bristles at what he terms "Lufthansa propaganda." He said Emirates prides itself on having a young fleet of planes, and will retire about 100 jets, including older models of the Boeing 777, within the next decade as it takes delivery of new ones.

As for comparisons between Canada and Germany, Mr. Parker said they're overblown because the Gulf carrier already has access to 49 landing slots in Germany, compared with just three in Canada. A recovery in European carriers' revenue last year and "substantial aircraft orders from every region should counter the pessimism and cries for protection from some carriers, and confirm it is not just Emirates that believes long-term investment underpins profitability and growth," he said.

After Ottawa refused demands by Emirates and Etihad Airways for new landing rights at Toronto's Pearson International Airport in October, the UAE responded by ousting Canadian soldiers in November from Camp Mirage, a staging base near Dubai that had been used for nine years to supply the Afghanistan war. In December, the UAE imposed visa fees of up to $1,000 on Canadian visitors, further escalating tensions between Canada and the Arab country.

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