◼ BUSINESS Bloomberg Businessweek December 23, 201920
DATA: COMPANY WEBSITEdirector at aviation advisory firm JLS Consulting in
London. Most airlines have key routes that form
the backbone of their business travel: There’s
Melbourne to Sydney, Bombay to Delhi, Frankfurt
to Berlin. What sets apart Emirates’ Dubai-to-Riyadh
flight are the extremes of the operation, from the
giant planes to the price fluctuations in a narrow
time frame and the demand for business- and first-
class seats, which sell out long before coach.
Offering alcohol at beach clubs, bars, and restau-
rants, where men and women can freely mingle,
Dubai has become a big draw for expats who enjoy
the trappings of low taxes and warm weather year-
round. In no small part, the sprawling metropolis,
with its skyscrapers, amusement parks, and artificial
islands, was built and is supported by migrant labor-
ers from poor countries such as Bangladesh or India.
But recent years have been hard on Dubai.
Property prices are down about a third since 2014,
while tourism, a pillar of the economy, is struggling
to grow. In 2018 the economy expanded only 1.9%,
its weakest pace in almost a decade. This has forced
more residents to seek work elsewhere. And some
foreigners who moved to Dubai for high-paying
jobs find themselves still living there but traveling
to Saudi Arabia on a weekly basis. One of the com-
muters, who asked to remain anonymous, says he’d
never consider moving to Saudi Arabia because,
even as the country loosens its lifestyle restrictions,
it remains a world apart from Dubai.
Yet what looks like a virtuous business cycle—
Saudi Arabia gets expertise diversifying its econ-
omy away from oil, Emirates reaps a windfall on
the flights, and consultants get to enjoy Dubai’s life-
style on weekends—is coming under scrutiny from
Saudi Arabia’s rulers. With authorities keen to build
a skilled domestic workforce, the wandering con-
sultants are increasingly a thorn in the kingdom’s
side. In September, Saudi Arabia issued a royal
order calling on government officials to hire for-
eign advisers only when in dire need. That could
have a big impact, since Saudi Arabia accounted for
almost half of the $3.3 billion of revenue generated
by the regional consulting market this year, accord-
ing to a study by Source Global Research.
The decree left some wiggle room on what con-
stitutes necessary consulting work and who’s con-
sidered a foreigner, given that the big firms all have
local entities registered in Saudi Arabia. It’s clear
that Mohammed bin Salman, the crown prince,
wants to open Saudi Arabia to more global business
and make the capital a corporate hub by easing
social constraints. More local women are now test-
ing the limits of a restrictive dress code, and Western
pop music and movies have become more readilyTHEBOTTOMLINE Almosthalfofspendingonconsultantsin
the Gulf occurs in Saudi Arabia. Emirates has a lucrative shuttle for
those workers between Riyadh and fun-loving Dubai.available.“Wedoseea greaterwillingnessforcon-
sultantstomovetoSaudi,”saysMichaelStubbs,who
worksatrecruitingfirmCooperFitch.“Withsucha
significantamountoftheconsultancyworkbeing
basedthere,weseemorepeoplelookingata full-
timemovewiththeirfamiliesinsteadofspending
fourdaysa weekawayfromthem.”
Emirateswantstokeeponeofitsmostlucrative
routesintact,particularlywhenit’sfocusingmore
onservingthelocalandregionalmarket.Shorter
flightsarebecominga biggersliceofitsbusiness
asit reconfiguresitsnetworkandfleetprofileafter
reachingthelimitsofglobalgrowth.Witha strong
businessfocus,theregionalnetworkis amongthe
company’smostprofitable,measuredbypriceper
ticketanddistanceflown,withRiyadhfarmore
lucrativethana flighttoNewYorkonEmirates.
ThelocalfocusisreflectedinEmirates’fleet,
whichpreviouslyhadconsistedonlyofmassive
AirbusA380sandBoeing777s.Thecarrierhas
begunorderingsmalleraircraft,allowingformore
short-rangetripsandmoreflights.Andcooperation
betweenEmiratesandlow-costspecialistFlyDubai
hasgivenit morefirepowertoservethelocalmar-
ketatdifferentrates.
Forcommutingconsultants,however,budgetis
rarelya concern,asreflectedinthestratospheric
farestheiremployersarewillingtoshelloutat
the beginning and end of each week. Even if some
choose to move to avoid the back-and-forth, the
lure of Dubai is unlikely to subside soon, nor is the
appeal of Riyadh as a place to do business. “Dubai-
Riyadh is important because it’s a route linking two
major financial centers,” says Henry Harteveldt, an
adviser at Atmosphere Research. “Lots of business
travel, and highly profitable.” �Layan OdehWhy Emirates Loves Its Riyadh Hop
Average economy ticket cost per mile● Typical price of a
round-trip economy
ticket for the two-hour
hop during prime time$1,089
DubaiLondonNewYorkRiyadhSydney$1.1223¢
20¢20¢