Helicopter Tourist Project

This assignment will report on the existing helicopter aviation tour and taxi service in UAE and in Dubai particularly. The work will identify the current trends in the sector and the current state of the market. The assignment will identify some of the main players in the market and the services that they offer. It will also look at the emergence of new players in the market such as Uber.  The assignment will discuss possible locations for helipads that would enable a company to cater for the needs of the wealthy in Dubai and in the UAE in general. The work will also discuss the possibility of a helicopter service between Dubai and Abu Dhabi and examine its feasibility.  It will conclude with a summary of the findings and the current opportunities in the sector.

UAE and Dubai Economy

The economy of the UAE is currently growing very fast. The main economic drivers are oil, service sector and tourism. The main tourist centre is Dubai and Abu Dhabi is more of a commercial centre. The UAE has a large foreign population and it is also visited by millions of people every year. Per the local authorities in Dubai, some 9.5 million people visited the city in 2015 (Dubai Tourism, 2016). Tourism is an important part of the economy in Dubai. In recent years, there has been a massive building program in the city and thus there are now many spectacular buildings and the urban landscape is widely regarded as one of the most magnificent in the world (Dubai Tourism, 2016). Dubai is a magnet for the world’s rich (Stephenson, 2014). This is especially the case with the rich from the Gulf Region. Almost one million Saudi Arabians visit the city every year and are vital for the tourist sector.

Dubai and the UAE and helicopter taxis.

The nature of Dubai and UAE means that the helicopter is a very popular mode of travel (Davidson, 2008). This is because many of the regions and global super rich either have homes in the city or are regular visitors. International research has shown that the main users of helicopters are the super-wealthy. They are often very willing to charter a helicopter if they do not own one. At present, there are six firms who dominate the sector in Dubai, they also provide services in Abu Dhabi. The market for these tours are usually expatriates living in the city or the many tourists that visit Dubai. These services are available 365 days a year although they are subject to weather conditions (Dubai Tourism, 2016). They are very important in the private helicopter industry in Dubai and in the UAE generally.  The many expatriates in the UAE are often frequent customers of helicopter hire companies. They are wealthy enough to hire the services of a helicopter taxi service (Abu Dhabi Aviation, 2016).

Dubai and the UAE helicopter aviation industry.

The helicopter sector in Dubai offers a range of tours and these include sightseeing tours. These tours range from 15 to 30 minutes in general and passengers are provided with commentary on the various sights in the city.  This is very like other major cities such as New York. However, in Dubai the helicopter tours are particularly popular this is because of the nature of the tourist industry in the city (Townsend, 2015). The clear majority of the tourists who visit Dubai and other locations in the Emirates are wealthy and they come to Dubai for a unique experience. They want to do something different and they have the means to pay for a helicopter tour of the city. Increasingly, tourists want a unique experience and the helicopter tour is increasingly popular. The helicopter tour is also popular because it is a quick and easy way to visit the city and to see its numerous sites. Many tourists prefer helicopter tours because of the heat and humidity which deters many from more traditional ways of sight-seeing. However, the market for the sector is still limited compared to traditional ways of seeing the city such as bus tours (Townsend, 2015).

The helicopters route usually involves the following sites. The Spice Souk, the historic wind towers, the skyscrapers of Buri Khalifa and the towers at Bur Dubai. Then the helicopter tours usually fly over Dieir and the spectacular dry docks and the world-famous beach at Jumeirah.  Nearly every helicopter tour will fly over the world this a series of man-made islands that are among the most famous sites in the world.

There is a lot of competition among the helicopter tour operators now and this has seen them diversify their offerings. No longer are they concerned with merely ferrying people over the spectacular urban landscape of Dubai. They are also offering a combination of services. They are entering partnerships with local tourist companies to expand the range of services that they offer. Increasingly, the helicopter tour operators are combing with local safari tour operators (Dubai Tourism, 2016). The tour operators fly tourists out into the desert where the tourists enjoy the sights and sounds of the deserts. The helicopter tour operators will then collect the tourists. Another increasingly popular venture is the combined helicopter and Dhow tour. In these, the helicopter operator will provide a sightseeing tour and then deliver them to a location where they will board a Dhow for a pleasure cruise.

One of the most important trends in the sector is the increasing availability of helicopter tours during peak periods in the tourist season. Dubai and the UAE have an all-round tourist season because of the exceptional climate. However, at certain periods of time there is a greater demand for helicopters. This is best seen in the Abu Dhabi Grand Prix where many tourists flock to the city to watch Formula One racing (Private Jet Charter, 2016). During this weekend of racing many wealthy and affluent people visit the city and they may wish to visit and see the attractions that Dubai must offer.  Many helicopter tour operators put on extra services during the Grand Prix to meet with the demand. The helicopter tourist sector is now increasingly flexible to the market. This is partly thus to the very many firms currently operating in the sector and that helicopter tours are still a ‘niche activity, in the tourist market (Townsend, 2015).

One of the features of the sector in Dubai and the UAE is that helicopter service providers are involved in both the tourist area and in providing taxi services. None of the companies are specialists in one area such as tourism. This is indicative of the highly competitive nature of the industry.  Another factor in the market is that there are many private owners of helicopters in the city. The super-rich who regularly throng the city’s five star hotels often own their own helicopters and this means that many rich clients are lost to the helicopter transport service sector (Townsend, 2015).

Helipads

The cities of Dubai and Abu Dhabi are very well provided for in the way of helipads. Because of the great wealth in both cities many private individuals own helipads. Then many local businesses have their own helipads for their clients (LivinginDubai, 2016). The many five-star hotels in the city of Dubai but also in Abu Dhabi have helipads for their own clients. There are also helipads at the Dubai festival City. However, if there were more helipads in the city of Dubai they would greatly facilitate the growth of the helicopter taxi service in the city and potentially even draw more wealthy visitors to the city. Among the locations in the city that may need a helipad are the Atlantis Hotel and ‘The World’. The Atlantis Hotel is one of the few major attractions in the city that does not have its own helipad. This is even though like many of the five star hotels in the area it attracts a wealthy cliental (LivinginDubai, 2016)..  There is an undoubted demand for those visiting the hotel for a helipad. Now many of those who stay in the hotel are long term residents and they often spend long periods of time in the hotel and it is their chief residence in the city. The Atlantis Hotel requires a helipad and this would also service the artificial archipelago known as Palm Jumeirah.  Here there are located many villas where wealthy visitors either rent accommodation or live (Davidson, 2008).   There is at present no helipad in the area. There may be great difficulties in constructing a helipad on this site as there is a high level of housing density on the Palm Jumeirah and the price of land may be very prohibitive. To overcome this problem- the authorities may have to add construct a helipad near the artificial archipelago. Then there needs to be another helipad in the area known as the World. This is a series of 300 manmade islands that represent the world, many of these islands have not yet been developed (Blanke and Chiesa, 2011).. There is at present no helipad in the area. There is the land available to be built one or even more helipads. If helipads were built on the island this would help their development (Dubai Economic Council, 2009). The exiting residents on the development are affluent and many are either local wealthy emirates or Saudis. They are the very group that would be most likely to seek the service of a helicopter taxi. The construction of a helipad would greatly improve the transportation network to the ‘World’. A regular taxi service could be established between the ‘world’ and the city of Dubai. The development is off the coast of Dubai and at some distance from the city. A regular helicopter service linking the world with the affluent residents of the ‘World’ would more than likely be successful.

The feasibility of a Helicopter Taxi Service Between Dubai and Abu Dhabi.

The two largest cities in the Emirates are both very wealthy and busy centres (Blanke and Chiesa, 2011). There is a great deal of travelling between the two cities. Many expatriates live in Abu Dhabi for work but they often travel to Dubai for recreation purposes. This is also the case with many local Emirates who live in Abu Dhabi and who also travel to Dubai for the weekend or holidays.  Then there are those who are living in Dubai and who need to travel to Abu Dhabi for business reasons. There are many who live in Dubai who need to travel to Abu Dhabi the commercial centre of the UAE. There is a great concentration of wealth in both cities and they are both visited by the super-region from the Gulf and beyond (Sharpley, 2008). Then there are the many celebrations, festivals and sporting events in the two cities. This would encourage people to travel between the two cities. For example, the Abu Dhabi Grand Prix wold be a major attraction for visitors and others (Sharpley, 2008).  On weekends when there are special events such as the Grand Prix there would be most definitely a demand for a regular helicopter taxi service.  Now such a regular taxi service would most likely appeal only to a certain segment of the population of those cities. Most the wealthy have their own helicopters, but there are many relatively affluent people, such as bankers etc.  who have substantial incomes but do not own a private helicopter. A regular helicopter taxi service between the two cities serve the needs of this class of people who are time poor buy have a high disposable income.

However, there are many factors that would suggest that such a service would not be needed. The communications network between the two cities. Travelling between the two cities is extremely cheap and relatively quick. The infrastructure in the Emirates is very impressive thanks to significant investment in the infrastructure of the country by successive governments.  Perhaps most relevant to this study is the air link that exists between Dubai and Abu Dhabi. This offer a range of services to the air traveller. There is a regular air service between Abu Dhabi and Dubai airports.

Based on the above it seems likely that there would be some demand for a helicopter taxi service between Dubai and Abu Dhabi. However, this is extremely limited because of the current and excellent communications between Dubai and Abu Dhabi. This means that it may not be feasible to develop a full-time and scheduled taxi service between Dubai and Abu Dashi. During special events and period of peak demand, such as the weekend, there already are private helicopter companies who are willing to take people to either Dubai or Abu Dhabi. Based on this it seems likely that there would not be enough of a demand for the service and during the periods when there was, there would be too many competitors.

What If Scenario

Uber enters the market

The American taxi hailing app has entered the helicopter tour market in 2015 and they offer a 20-minute tour in Dubai.  Uberchoper is an exclusive helicopter taxi service, it first began on the weekend of the Abu Dhabi Grand Prix and they have continued the service for the time being.  The entry of Uber into the market mean that the existing market is becoming even more competitive. However, Uber has made no long-term commitment to the expansion and for now (in 2016) it is only something of a pilot project. The impact of Uber in the market could revolutionize the market and it could promote the helicopter-taxi. Uber was drawn to the UAE but the great concentration of wealth in Abu Dhabi and Dubai. The entry of Uber into the market could revolutionize the market. If Uber commit to a full-time service and even expands that service, then the sector in its current form could be changed. Uber has huge resources and is a very well-known brand name. It could take a significant proportion of the existing market.  Uber would be able to potentially to dominate the helicopter transport service in Dubai and elsewhere in the UAE. The company could easily enter the helicopter sightseeing market and this would have a negative impact on the existing service providers. Uber is a huge company and because of ‘economies of scale’ it would be able to cut prices and potentially drive the other helicopter companies out of business. The potential entry of Uber would lead to a rationalisation of the market place.

Conclusion

At present, in both the tourist sector and the helicopter taxi sectors there are many companies who provide the services of their helicopters. Both Dubai and Abu Dhabi are well provided for by helicopter service providers.  There needs to be more helipads built in affluent areas such as The World to boost the sector further. A regular helicopter service between Abu Dhabi and Dubai is not feasible now, because of the existing excellent communications in the sector. Then the possible entry of Uber into the sector could lead to massive changes in the helicopter services area in Dubai and elsewhere in the Emirates.

Websites

Abu Dhabi Aviation (2016) Abu Dhabi aviation. Available at http://www.abudhabiaviation.com/ [Accessed 28 October, 2016}.

Livingindubai (2016) helicopter rides in Dubai. Available at http://www.livingindubai.org/helicopter-ride-in-dubai/ [Accessed 22 October, 2015].

Private Jet Charter (2016) Helicopter hire. Available at http://www.privatejetcharter.ae/helicopter-charter [Accessed 23 October, 2016]

Townsend, Susan (2015). Uber launches 20-minute helicopter tours across Dubai Available at   Uber http://www.arabianbusiness.com/uber-launches-20-minute-helicopter-tours-across-dubai-615839.html [Accessed 22 October, 2016].

Statistics/Reports

World Travel and Tourism Council (2016). Travel and Tourism Impact: United Arab Emirates. Available at https://www.wttc.org/-/media/files/reports/economic%20impact%20research/countries%202015/unitedarabemirates2015.pdf [Accessed 22 October, 2016].

Blanke, J. and Chiesa, T. (2011). The Travel and Tourism Competitiveness Report 2011. Geneva: World Economic Forum.

Dubai Economic Council (2009). “Clusters and Dubai’s Competitiveness Report”. Dubai Economic Council. Dubai, UAE.

Dubai Tourism (2016). Statistics on Dubai Tourism. Available at http://www.visitdubai.com/en/tourism-performance-report [Accessed 22 October, 2016]

Books/Journals

Sharpley, Richard (2008) Planning for Tourism: The Case of Dubai. Journal Tourism and Hospitality Planning & Development Volume 5, 2008 – Issue 1. Available at http://www.tandfonline.com/doi/abs/10.1080/14790530801936429 [Accessed 26 October, 2016].

Davidson, C. M. (2008). Dubai, The Vulnerability of Success. New York: Columbia University Press.

Stephenson, Marcus (2014). Tourism, development and ‘destination Dubai’: cultural dilemmas and future challenges Journal. Current Issues in Tourism Volume 17, 2014 – Issue 8. 723-738.

Reference Diary

This is a diary of the references used in this work. It was difficult initially to locate sources for the coursework. There was no single resource that would allow me to gather information on the subject.  There I decided to get information from a wide range of sources.

The first sources that I used were websites. These were websites which contained information on the existing helicopter services in Dubai and Abu Dhabi. These websites were those of private company and an article on living in Dubai and the existing helicopter services in the city. This allowed me to understand the existing situation regarding helicopter services especially in the tourism sector. Townsend’s article on Uber was very helpful as it allowed me to identify the existing trends in the sector.

I used several reports on the Dubai and the UAE and this allowed me to understand what was happening in the sector. They also allowed me to understand the current and existing excellent communications in the area. These excellent communications had very important implications for the helicopter tourist and taxi services and their future.

Sharpley and Stephenson’s’ article allowed me to understand the challenges facing Dubai in particular regarding tourism. It also provided me with information on the existing tourist industry in Dubai which was very relevant to the topic.

One work that was especially helpful was that of Davidson and his work. This provided a good overview of Dubai and indeed also of the UAE. It also provided information on the nature of Dubai society and the life of the rich in the city. It also identified the often-fragile nature of Dubai, which was something that needed to be considered when evaluating the trends in the subject area.

Revision Guide

The aviation sector in UAE.  There are many helicopter charter companies in Dubai.  This is because of the nature of the society and the economy. Helicopters are more common in Dubai and Abu Dhabi than elsewhere in the world. This is because of two factors

1. The great wealth of the people- the local rich and the Saudi rich.
2. Then there is the fast-growing tourist sector.

There are two main uses for the helicopter in Dubai and Abu Dhabi and that is for tourism and short distance travel.

The tourist sector is very important and there are also a great deal of expatriates living in Dubai and Abu Dhabi. What does this mean for trends in the helicopter sector?

There are now many helipads in the city of Dubai. The same is also the case in Abu Dhabi and this reflects the high level of the private ownership of helicopters in both cities. This is a major trend in the sector and it may continue to grow. This is very important for trends in the city of Dubai and the UAE.

There is a need to identify who will use the helicopter services. That is apart from tourists. The research would seem to indicate based on the high private helicopter ownership rates in the country that those who are just below the super-rich would be most likely to use the services. More and more of these people are travelling to and living in Dubai and this is a positive for the sector. This means that there are good prospects for the future of the sector.

The study would seem to indicate that there is already a lot of helicopter companies in the country and there even may be too much competition.

The study would seem to indicate that there are excellent travel facilities in the country and that there ae many ways to quickly travel between Dubai and Abu Dhabi. This means that there is no real need for any regular helicopter service between the two cities. There are also too many competitors in the area.

The city of Dubai has many helipads but there may be room for more in two or three areas. Near the Atlantis Hotels in the Jumina Palm area. This is because the wealthy tend to live here.

Then there is the development that is known as The World. This is a massive development and there is at present no helipad at the area, despite there being many rich people living there.

For the What if- scenario

This may involve discussing the Uber moment- that is how the hiring service will impact on the sector.