We have seen airlines like Pan Am have their glory days end, along with airlines like Virgin Atlantic see its growth stagnate due to restrictions at LHR and seen their product innovation also fall behind. Singapore Airlines went from being an airline that seemed to have good growth and a strong product to an airline that has had little growth in many years and has turned much of its focus to its low-cost subsidiary.

It made me start to think while Emirates is leading now with onboard innovations such as its showers, and bars on the A380 along with impressive growth, what will be the donwfall of EK? It would seem judging by history nothing lasts forever and while EK is leading in many respects today someone else will leapfrog them in the future. Will competition from an airline like TK or QR be what hurts them, capacity constraints in Dubai, employee relations, a major accident or a pivot away from aviation by the UAE government or something else? Further, who might we see take their place?

the breakup of the UAE.

meh...maybe.

Aircraft that render DXB/AUH/DOH useless.

Flying space monkeys or global warming? Equal likelihood.

I suspect that, within a few years, 'two engines' will be enough. Meaning much greater competition on all routes?

[Edited 2016-03-27 21:17:42]

Quoting NAV30 (Reply 4):

But will it be economical to fly such long routes nonstop? Many long-haul routes could be done with aircraft available now such as the 777-200LR but are not due to the weight of fuel they need to carry and the inefficiency this creates.

I think we'll know when they have flat growth over a certain period of time and increased competition from the likes of TK and others. If what we have been hearing from the captains and FO's is true, then they'll have to curb this furious growth and establish more transparency in regards to the roster schedules.

I can see a couple of possible scenarios :

If "the West" ever loses patience with Saudi Arabia and walks away from supporting the royal family, I can imagine the country descending into civil war.... that could cause major disruption to the airspace of the whole peninsula and scare people away from hubs in the immediate vicinity. Most travellers using EK/EY/QR have no real need to travel via Dubai/Abu Dhabi/Doha, they only do it because it's convenient and cheap. If those hubs become unattractive the bulk of the traffic will simply switch to alternative hubs.


Inability to sustain their growth - the ME3 may be attractive from the point of view of tax free salaries, but they all have reputations as pretty unpleasant employers ( although I don't think EK's reputation is anywhere as bad as QR). From time to time there seem to be large scale resignations as opportunities arise to work ( and live) in more pleasant environments, and money isn't everything.

The UAE is similar to Saudi Arabia in that there biggest concern could be domestic terrorism.

They are doubling down like Saudi Arabia in supporting increased regional militarization which is used well by radicals as a recruiting tool.

It helps to be so rich that you can pacify the general population by supporting everything but oil prices while increasing are still generally low. Pretty much anyone royal spends more each year.

In essence they are spending more, earning less, and making new enemies all the time. It seems the memory of the fall of the Shah is lost on this latest generation.

Quoting flyingcat (Reply 8): The UAE is similar to Saudi Arabia in that there biggest concern could be domestic terrorism.

I agree. But Saudi is a huge buffer for the UAE in sheer size.

I'd also throw in that with the heightened tensions between KSA and Iran, if that were to boil over, the UAE is literally in the middle of that. That won't bode well for the whole region.

Emirates' growth and consistent profitability is due to its very clever and logical management, advertising, and blessed geographical location. Their operations are well thought of with great connections and an infrastructure that's supports the same. I personally don't see them decline on performance anytime soon. Competition is healthy, but for the ME3, Emirates is far ahead of the game for some time to come.. What Emirates is doing today, QR and EY can only foresee in the future if they pick up their game.

Quoting chrisp390 (Thread starter): We have seen airlines like Pan Am have their glory days end, along with airlines like Virgin Atlantic see its growth stagnate due to restrictions at LHR and seen their product innovation also fall behind. Singapore Airlines went from being an airline that seemed to have good growth and a strong product to an airline that has had little growth in many years and has turned much of its focus to its low-cost subsidiary. It made me start to think while Emirates is leading now with onboard innovations such as its showers, and bars on the A380 along with impressive growth, what will be the donwfall of EK? It would seem judging by history nothing lasts forever and while EK is leading in many respects today someone else will leapfrog them in the future. Will competition from an airline like TK or QR be what hurts them, capacity constraints in Dubai, employee relations, a major accident or a pivot away from aviation by the UAE government or something else? Further, who might we see take their place?

Interesting question. First off, you can't compare EK to the likes of Pan Am, VS, or SQ. Those airlines all answer to shareholders. Those airlines are managed to produce a profit and have limited capital resources. Whether or not Emirates is profitable or not (and I don't want to get into that debate), they have unlimited access to capital, do not answer to shareholders, and arguably are driven just as much or more to stimulate tourism and business in Dubai as they are by running a profitable airline.

Now what could cause the downfall of EK? I would start with any event that causes a worldwide sharp decline in air travel. As Emirates is basically the international airline of the world, that would be a major a blow. Of course that would effect all airlines but arguably disproportionately to EK (and the other middle eastern carriers). Also, an event that creates instability in Middle East would severlely effect EK's business (this is probably the most likely thing to curb EK's growth and even force them to downsize operations). Capacity constraints can slow them temporarily, but as I mentioned before they are an arm of the state and as long as they grow and increase the number bodies moving through Dubai - Dubai will fnance the necessary infrastructure to facilitate that growth (they are already building a new airport larger than DXB) and there is plenty of desert. Employee relations is non-issue. If they want to retain employees they have the resources to pay them whatever they want, but considering the labor laws and the fact that they the entire world is their employee pool - they will likely always be able to find somebody to replace disgruntled employees. Nothing of course will drive customers away faster than a reputation for poor safety - however EK is not stupid and I am sure they will do everything they can to protect that reputation (I also doubt they want to foster a culture where they are losing $100M assets). Accidents of course happen, but it would likely take more than one major accident. Competition from other state owned airlines is probably the biggest threat to EK. But EK has the adapvantage of already being larger than EY, QR, TK so as long as they are willing to continually invest in the on-board experience it will be thought for one of the other airlines to surpass them.

As to others who mention aircraft that make DXB, AUH, DOH, and IST useless. I would argue they already are from an aircraft technology standpoint. You can count the number of routes that can't be reached today with a 77W (old tech), and yet even fewer with 787s and 350s (new tech) that are starting to take over the skies. The issue is that consumer demand or economic viability will see those airports continue to economically viable connecting hubs for decades to come. Just because you have an aircraft that can fly JFK to BOM doesn't mean the demand is there to support such a route. The hub and spoke system is tried and true and I don't see it changing anytime soon. Look at the US domestic market, we have had aircraft that easily can fly any route nonstop but yet, funnel traffic through a couple strategic hubs makes the most sense - so increasing aircraft range and efficiency might open up a handful of new routes globally I don't see it having any impact on the hub and spoke system and thus if those Middle East airports are functioning as efficiency connecting hubs now I don't see any reason that would change anytime soon.

One last thought about what could curb EK 's business... if countries started rescinding or restricting their air traffic rights. Considering EK, EY, and QR have no home aviation market and TK's is relatively small - they rely on the ability to fly foreign citizens from one country to another. New customers = no business. I'm not saying this likely, but even restrictions in just few significant countries and their business model would suffer greatly!

One accident that downs an A380 would end EK. They need to ensure safety is #1. Complacency grows with success

War in India that curbs traffic from and flying over the sub continent would effectively stop their hub operation overnight.

Emirates' biggest bottleneck is the fact that very few native Emiratis actually use it - due to their low population.

I can foresee a point in future when Europe/India/USA might go the Canada way and restrict bilaterals with the UAE and this chokes EK to a point where they can't justify flying A380s and 779s everyplace.

Quoting jetfuel (Reply 14): One accident that downs an A380 would end EK. They need to ensure safety is #1. Complacency grows with success

When has one accident ever taken down an airline???
I think it is ridiculous to suggest one accident would end EK even if it were a 380.
Many airlines have withstood losing a 747 and are still flying today. What makes you think a major incident with a 380 would cause so much more reputational as damage?

[Edited 2016-03-27 22:59:46]

Quoting Spiderguy252 (Reply 16): I can foresee a point in future when Europe/India/USA might go the Canada way and restrict bilaterals with the UAE and this chokes EK to a point where they can't justify flying A380s and 779s everyplace.

That's illogical - the fewer flights that are permitted under bilaterals, the more likely airlines are to use big planes so as to get the best value out of the flights they can operate.

Regional conflict most likely.

Not their downfall, but I would imagine there will be a big difference when Tim Clark retires. The job he has done with EK is simply amazing....even if you don't like EK......the job he has done is outstanding.

Quoting scotron11 (Reply 20): Not their downfall, but I would imagine there will be a big difference when Tim Clark retires. The job he has done with EK is simply amazing....even if you don't like EK......the job he has done is outstanding.

He has done an amazing job and I am sure EK has few guys learning from him and preparing for the future, so I think the change will not be that big.

Quoting Spiderguy252 (Reply 16): Emirates' biggest bottleneck is the fact that very few native Emiratis actually use it - due to their low population.

But to compensate that they have few countries with huge population where EK is a well known brand, places like India, Bangladesh, Pakistan, Iran, Irak, Indonesia, Thailand...

One thing that the UAE and specially Dubai is doing is that they are creating a lot of demand also to Dubai, so many companies have opened offices in Dubai, so many tourist visit Dubai, so much wealth is there due to investment companies, that is a good decision for the future.

Quoting LAXtoATL (Reply 17): Many airlines have withstood losing a 747 and are still flying today. What makes you think a major incident with a 380 would cause so much more reputational as damage?

I am not talking about an incident but a tragic accident. This has brought down the likes of TWA, PANAM and MH

I have always believed that the embrace of western style capitalism/consumerism in the UAE would eventually make them a target of Islamic terrorist groups like IS and Al Quaeda. It goes against their beliefs of establishing an islamic caliphate.

All they would need to do is create the illusion that the UAE is no longer stable by pulling off the same type of low-tech attacks as in Paris or Belgium.

Once its perceived by US and EU travelers that the UAE is now infested with IS, tourism would fall rapidly.

A ground of the A380 fleet that takes more than an couple of days to resolve would have an major impact on the EK 'brand'. EK have put a large amount of there network into the hands of an single aircarft type.

A regional conflict between KSA/Qatar/UAE on one side and Iraq/Iran on the other would fit the bill.

Quoting zkncj (Reply 24): A ground of the A380 fleet that takes more than an couple of days to resolve would have an major impact on the EK 'brand'. EK have put a large amount of there network into the hands of an single aircarft type.

If that's your logic, surely you mean the 777, right? EK operates around 70 A380s and 150 777s. Not that the logic stands, mind; there's nothing even remotely suggesting a global grounding of either the A380 or the 777.

Quoting NAV30 (Reply 4):

Wow even this thread: 'how can I fit my low IQ in this argument?'

Hi NAV380 how many A380s do EK have on order? Or better still, don't they expect the A380-1000 Neo for them?

No level of thinking.

Quoting zkncj (Reply 24):

A lot seems centred on the A380 and its failure. They are also the biggest 77W operator in the world. So that could also be a problem should there be an issue there.

Quoting jetfuel (Reply 14): One accident that downs an A380 would end EK. They need to ensure safety is #1. Complacency grows with success

Rubbish.

Did KLM fold after Tenerife?
Did JAL fold after Mt Osutaka?
Did Korean fold after Guam?
Did SIA fold after Taipei?

All attributed to some element of complacency, but all going strong still.

Quoting flyingcat (Reply 8): The UAE is similar to Saudi Arabia in that there biggest concern could be domestic terrorism.

      
DXB has been fortunately spared thus far, but it's a sitting duck in the most volatile region on the planet: a few high-profile terrorist attacks in close proximity to each other, and watch travel/spending there plummet.

No amount of glitz or "service" could keep an airline (with 100+ A380s to fill) out of the red, if traffic to their primary hub consistently dips for any amount of time.

Quoting LAXtoATL (Reply 17): When has one accident ever taken down an airline

It's tough to recall any case where an otherwise perfectly-fine airline had a single crash, then ceased to be.

Though there have been plenty of cases where a struggling airline was dealt a coup de grace by high-profile crash:

Birgenair 301

Air Florida 90

Helios Airways 522

Hewa Bora Airways 952

Adam Air 292 (though interestingly, not the far-more-disastrous flight 574)

etc.

But these are all small carriers; there's no real parallel to the likes of EK.

Some could even argue that crashes like PanAm 103, TWA 800, and SR 111 were the beginning of the end for those carriers, but plenty of missteps were also made in the years between them and those carriers' demise.

War in the Arabian Gulf for a prolonged period.

Quoting migair54 (Reply 21): He has done an amazing job and I am sure EK has few guys learning from him and preparing for the future, so I think the change will not be that big.

Granted, but largely because of him, and the UAE billions, EK is where it is today. Those are big "boots" to fill for anyone succeeding him...nothwithstanding external factors already mentioned above (ie terrorism, regional conflict) but that would effect all carriers, not just EK.

Quoting chrisp390 (Thread starter):

Several possibilities:

1. increased P2P-flying, especially when India gets its act together.
2. regime change in the UAE and/or Dubai, turning EK into a kind of Saudia.
3. terrorism or political turmoil.
4. european type labor laws.

We know the current management is very successful under current circumstances. We don't know how it will cope with challenges in the future.

Quoting BlueShamu330s (Reply 27): All attributed to some element of complacency, but all going strong still.

Those who folded after an accident were on the brink of folding before the accident. The accident just pushed them over the cliff.

Quoting BestWestern (Reply 15):

.....or if Indian airlines ever get their act together and offer a competing long haul product but war is much more likely.

What could bring down EK would be:
1. Massive expansion at the European hubs allowing for full bypass.
2. Massive expansion at Indian hubs, as well as a cut in the fuel taxes and process improvmements to encourage international to international connections.

Without those changes, EK is safe. Since neither is likely to happen, we'll be talking EK for decades to come.

Quoting rotating14 (Reply 6): I think we'll know when they have flat growth over a certain period of time and increased competition from the likes of TK and others.

TK will slow EK's growth, but won't stop it.
EK will have more flat growth due to saturation at DXB. I wouldn't get too excited about flat growth until after they move to DWC.

Quoting nabz82 (Reply 10): Emirates' growth and consistent profitability is due to its very clever and logical management, advertising, and blessed geographical location.

They have that. But they must keep adapting, which I think they will.

Quoting jetfuel (Reply 22): I am not talking about an incident but a tragic accident. This has brought down the likes of TWA, PANAM and MH

PanAm had the Skygod culture which certainly isn't allowed at EK. So the same fundamentals are unlikely to happen. EK's issue might be the pilot fatigue.

Quoting lancelot07 (Reply 31): 1. increased P2P-flying, especially when India gets its act together.

If India gets its act together. I've been waiting for India to 'get its at together' the whole time I've been on a.net. As long as there are subsidies for AI, there is no motivation to adapt.

I have no doubt the 'bailout plan' will be extended:
http://www.firstpost.com/business/go...the-plan-to-disinvest-2538924.html

Until AI can fail, the Indian aviation market will limp along with too much government interference. It will grow, but not threaten the ME3.

Lightsaber

Short of someone nuking downtown Dubai, there is no conceivable trajectory for Emirates other than continued growth and success. They have redefined global aviation, but importantly there is no room for complacency in their corporate culture and they keep evolving and developing. Any "downfall" will not cone from sources internal to the organisation, it would have to be an external shock.

Quite frankly this thread is nothing more than a wet dream for baked on protectionists.

Biggest risks are:

1. Continued political instability in the MENA region and potentially what could happen in UAE one day?

2. Some kind of terrorist targeting / repeat incidents - perhaps in the UAE even if not at the airline itself

3. One or more accidents, which whilst seems unlikely, there is continued speculation about the way that the airline ignores human factors - look what happened at FlyDubai

There are definately risks; nothing lasts forever. They have had many conditions in their favour.

You also have to consider the growth potential of Iran and Turkey - in one sense these could generate more traffic bt you could get two competitors emerge here (TK are already having a good go at that).

Quoting chrisp390 (Thread starter): what will be the donwfall of EK?

World War III, Terrorism or several big accidents.

[Edited 2016-03-28 04:55:17]

Quoting BlueShamu330s (Reply 27): Rubbish.Did KLM fold after Tenerife?Did JAL fold after Mt Osutaka?Did Korean fold after Guam?Did SIA fold after Taipei?

Did Malaysia fold after 370/17? As good as.

I just think EK will eventually run out of places to fly and once the growth stimulus has gone out of the business, that's when complacency might set in.

Of course what then normally happens is parts of the business are spun or sold off, allowing fresh impetus and cash back in to the core...and off we go again.

What ever is the fate of EK, there is always a bright spark who comes along to fill the void.

So far I think there have only been five airlines who changed the world:

Pan Am
Southwest
Easyjet
Ryanair
Emirates

Quoting shankly (Reply 38): Did Malaysia fold after 370/17? As good as.

They were already in serious trouble, actually.

Quoting shankly (Reply 38): So far I think there have only been five airlines who changed the world:

These may have made some marked achievements in their own right, but they have all played their part. I can name many airlines who have changed the world in a different way. The industry has done this collectively.

Quoting shankly (Reply 38): Rubbish.Did KLM fold after Tenerife?Did JAL fold after Mt Osutaka?Did Korean fold after Guam?Did SIA fold after Taipei?

I think the public are more sensitive to accidents nowadays, and more connected to the news via various media - there are higher expectations on safety nowadays.

One accident would not kill EK for sure, but 2 or 3? If there was a repeat terror campaign, or a couple of disasters related to slavish crew management.... could definitely do them some harm

Quoting LAX772LR (Reply 28): DXB has been fortunately spared thus far, but it's a sitting duck in the most volatile region on the planet: a few high-profile terrorist attacks in close proximity to each other, and watch travel/spending there plummet. No amount of glitz or "service" could keep an airline (with 100+ A380s to fill) out of the red, if traffic to their primary hub consistently dips for any amount of time.

Bingo. You said it best. That is the greatest risk to EK.

The re-birth of the Ottoman (Turkish), the Persian (Iran Air) to the existing Middle Eastern empire (ME3)  

The shifting sands of time. Nothing lasts forever. History teaches us these lessons.

Quoting EMAman (Reply 39): Quoting shankly (Reply 38): Did Malaysia fold after 370/17? As good as. They were already in serious trouble, actually.

  

And after 370 / 17 their numbers got worse.

One full 'flagship' EK A380 crash could wipe out almost as many pax killed in MH 370 / 17 combined.

A few accidents like that, especially over just a few years, and EK will have turbulence.

And things will be even worse if the following happened around the same time:

Quoting LAX772LR (Reply 28): DXB has been fortunately spared thus far, but it's a sitting duck in the most volatile region on the planet: a few high-profile terrorist attacks in close proximity to each other, and watch travel/spending there plummet.

  

Quoting chrisp390 (Thread starter): Will competition from an airline like TK or QR be what hurts them

I think the constant aping of EK motions by the others is making things uncomfortable but that alone is not enough to sink EK.

Quoting chrisp390 (Thread starter): capacity constraints in Dubai

This is already a bit of an issue but with DWC on the horizon and the fact that Dubai Inc can wholesale move FZ out of DXB if they want, so this doesn't present a huge problem.

Quoting chrisp390 (Thread starter): employee relations

This is starting to become a problem and there are actions that foreign governments can put in place to exacerbate this should they so choose. There has been chatter here in Canada and elsewhere that professionals who take long sojourns overseas be forced to pay certain fees for being put back into the healthcare pool. This would make tax free DXB less attractive if at some point pilots and other "big" earners would be forced to pay the piper back home.

Quoting chrisp390 (Thread starter): major accident

Nope. The flying public has a short memory.

Quoting chrisp390 (Thread starter): a pivot away from aviation by the UAE government

I feel that the UAE has gone all in on aviation so a pivot is far from likely.

Quoting kiwiandrew (Reply 7): If "the West" ever loses patience with Saudi Arabia and walks away from supporting the royal family, I can imagine the country descending into civil war.... that could cause major disruption to the airspace of the whole peninsula and scare people away from hubs in the immediate vicinity. Most travellers using EK/EY/QR have no real need to travel via Dubai/Abu Dhabi/Doha, they only do it because it's convenient and cheap. If those hubs become unattractive the bulk of the traffic will simply switch to alternative hubs.

  

Quoting kiwiandrew (Reply 7): Inability to sustain their growth - the ME3 may be attractive from the point of view of tax free salaries, but they all have reputations as pretty unpleasant employers ( although I don't think EK's reputation is anywhere as bad as QR). From time to time there seem to be large scale resignations as opportunities arise to work ( and live) in more pleasant environments, and money isn't everything.

  

Quoting flyingcat (Reply 8): In essence they are spending more, earning less, and making new enemies all the time. It seems the memory of the fall of the Shah is lost on this latest generation.

  

Quoting WSTAKL (Reply 12): Saw the title and instantly knew the authour would be a Canadian, American or German. Should just give it a rest.

Move along, buddy. Clearly nothing for you to see here.

Quoting jetfuel (Reply 14): One accident that downs an A380 would end EK. They need to ensure safety is #1. Complacency grows with success

Nope.

Quoting Spiderguy252 (Reply 16): I can foresee a point in future when Europe/India/USA might go the Canada way and restrict bilaterals with the UAE and this chokes EK to a point where they can't justify flying A380s and 779s everyplace.

Well the EU itself is teetering. Should it collapse this would present a whole different set of market conditions for the ME3 to contend with. EY rather than EK would feel most of this pain.

Quoting RyanairGuru (Reply 35): Quite frankly this thread is nothing more than a wet dream for baked on protectionists.

Not at all. The reality is that all things - good, bad, and ugly - come to an end. I think the OP perhaps erred a bit by using the word downfall. In all likelihood EK will plateau and be forced to right-size its operations when it hit its ceiling.

YOWza

1. Political instability in the ME. EK
would be severely affected if any of its neighbouring countries enter a civil war, especially if their airspace has to be closed. The possibility of terrorism is also one to worry about, especially if the target is DXB.

2. Restricted bilaterals
You're starting to see push back to EK's right in many European and even Asian countries. It is likely that is some cases renegotiated bilaterals would lead to fewer flights and also limit the number of seats thus making the A380s harder to place.

3. TK and Indian carriers
TK is already doing extremely well and could conceivably overtake EK as the world's largest international airline. A wild card is the indian carries; if the gov't gets its infrastructure together and Indian airlines become better managed, BOM and DEL could become the new DXB, especially since they are much larger O&D markets and have good geographical locations. The Indian carries would also have lower costs than EK, and over the long term could easily undercut the airline. This resurgence of Indian aviation would most likely be supported by the restriction of ME carries in the Indian market, thus hurting EK and the likes in one of its biggest markets.

Quoting 777Jet (Reply 42): A few accidents like that, especially over just a few years, and EK will have turbulence.

In case of EK I agree. Reason is that very few people actually have to travel to Dubai. It's just a stopover to their actual destination. If travelling community feels it's unsafe to fly with EK they choose other routing.
I think that for same reason as accidents, terrorism in Dubai in a scale that hit Paris would affect EK more than AF has been affected.

Quoting chrisp390 (Thread starter): We have seen airlines like Pan Am have their glory days end, along with airlines like Virgin Atlantic see its growth stagnate due to restrictions at LHR and seen their product innovation also fall behind. Singapore Airlines went from being an airline that seemed to have good growth and a strong product to an airline that has had little growth in many years and has turned much of its focus to its low-cost subsidiary.

PanAm failed because it was a p-2-p airline without feed or hubs which made it impossible to compete against the hub and spoke airlines. Virgin Atlantic did not fail but very much like PanAm it's primarily a p-2-p airline and that is what limits its growth, not the LHR restrictions. SQ is far from failed and it's actually growing so I don't even understand why it's been included as an example.

I see no reason for EK to fail in our lifetimes. They are a well run hub airline like many others and their hub is located in one of the most heavily populated regions in the World. Growth will slow of course, that is natural for every airline once it reaches a certain size. But slower growth does not equate to a business' downfall.

So a question, how many terrorist incidents have their been in Europe recently, and how much do we read each day about cells and radicals being all over Europe waiting to strike, has tourism to Europe declined?
We see the effect in Egypt, it is still down after the bombing, my point is that it will also have to affect Europe as well, and since PC is the rave today, one cannot be seen pushing for continued travels to Europe but not the ME due to terrorist activity.

As more people leave the current hot beds for Europe, the extremist there will have to look elsewhere for their followers, how difficult it is to get to the stable ME regions or continue to Europe will be the telling point over the next few years.
Air travel will be a sideshow.

Quoting par13del (Reply 45): has tourism to Europe declined?

Don't know about Europe as whole, but tourism to Paris has declined. Brussels is likely to follow.

Quoting Thomaas (Reply 42): TK is already doing extremely well and could conceivably overtake EK as the world's largest international airline

What is the definition of "The worlds largest international airline", and who defined it ?
TK has the most international destinations already, if one believes them.

Quoting jetfuel (Reply 12):

Have to agree especially if fatigue is involved

Quoting airbazar (Reply 44): PanAm failed because it was a p-2-p airline without feed or hubs which made it impossible to compete against the hub and spoke airlines.

Pan Am also suffered from poor management for many years resulting in many bad decisions (e.g. too many 747s, serving many unprofitable destinations, the merger with National, selling their most valuable assets to generate cash, etc.)

Their founder, Juan Trippe, overstayed his welcome. And towards the end they had a new CEO every year or two and they developed a reputation for second-rate service. Even in their best years Pan Am's profitability was seldom more than marginal.