Etihad Airways no longer expects to reach financial break-even next year as a result of the current economic crisis.

CEO James Hogan said at the Dubai Air Show that Etihad will aim for a profit in 2011, one year later than originally planned. Etihad has been operating for six years now.

Hogan said the delay was due to the currently difficult yield environment. While Etihad has kept its load factor "at an acceptable level," the airline has done so at the expense of yields. Etihad continued to expand as travel demand to the UAE collapsed by up to 40% this summer. Etihad now has 49 aircraft and operates to 57 destinations. Hogan expects Etihad to carry seven million passengers in 2009 and achieve $3 billion in annual revenues. The airline does not disclose detailed financial figures, but is understood to have made a huge loss in 2008.

However, Hogan says advance sales are encouraging as travelers are booking earlier than usual recently, giving him confidence that an upturn could be around the corner. He also pointed to improved demand for cargo.

Etihad plans to invest around $750 million in cabin upgrades and MRO work, as the airline is expanding its fleet over the next few years. The airline will install Panasonic's eX2 inflight entertainment and information system onboard all new Airbus A330-300s and Boeing 777s due for delivery from late 2009 and 2011, respectively. Also, a new first class suite will be installed on nine A340s in the existing fleet, retrofitted to the existing A330s and installed future long-haul aircraft that are not dedicated to regional flying.

Image credit: Airbus