porciuscato

Instead of devoting its resources to improve equipment, service, and safety, United is applying them to "opposition research" on overseas carriers who provide a superior product. And of course, then it spends even more to lobby congress to deny U.S. passengers access to these carriers.

http://online.wsj.com/articles/big-u...ers-1423159003

"United’s Mr. Smisek said it has taken a couple of years for the three U.S. airlines to “scour the planet” with forensic accounting to document the three Gulf airlines’ financial records. "

The argument is that Emirates and other carriers have gotten govt. help. Therefore, it's unfair and these carriers should be blocked. (Like UAL and AA have never gotten anything from the govt.).


Folks, please write your congressional representatives to stop this nonsense! If Smisek et al, succeed in this, they'll get the message that money is better invested in lobbying govt. than on providing a good product.

TravellingMan

I like their CEO's indignation of unfair competition These are the same clowns who complain about high taxes and when the FAA bill elapsed raised the fares to cover the difference.

I remember reading about the CEO of Qatar Air saying if they stop us from landing in Europe and US; they can have their aircrafts back. So which lobby is going to win - Airlines or Aircraft manufacturers?

lhrsfo

And then there's the Fly America Act - perhaps UA should be lobbying to permit Federal employees to fly on foreign carriers. Or they should persuade the government to use a dedicated troop carrying fleet.

fly18725

What the airline CEOs are doing is misguided and hypocritical considering the years they spent lobbying for open skies in other jurisdictions.

However, the amount of money being spent on this effort is almost certainly a pittance. I bet one airline's outlay wouldn't even buy fuel for 1 plane for a few days.

entropy

from the article:
United also seeks to shift good aviation jobs (Theirs) to cheaper contract labor.

As far as I can tell, the biggest benefit (particularly to EK) is 1) cheap financing and more importantly 2) no income tax in the UAE, thus they can pay labor a lot less for the same 'take home', that's a ~10% savings off the top line which is considerable.

channa

Foreign labor is often cheaper due to U.S. health insurance costs.

Take a company like United paying $10,000 or more on an employee's healthcare. If that employee makes $40,000, that's a 25% tax so to speak. And that's on top of taxes and other employee costs.

Perhaps United Continental Holdings should look for a healthcare subsidy to help level the playing field.

ccyao

Maybe they should just hire a CEO who cares enough about the company and its passengers to improve the product.

fastair

A joint statement from AA, DL, and UA. Not much different than the Boeing Airbus wars over subsidies, except that people pay attention to that as real and dismiss this as unimportant. Consumers love it when their product is subsidized, employers, workers investors, and business owners hate it when their competition is and they aren't.

Anyone remember this from a few years ago? http://www.ajc.com/news/news/opinion...irlines/nQTGr/ or this? http://seattletimes.com/html/busines...833_wto24.html

Kacee

When you have a government that can be bought, this kind of play is an inevitable result. They're all trying to get whatever competitive advantage they can. Notions of fairness or what's best for customers or employees are completely irrelevant (though management will frame the pitch in those terms if they think it will sell).

Bonehead

If I were running a US airline and found that competing foreign carriers were receiving significant financial help (read "Much more than we're getting from our government") then I'd be cranky as well. I don't get the knee-jerk anti-United comments in this thread; I would hope that folks might actually consider the arguments being made before simply going off.

Channa's point about expenses is also well-taken. Wages and benefits (US versus many foreign airlines) are way out of kilter.

Kacee

The people who are commenting here know exactly what they're talking about. This has nothing to do with fairness (or treating employees well), and everything to do with gaining competitive advantage by whatever means you can.

I don't care for the Gulf carriers but it's hypocritical of the US carriers to complain about their tactics, since they also seek government subsidies, support, and protection from foreign competition at every possible opportunity. But that's just business and politics these days.

entropy

I don't really think they're going to be able to "do" anything.

Consumers *do* benefit from airlines like EK where they can get a cheaper flight and get a superior onboard experience.

Not every route is 'meant' to be, US-flagged USA-India flights become uneconomical relative to an EK connection over DXB, so be it.

US-India is an expensive route to fly nonstop, it requires carriage of a lot of fuel, double crewing and a lot of airplane time. Not even SQ could make their ULH flights to the US work.

waxearwings

This from the company that gladly takes federal and state money to subsidize operations in a new city, invests no effort to market or provide adequate service (e.g. cancelled flights), and then ceases operating the second the subsidy money dries up (see Topeka, and others).

They may have a point regarding the level of subsidy from the Gulf governments, but it is difficult to sympathize with a company that is up to the same nonsense.

I am quite happy to have foreign taxpayers subsidize my air travel.

mh3265a

Com'on now - US is more costly for a variety of reasons. Healthcare is part of the cost but UA could leverage the new health insurance markets and still provide some level of subsidy or support that might help control costs.

Exleftseat

Emirates buys 100s of A380 and other Airbus product which are in one way or another subsidized by the Europeans. No funds used from the Export/Import Bank. I gladly enjoy their superior comfort and service quality in their premium class offerings. No problem at all. UA has so many urgent needs to improve their service, on board, on the ground, in the lounges that one really wonders why they are willing to squander money away on pity matters as this one. UA service reductions like dropping the BKK flight show that the problems are homemade and not caused by the Middle Eastern carriers. A well managed company will be innovative and creative to stand up to any competition. UA, however, does not fall into that category.