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American CEO Not “Particularly Excited” About Qatar Investment

Doug Parker calls investment “puzzling” in light of Open Skies debates.

American Airlines’ executives are reacting negatively to Qatar Airways’ move to purchase 10 percent of their company, due to their previous rift over alleged government subsidies and Open Skies. CNBC reports American chief executive Doug Parker expressed his concerns in an internally distributed letter sent to employees.

“While anyone can purchase our shares in the open market, we aren’t particularly excited about Qatar’s outreach,” Parker wrote, according to CNBC. “And we find it puzzling given our extremely public stance on the illegal subsidies that Qatar, Emirates and Etihad have all received over the years from their governments.”

On Thursday, June 22, BBC News reported the Qatari flag carrier’s intention to purchase up to $808 million in American shares, adding up to a 10 percent stake. While the carrier has not announced whether or not they will accept the unsolicited bid, the move is in line with other investments by Qatar. In 2015, the airline completed a 20 percent purchase of IAG, parent company to Aer Lingus, British Airways and Iberia.

Despite being members of the oneworld alliance, the two carriers have publicly gone back-and-forth over the Open Skies issue. In 2015, Qatar chief executive Akbar Al-Baker threatened to leave the airline alliance over the American legacy carrier’s accusations. In 2016, Parker called the Middle East carriers “The biggest threat I’ve ever seen to commercial aviation in the United States.”

Investors for Qatar Airways say that they would not involve themselves with day-to-day business at American, but see the stock as “a good investment opportunity.” Parker promised that the investment offer would not change his airline’s stance on investigating the Middle Eastern carriers’ alleged subsidies from their governments.

“We will not be discouraged or dissuaded from our full court press in Washington, D.C., to stand up to companies that are illegally subsidized by their governments,” Parker wrote, according to CNBC.

Neither the Partnership for Open and Fair Skies nor the U.S. Airlines for Open Skies, the two coalitions on either side of the Open Skies issue, have issued a public statement about Qatar’s announcement.

[Photo: Shutterstock]

Comments are Closed.
edgewood49 June 27, 2017

Did anyone see that Dickie famed CEO of DL and chief whiner is now CEO of Amtrak? So does that mean he will be complaining about the ME3 causing his trains to loose money ?

Sydneyberlin June 27, 2017

How about AA finally starts working on their service offering, their food and beverage and replace more of their old rattling air planes rather than whinging about 'unfair' competition. This is just pathetic- same goes for the likes of BA and LH on the other side of the Atlantic too.

vernonc June 26, 2017

Should make for some interesting board meetings at AA as I assume 10% gives Qatar a seat on the board ?

kulflyer June 25, 2017

Once the deal goes through, does that mean AA just got Qatari government subsidy? LOL!

MaxVO June 24, 2017

I'm surprised that the market value of AAL is now only $8B. Compare that with $70B for Uber.