Middle East carrier executives double-down on increasing service to the United States, while legacy carriers continue to reduce service to Gulf destinations
The chief executives of both Etihad Airways and Qatar Airways are taking aim at America’s legacy carriers by effectively dismissing the Open Skies investigation while continuing to expand services at airports in the United States. Meanwhile, America’s legacy carriers are responding by continuing to reduce service to the Middle East, as United announced they will be the next to cut air routes.
The exchanged blows reflect the latest tussle in the Open Skies controversy engulfing America’s three legacy carriers (American Airlines, Delta Air Lines and United Airlines) and the Middle East Three (Emirates, Etihad and Qatar Airways). Opened nearly a year ago, the American carriers allege the ME3 were allowed rapid expansion through the acceptance of $42 billion in subsidies from their respective governments.
Today, Etihad chief executive James Hogan claims he has other concerns to worry about.
“I run a global airline based in Abu Dhabi and we operate in six continents in the world. We have challenges in every continent. Quite frankly, we’ve tackled this,” Hogan said in an interview with Skift when asked about Open Skies. “We’ve addressed it properly and thoroughly and I’m more focused on the day-to-day issues at a point in time.”
Hogan claims his airline has only improved the U.S. aviation industry, citing Etihad’s continued working agreements with American and JetBlue. According to the executive, Etihad only provides less than one percent of all available seats departing the United States but provides a bigger footprint of connectivity around the world.
The comments mirrored those of outspoken Qatar Airways chief executive Akbar al-Baker. While announcing the first Airbus A350 service to the United States at a press conference on Wednesday, December 9, al-Baker had one word to describe the allegations made against his airline and his colleagues: “baloney.”
“What [the legacy carriers] are trying to do is to stifle competition to deprive the American public,” al-Baker told the gathered press at the event, according to Mashable. “Of all airlines in the world, 49 percent [of profit] is made by the three American carriers…what more do they want?”
The executive used his podium time to illustrate the differences between the passenger experience aboard his airline and that aboard the American carriers, claiming Qatar Airways strived to create an experience for passengers. When asked about his continued rivalry with Delta chief executive Richard Anderson, who once called the ME3 the greatest challenge to the aviation industry, al-Baker made his feelings very clear.
“Let him come face to face with me in any forum,” the executive told the group. “I will hang him on a wall.”
The statements from the two Gulf carriers were met by one from legacy carrier United Airlines. After losing a government contract to JetBlue, the carrier announced they would no longer service Dubai International Airport (DXB) from their hub at Washington Dulles International Airport (IAD). In a press release, United blamed the U.S. government for the reduction in service, after the General Services Administration (GSA) awarded a transportation contract between IAD and DXB to JetBlue. The airline noted that JetBlue does not operate flights between the two countries, leaving the work to codeshare partner Emirates.
“It is unfortunate that the GSA awarded this route to an airline that has no service to the Middle East and will rely entirely on a subsidized foreign carrier to transport U.S. government employees, military personnel and contractors,” Steve Morrissey, vice president of regulatory and policy at United, said in the statement. “We believe this decision violates the intent of the Fly America Act, which expressly limits the U.S. government from procuring commercial airline services directly from a non-U.S. carrier.”
The concerns were echoed by the Partnership of Open and Fair Skies, a consortium representing the legacy carriers and other interested parties in the United States. The group called upon the Obama administration to settle the current Open Skies argument and level the growth of the ME3 in the United States.
“United’s decision is further proof that the billions of dollars in Gulf carrier subsidies have distorted the playing field and made true competition impossible for U.S. carriers,” Jill Zuckman, spokesperson for The Partnership, said in a statement. “When this happens, the men and women of the U.S. aviation industry are the ones who are hurt.”
The reduction in service is the second by an American legacy carrier. Earlier this year, Delta announced they would also stop service to the Middle East, ending daily service from Atlanta to Dubai.