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Middle East

UA President Predicts U.S. Action Against Gulf Carriers

UA President Predicts U.S. Action Against Gulf Carriers
Jeff Edwards

United Airlines President Scott Kirby told a gathering of industry insiders that US regulators will find a way to stop the “back-door subsidies” he says put Gulf carriers at an unfair advantage.

As the feud between legacy carriers based in the US and airlines based in the Gulf States has at times devolved into name-calling and public bickering, the last two presidential administrations have so far tactfully avoided taking a strong position on the long-running controversy. Speaking at the International Aviation Forecast Summit in Las Vegas, United Airlines President Scott Kirby said he is hopeful the feds will “someday” come down on the right side of the issue.

“Our political system in the United States is messy and often frustrating, but the great thing about this country is at the end of the day, we do the right thing,” Kirby said in the public comments first reported by Skift“This is so clearly the right thing. I don’t know when or exactly how it will happen but I believe that we will get to a world where we get fair competition.”

US legacy carriers have long contended that major Gulf airlines such as Emirates, Qatar Airways and Etihad Airways have violated Open Skies treaties by receiving billions of dollars in government subsidies. The leadership at American Airlines, United Airlines and Delta Airlines have, for years now, urged US policymakers to review the Gulf carriers’ compliance with the existing treaties.

Contra-wise, Gulf Airlines have accused US airlines of taking billions in federal aid after the September 11 attacks on Washington, DC and New York. In February of 2015, Delta CEO Richard Anderson angrily defended restructuring of the US airline industry in the wake of the 9/11 terrorist attacks and reminded the public the plots against the US originated in the Arabian Peninsula. A few weeks later, Qatar Airways CEO Akbar Al Baker denied that his airline receives any government assistance and then things turned personal.

“He has in my opinion a weak personality, and he is only hiding behind all this nonsense, misleading his government in a big way,” Akbar Al Baker said in public comments in which he blasted Delta for flying “sub-par aircraft.”

Despite the heated rhetoric, officials in the US have so far been hesitant to take any action against the Gulf state airlines. Though he shied away from the fiery language of his counterparts at Delta, Kirby told those gathered in Las Vegas that his competitors in the Middle East are concealing a very real and unfair competitive advantage.

“I think it’s a front door, back door, side door, windows,” Kirby told industry leaders on Tuesday. “I think they are just getting subsidies across the board. When we first started this, you would go in to meet with a regulator and a politician and people were very skeptical and thought here come the big airlines whining about not having to compete. You walk out and no one even debates about whether they are subsidized or not. The only debate is what should we do about it.”

View Comments (7)

7 Comments

  1. Sabai

    September 5, 2017 at 10:21 am

    The US Cartels cannot compete on price or service, so this comes as no surprise.

  2. seat1C

    September 5, 2017 at 12:05 pm

    Each of the big 3 US carriers has been in bankruptcy protection over recent years – something that isn’t allow in Europe or the Middle East. When someone can explain to me why being able to dump all your liabilities and keep on trading isn’t a form of state subsidy then I might have some sympathy. (Don’t even start me as to how Boeing is subsidised).

    The big 3 US carriers mainly don’t fly where the Gulf 3 fly – what are there really concerned about?

  3. dvs7310

    September 5, 2017 at 6:30 pm

    The Middle East 3 all offer the best inflight entertainment throughout the plane, they use the most up to date premium cabin seating, they rule their flight crews with an iron fist to ensure good passenger service in the air…United on the other hand is still using 8 seat across business class cabins with zero privacy and has old hags for flight crew that are in a bad mood as often as not. This has never been about who gets subsidies, it’s the fact that the US 3 don’t want to invest frequently enough in the new hard product nor force cultural change in their ranks.

  4. jrpallante

    September 6, 2017 at 12:45 am

    United and Delta should refer to the case of Pot v. Kettle

  5. anirudh666

    September 6, 2017 at 5:21 am

    I flew Delta Airlines from BLR-DTW a few weeks ago, via CDG.

    DTW-CDG was OK, but food was not as good as Etihad or Emirates. CDG-BLR leg was horrible, seats so hard that it might as well have been a tree trunk. Bad food. Outdated in-flight entertainment console – you could see the square grid on the screen!

    These US airlines neither fly this route with consistently good service, nor do they show any signs of improving – and they wonder why people fly Middle Eastern airlines!

  6. Cofyknsult

    September 6, 2017 at 9:15 am

    Blame Blame Blame….

    So much easier to find outlandish reasons for one’s own failures… Russian Conspiracy, Subsidies for the ME3 etc… The US airlines are losing because they provide abominable service at Sky-High prices, versus top notch treatment at palatable levels. The same goes (actually Has just gone) with politicians.

    When Los Angeles Auckland in the Front Cabine costs 3 times the price of NY-Paris (with a US airline)-Doha-Auckland, there remains nothing to be said.

    Breaking the thermometer will NOT rid you of the temperature.

  7. cairns

    September 8, 2017 at 6:23 am

    This from the president of a company who showed little regret for for “re-accomodating” a customer who was forcibly dragged from his seat. Until the video went viral that is.

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