American Ending Codesharing With Qatar and Etihad Effective March 25

For the past two years American has been asking the federal government to crack down on flights to the U.S. by Emirates, Etihad, and Qatar. Along with Delta and United they want less competition and higher prices.

Inconveniently for American, however, they have maintained a codesharing relationship with Etihad as well as a frequent flyer partnership. And Qatar Airways is a member of the oneworld alliance with American, so they offer reciprocal mileage-earning and redemption and frequent flyer recognition.

Qatar is also the largest owner of shares in IAG, the parent of British Airways and Iberia. American shares revenue on flights across the Atlantic with British Airways and Iberia (and Finnair).

Delta, of course, shares revenue across the Atlantic with Alitalia, which has been propped up and significantly owned by Etihad. In other words, they look like hypocrites.

American appears to have decided they’re ‘all in’ on the strategy of getting the government to redistribute income from consumers to the big airlines. So they’re no longer going to codeshare with Etihad or Qatar.

American tells me,

In light of our ongoing dispute over the Open Skies agreements, American Airlines notified Etihad Airways and Qatar Airways on June 29 of our decision to terminate our codeshare relationships.

Given the extremely strong public stance that American has taken on the ME3 issue, we have reached the conclusion that the codesharing relationships between American and these carriers no longer make sense for us.

This decision has no material financial impact on American and is an extension of our stance against the illegal subsidies that these carriers receive from their governments. We are committed to doing everything we can to continue to support our team members and ensure that there is fair competition between American and the Gulf carriers.

They’re not going to do this right away. American served notice they will cease codesharing effective March 25, 2018.

American will remain frequent flyer partners with Qatar through the oneworld alliance, so customers don’t appear to be affected by the change (unless American also alters it’s mileage-earning or elite qualifying dollars chart as well).

In fact American says “There are no changes to the frequent flier relationships or interline agreements at this time” with either Etihad or Qatar. (The Etihad relationship could presumably be revisited more easily in the future since it exists outside an alliance.)

Etihad First Apartment

American is losing its partnership with Jet Airways at the end of the year. It’s losing most of the value in its Alaska Airlines partnership at the end of the year. So AAdvantage is bleeding.

Making any change to the frequent flyer partnerships here would be a critical blow, and a self-inflicted one.

Meanwhile American Airlines filed an SEC 8-K this afternoon making public that they had been notified by the Federal Trade Commission that Qatar Airways had withdrawn its earlier filed notification of intent to acquire shares in the airline and replaced it with a new notification on Monday.

American did not disclose details of the new notification in its filing, however they took a gratuitous shot at the airline (in that calling out Donald Trump to ‘stand up to foreign governments’ is sort of beside the point in an SEC filing).

The proposed investment by Qatar Airways was not solicited by American Airlines and would in no way change the Company’s Board composition, governance, management or strategic direction.

It also does not alter American Airlines’ conviction on the need to enforce the Open Skies agreements with the United Arab Emirates and the nation of Qatar and ensure fair competition with Gulf carriers, including Qatar Airways. American Airlines continues to believe that the President and his administration will stand up to foreign governments to end massive carrier subsidies that threaten the U.S. aviation industry and that threaten American jobs.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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  1. […] American Airlines ending code share agreements with Qatar, Etihad airlines. American Airlines announced yesterday it is ending its code share agreements with Etihad Airways and Qatar Airways over an ongoing dispute about Gulf states’ support for the carriers. The changes will go into effect March 25, 2018. There are no changes to the frequent flier relationships or interline agreements at this time. (Read more at View from the Wing) […]


  1. Travelista – b/c they aren’t owned by IAG, but American shares transatlantic revenue with them.

  2. AA seems to be cutting ties (or being ties) left and right while their hyped-up investment in CZ still hasn’t provided any real benefits, either for the airline or its passengers. And that’s on top of gutting the award chart and offering essentially zero saver award space unless you want to fly ORD-MSP at Tues 10pm.

    And of course their illogical discussion to exit the TLV market completely with apologists claiming how the financial benefits are not worth the effort while UA flies TRIPLE daily to TLV and upgrades one of them to brand new 77W with true Polaris . One can marginally argue how the US-Indian market is hard to print cash, but it takes a lot of LSD to proclaim TLV being not worth their time while both DL and UA laughs all the way to the bank.

  3. Have to imagine at some point in the not to distant future you won’t be able to redeem AA miles on EY……

  4. I hope IAG controlled airlines terminate code sharing agreements with American pointing to their terrible reputation in US. This airline can’t compete in domestic market and wants to take on big carriers using government as shield. Terrible management…

  5. Lots of Monday morning quarterbacking in the comments, but AA’s financial results (like today’s June revenue and traffic report) speak for themselves.

  6. After the inevitable 1929-style market crash finally happens once the long ago proven bankrupt policies the current stone-age minded administration run their course (as in crash and burn as they surely will), hopefully the first thing done after having to stabilize the economy from its massive freefall and Great Depression like unemployment, will be either complete and total reregulation of industries like airlines that just can’t seem to avoid the temptation from their stupid, greedy, selfish and increasingly out-of-control arrogant abuse of power.

    Either that, or the apostles of free-markets will grow a pair and demand that these hypocritical and monopolistic jerks be broken down, and cut down to size.

    Their arrogance and greed seems to show no bounds, and the insufferable stupidity and incompetence of the current administration will only embolden these three crappy, lying airlines to behave even worse than they already have in recent years.

    Airlines, like many other businesses now believe their “savior” has arrived, if only because the word is out that “anything goes” and it’s perfectly OK to lie and cheat without consequences since there’s a bumbling fool running the country right now.

    Oh, the price of this madness is going to be mindboggling when it all comes crashing down…

    So “sad” that so many won’t understand this until a future point in time when the consequences will be so great, the lives lost lost many, and the cost and burden of cleaning the mess will take a generation or more to overcome.

    What a shame. So much wasted time and money all because so many people glorify a fantasy version of a past that never was, “buy into” this fantasy world and seek to “return” to whatever they’re misled into believing existed when it never did, all because they have no meaningful understanding of the impacts the policies (or lack thereof) the bumbling fool they blindly believe will actually have within a few years.

    But in lacking any meaningful knowledge of what will result from the rampant dishonesty and abuses that will increasingly proliferate in the next few years, with the actions of the hypocritical and outright lies as exemplified by the big 3 US airlines, for many of us, we’re just going to have to it back and “watch this movie…even though we already know how it ends” since, unfortunately, there are so many who have to live this nightmare for themselves — as they surely will — before they’re finally willing to accept that they fell for the lies and cons hook, line and sinker.

    Never before has it ever been clearer in at least the past 50 years or so that those who fail to have any understanding of the past are doomed to repeat it.

    That we’re even considering putting the very narrow interests of three greedy and crappy airlines ahead of much larger and important geopolitical, military, economic and strategic interests is not just pathetically and irredeemably stupid — it’s incredibly dangerous.

    How anyone left, right or in between can support something THIS DANGEROUS AND IRRESPONSIBLE to our nation’s defense and its interests that would alienate the leaders of countries we depend on to maintain a vital military presence in “conventional” wars, or on whom our nation depends in some fashion (even if imperfect) for intelligence in the “War on Terror”, not to mention towards dealing with a regional power like Iran, just to name a few things our nation has a lot to contend with in this part of the world that rivals surely will seek to exploit when we do “dumb things” that further alienates us from leaders and the populations of the nations they govern is simply ridiculous.

    American, by its actions must seem to think they’ve got the bumbling fool on board to rescind current aviation agreements.

    They should be ashamed to call themselves “American” while at the same time attempting to persuade our dim witted president to actually implement policies that could harm our country the way these policies surely will.

    Any smart businessperson understands that goodwill matters, and sacrificing so much simply to satisfy three greedy and crappy airlines when so much more is at stake surely cannot be seriously contemplated, much less undertaken.

    Unless, of course, one is incredibly stupid as this president surely is.

  7. @iahphx yes, (1) low fuel prices + (2) barriers to entry for competition = profit.

    American can’t really control (1) but would like more of (2).

  8. @ Gary. How do low fuel prices explain a 5 to 6% increase in unit revenue? They don’t. As to barriers to entry for competition, there are always barriers to competition. Resources are unlimited. Someone gets there first. The advantage always goes to the airlines in that country. It’s not AA’s fault that as a US carrier it has a dominant position in the US.

  9. Hard to justify working towards higher elite status on AA now. The benefits in Qatar and mileage redemption on Etihad made them attractive but that will all go out the window now. Delta with their Jet partnership looks even more attractive now.

  10. @LDVAviation “It’s not AA’s fault that as a US carrier it has a dominant position in the US.” well Delta’s operational and financial performance was better than American’s for the quarter. Low fuel prices are a large driver of US airline profits, combined with lack of competition they’ve been able to drive up price. Low fuel price isn’t the driver of unit revenue, it’s the driver of low cost, half the equation for the profit.

    In any case the stellar financial performance underscores just how little threat to these airlines the Gulf carriers are, but they can’t help themselves, they have to grab for more of consumer’s money not by being better and offering a product that passengers want to pay for but by having the government deny them any other choice. That’s sad.

  11. Gary, agree and based on your math we should be in a ripe environment for startups. With oil lower for longer most likely, a range of options are out there. Used aircraft in droves that are close on fuel efficiency, and in a slowing market Airbus & Boeing practically giving away new aircraft at the end of production runs, etc. Gotta be a way to disrupt the model in these conditions, right. Yet where are the startups.

    Same answer as why our 3 can’t compete with ME3. Airline worker unions and work rules.

    The day that US airlines can create a relationship with their employees like the ME3 is the day they can compete with them. Rightly or wrongly, ME3 can pay, say, their FA’s, a wage that is respectable in their home countries and thus offer a job that has some status in their societies. US airlines don’t. Further the ME 3 can fire an employee at will and thus has leverage/incentive against employee performance. US airlines essentially can do neither.

    Being a customer facing employee of an American airline with shorter hauls and more turns than the ME3 is a crummy job, and frankly it’s not the job of their union to care about the traveler – and they don’t. So I am actually somewhat sympathetic to the management bind the airlines find themselves in. Fair or not, they are competing with one hand tied behind their back Pay for performance does not exist, and if it did it might cost US airlines more in employee pay then they are spending now. No incentive for existing airlines to do anything other than what they are (rationally) doing now. We simply cannot compete with anyone whose employee costs are so much lower AND productivity so much better.

    I’m not at all opposed to unions stumping for better compensation, but until we can impose and enforce quality standards freely like the ME3, ie to ensure an enhanced ROI on that employee spend, our airlines simply have no competing with them.

    What we DO need and would love to see is more domestic startups. Again, ask yourself -in a low interest rate environment where there is far more investment capital then quality deal flow – where are the startups? That tells you that something is broken here.

  12. @Gary Can you still put a EY and a QR flight on a single AA award given the current geopolitical situation?

  13. @Howard Miller. You sound pretty sure. I have the following suggestions:
    (1) Then you should put all your money into gold. When the crash comes, you will be golden.
    (2) Also, there are a number of short the stock market ETF, like “SH” Short S&P500 ETF, or “RWM” Short Russell2000. Trump is so stupid, it is money in the bank. LOL, buy it on margin. Go for it. If you make a fortune on anti-Trump bets, you will be able to afford to buy first class ticket going forward. Are you a man or mouse?

  14. An American CSR just told me that they won’t ticket an award on Etihad since it was booked for travel after March 25th and their partnership is ending. Any truth to this or just a misinformed CSR? This is for an award that’s already on request btw

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