Qatar Airways Really Is Subsidized… By The U.S.

Delta — along with to a modestly lesser extent United and American — have spent the past two and a half years arguing that the federal government should take money from US consumers and redistribute it to their shareholders because the largest and most profitable airlines in the world are forced to compete with Emirates, Etihad, and Qatar.

And they argue that those airlines are subsidized, that their own subsidies don’t count, and that we shouldn’t worry about other subsidized foreign airlines (especially ones Delta owns a stake in or shares revenue with).

The Obama administration did nothing with these pleas, understanding correctly that subsidies do not violate the Open Skies treaties the US has signed with Qatar and the UAE — and that a policy of Open Skies has benefited US aviation for decades (and allows Fedex to have an important hub in Dubai).

Delta has had hopes that economic nationalists in the Trump administration would see things differently, look past the fact that the Gulf airlines are huge buyers of Boeing aircraft (and that Delta is not), and defenestrate Akbar al Baker impose some sort of sanctions.

In this context I thought it was interesting — though perhaps apropos of very little — that the new Qatar Airways cargo flight to Pittsburgh will receive subsidies… from the region’s airport authority.

The Allegheny County Airport Authority could end up paying Qatar Airways nearly $1.5 million in exchange for twice weekly cargo flights to and from Pittsburgh.

Under the terms of the one-year agreement, the authority is obligated to pay Qatar a guaranteed “support fee” of $15,500 per flight for the first six months of the service. That works out to about $744,000.

Pittsburgh is also, by the way, paying:

  • $500,000 over two years for the new Alaska Airlines service to Seattle which starts next year

  • $800,000 over two years to Wow Airlines for their nonstop Pittsburgh – Reykjavik flight

  • $500,000 over two years to Condor Airlines for seasonal Frankfurt service

Just like, of course, Delta receives subsidies from Indianapolis.

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 InsideFlyer.com, 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 »

More articles by Gary Leff »

Comments

  1. PIT should have pooled all those subsidies into bidding to win JetBlue Airways over in 2008 when they chose JFK as their main base. My understanding is PIT was under consideration due to its location and US Airways having left the airport ~300 flights lighter/day, but the airport had the highest landing fees in the nation.

  2. @Ferdinand Magellan – that’s probably more of a subsidy to Boeing than to Emirates but sure, Ex-Im is a disaster (that Delta opposes, because they don’t buy new Boeing jets)

  3. Um, here we go again with the misuse of the word subsidy. Qatar airways is not the one being subsidized. They are being paid for the service they would not otherwise provide. The people of Pittsburgh are the ones receiving the subsidy, for without the additional payment from the the Airport authority, Qatar Airways would not operate the cargo flights.

  4. @Rob kinda like how anti-abortion laws are not anti-womens’ rights or how stripping voting rights is not racist? Pretzel logic at its loopiest.

Leave a Reply

Your email address will not be published.