Legacy US Airways management never much liked competition. They avoided routes other airlines flew, and stopped flying virtually all routes that weren’t to or from a hub. Now that they’re in charge at American Airlines they have scaled back in the intensely competitive New York market. They’ve dropped nearly all Chicago – Asia service. And they continue to drop non-hub routes like Fort Lauderdale – Port-au-Prince.
It’s no surprise they hopped on board Delta’s campaign to have the government limit competition from Emirates, Etihad, and Qatar.
US airlines complained that those airlines were subsidized. US airlines are, too, and they fabricated evidence against their Gulf rivals. Parker said yesterday “give us $40 billion from the U.S. government and we’ll put showers in first class as well.” Of course US airlines have been given more than $40 billion from the U.S. government.
The stated objective of the campaign against Emirates, Etihad, and Qatar was anti-customer: fewer flight choices and higher prices.
Back in May the issue was settled with US airlines gaining nothing of substance. Gulf carriers agreed to issue transparent financials (Emirates already does) and said they had no current intention to launch new routes between the US and Europe (Emirates keeps theirs, Qatar hasn’t wanted any since they obtained aircraft that could fly to Doha non-stop and owns stakes in other carriers to do it in any case, and Etihad has been scaling back routes not expanding).
Delta outmaneuvered American in all of this. American Airlines was suckered into dropping its codeshares with Etihad and Qatar — which gave them reach into India, Pakistan, and North Africa — and then they were outmaneuvered by Delta and lost their partnership with Indian carrier Jet Airways.
American’s CEO Doug Parker just doesn’t know when to quit. After US carriers spent at least $50 million on lobbying and walked away empty handed, and American found itself in a worse competitive position, he’s decided to re-play his same losing hand. Now he’s complaining about Italian carrier Air Italy flying between Italy and U.S. because of Qatar’s 49% stake in the carrier.
“We have side letters that talk about they don’t intend to fly nonstop flights from outside the Gulf to the United States,” Parker said. “We have one of them now using a carrier they made an investment in to fly to the United States.”
…“This is about American jobs,” he said. “It needs to be addressed.”
Parker is shocked, shocked, that Air Italy flies to the U.S. even though Qatar purchased its 49% stake in Meridiana (now Air Italy) in 2017 prior to settling US airline complaints over their perfect legal activities under the US-Qatar Open Skies Treaty.
And the hypocrisy here is risible. There’s never been any complaint about Gulf carriers investing in European airlines which fly to the U.S.
- Qatar is the largest shareholder in IAG, which owns British Airways, Iberia, Aer Lingus, and Vueling. British Airways and Iberia (and likely soon Aer Lingus) have an anti-trust immunized revenue sharing joint venture with American.
- Etihad was the most recent airline to control and provide subsidies to Alitalia, which has been part of an anti-trust immunized revenue-sharing pact with Delta.
- Etihad controlled and subsidized the now-defunct oneworld member and American Airlines partner air berlin.
Parker is worried about airline jobs when airline employment is at a peak and when his own flight attendants and mechanics unions are furious at him. Although it’s a well-worn strategy to blame foreigners as a distraction for problems at home. It’s even more ironic though because he did this in a speech where he also talked about inclusion.