US airlines have been out swinging against the major Middle Eastern airlines Emirates, Qatar, and Etihad — arguing that they are state subsidized and competing unfairly against US carriers, and asking the US to terminate Open Skies agreements that permit unfettered access to US markets.
The end of open skies with the region wouldn’t much hurt US airlines, since they offer only limited service to the region. But it would hurt US travelers — precisely because US airlines offer only limited service to the region.
And US airlines also don’t serve the secondary and smaller cities India and Pakistan these carriers serve, or for that matter Indonesia, Malaysia and the Philippines.
It’s true that the Middle Eastern carriers have grown. And they’ve thrown capacity in several US markets which pushed down fares, and to my delight made award availability and upgrades quite easy.
US airlines are complaining about their loss in market share to the government and demanding action. (Note, and unmentioned in their complaints, that they have a smaller share of a larger market.)
U.S. airlines have lost at least five percentage points of their share of flight bookings from the United States to the Indian subcontinent and Southeast Asia since 2008, due to fierce competition from Gulf carriers, according to data seen by Reuters.
More recently, U.S. carriers have seen an erosion in their share of bookings to Milan, according to a report the U.S. airlines sent to the White House and the departments of State, Transportation and Commerce. The 55-page white paper is not yet public.
The report says the combined share of bookings between the United States and the Indian subcontinent for Delta Air Lines (DAL.N), United Airlines (UAL.N) and American Airlines (AAL.O) has fallen to 34 percent in 2014 from 39 percent in 2008. The drop includes bookings on the airlines’ joint-venture partners, such as British Airways (ICAG.L) and Air France (AIRF.PA).
It’s true that Middle Eastern carriers have enjoyed certain government advantages. For instance, Qatar is state-owned. As are many airlines around the world not drawing the ire of US airline lobbyists who fail to point out the subsidies these US carriers receive.
Cranky Flier calls out the US airlines and explains the benefits of Open Skies today. He’s far too generous with the US airlines, though, he finds their position so incomprehensible that he assumes they must know something that aren’t sharing that could square their position with logic.
One Mile at a Time points out some of the absurd rhetoric coming out of Delta on this issue.
“It’s a great irony to have the United Arab Emirates from the Arabian peninsula talk about that given the fact that our industry was really shocked by the terrorism of 9/11 which came from terrorists from the Arabian peninsula that caused us to go through a massive restructuring.”
Delta partner and Skyteam member Saudia – the flag carrier of Saudi Arabia – received gifted aircraft from the government. But Delta’s CEO is silent on Saudia.
This is especially strange since a portion of the 9-11 Commission’s report was redacted as embarassing to Saudi Arabia, pointing fingers apparently at certain figures in the Saudi government as supporting the attacks on US planes.
American isn’t clamoring for an end to Open Skies with Jordan, home of their oneworld partner Royal Jordanian. Or clamoring about state subsidies to oneworld’s Malaysia Airlines — which has recently been taken over by a government whose state religion is Islam. When I visited their national mosque, banners were everywhere proclaiming a “9/11 Truth” conference that would focus on US war crimes.
American of course is a partner of Etihad, and a oneworld partner of Qatar. And United used to partner with both Qatar and Emirates.
Heck, the US has Open Skies with Pakistan and the airlines aren’t complaining about state-owned PIA. Probably because they do stuff like this.
US airlines aren’t concerned with free markets and don’t hate subsidies, they hate competition. And their lobbyists are concerned only with their interests, and not those of travelers or consumers. They’ve gone to such cynical lengths as to invoke the memory of 9/11 to advance their own business interests while focusing only on 3 airlines. Shame on them.