The U.S. is going to enter talks with the UAE and Qatar about airline subsidies but it doesn’t sound like they’ll amount to much.
- The State Department will “discuss allegations that the Persian Gulf nations have spent billions of dollars subsidizing their state-sponsored airlines”
- They “will seek commitments to financial transparency” which of course will be forthcoming
- The U.S. will also “inquire about” perfectly legal plans to add flights between Europe and the U.S. like Emirates service from Milan and Athens to New York
- Finally they will “push the Persian Gulf countries to keep an arm’s-length approach toward their carriers”
There’s no bluster just soft language. And it’s being handled at the level of
an intern the U.S. State Department’s Acting Deputy Assistant Secretary for Transportation Affairs. Because subsidies do not violate treaties the Open Skies treaties the US has signed, indeed the treaty section in each agreement on ‘fair competition’ is about reducing government barriers to the other country’s ability to fly, not imposing barriers as Delta, United, and American have lobbied for. In fact that’s why these talks will “take place outside of formal “open skies” agreements.”
The Obama Administation took a similar approach and decided there wasn’t any here here. Nonetheless regardless of whether formal steps are taken by the U.S. government heavily subsidized U.S. airlines have effectively won given the pullback from the U.S. market by some of their adversaries and slowed growth plans of others.
The irony of complaining that other airlines were too intertwined with governments always seemed lost on United, who lost a CEO over a scandal involving the airline bribing a government official. Or Delta’s CEO who started all of this going on to run heavily subsidized Amtrak.
And in the end it all rebounds to the benefit of Delta, who outfoxed American Airlines into giving up partnerships that allowed the world’s largest airline reach into India, Pakistan and the surrounding region while stealing away India’s Jet Airways as a partner for itself.