Dispute between US and Gulf carriers takes new turn

31 January 2016

Decline in bookings from key US cities to the region limited only to US carriers, says Dubai’s Emirates airline

Dubai’s Emirates airline says the claim made by the Big Three US airlines – American Airlines, Delta Air Lines and United Airlines – is false that bookings from Orlando, San Francisco and Chicago to the Middle East and its neighbouring regions have declined following the Gulf airlines’ entry into these markets.

The Partnership for Open and Fair Skies has said passenger bookings for international itineraries on US carriers and their joint venture partners declined by an average of 13.3 per cent in Orlando, 13.1 per cent in San Francisco and 8.8 per cent in Chicago.

Emirates said in a statement that the decline is limited only to the US carriers and their partners, and it is not reflective of the overall bookings made in those airports. Emirates maintains that its overall bookings to the Middle East, West Asia and Southeast Asia from Orlando had in fact increased by 74 per cent during the same period.

“The latest rhetoric… once again demonstrates how the Big Three are only concerned with their narrow interests, at the expense of consumers and the broader economic interest,” an Emirates spokesperson said.

The three Gulf airlines – Emirates, Qatar Airways and Abu Dhabi’s Etihad Airways – have been locked in an intense year-long verbal dispute with the US Big Three, which allege that the Gulf airlines have received $42bn in subsidies from their home governments, effectively violating the Open Skies agreement.

This allegation has been strongly denied by the Gulf carriers, and both sides are awaiting a decision from the US Transport Department (DoT), which is reviewing the case. The Big Three are seeking for a review of the Open Skies agreement with a view to limiting future expansion of the Gulf airlines into key US cities.

Qatar Airways’ CEO Akbar al-Baker said at a forum during the recent Bahrain International Air Show that he expects the DoT to rule in favour of the Gulf airlines. Al-Baker said the US government is starting to realise the case was a total waste of time and money because the US Big Three’s lawyers are trying “to prove a losing case”.

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