Air France KLM chief warns Emirates over expansion

Emirates Airline’s global expansion plans will be increasingly challenged by governments' reluctance to agree more traffic rights, a senior executive at Air France KLM reportedly said in New York earlier this week.

The Dubai-based airline is likely to face "more and more reluctance [by governments] to grant traffic rights," Peter Hartman, chief executive of the KLM unit of Air-France-KLM, and a member of the airline's governing board, told the Dow Jones Newswires in New York.

At the Berlin Air Show earlier this month, Emirates announced it had signed a $11.5bn deal to buy 32 additional A380 ‘superjumbo’ aircraft from European manufacturer Airbus. This was in addition to the 48 Airbus 380s, 70 Airbus 350s, 18 Boeing 777-300s and seven Boeing air freighters on order, totaling 143 wide-body aircraft worth more than $48bn at list price.

However, the carrier’s ambitious expansion plans are encountering obstacles around the globe, as governments implement increasingly protectionist policies to safeguard their own national carriers.

Recently, an unsourced report in the French La Tribune newspaper said the French government had rejected requests to allow Emirates to obtain more landing slots in Paris and had only agreed to one new landing slot, between Dubai and the French city of Lyon. Emirates has also been refused permission to increase its capacity to Canada and South Korea and is also embroiled in a fare dispute with the German government, which last year forced it to raise its rates on some routes to Germany so that it did not undercut EU carriers.

An Emirates spokesperson told Arabian Business in an emailed statement on Thursday that “the decision on airport slots are negotiated by the Dubai Civil Aviation Authority (DCAA) and the aeronautical authorities of the governments involved.”

The chances of European countries blocking route applications from Gulf carriers are slim because of the impact that would have on Airbus, said Richard Aboulafia, vice president at Fairfax, Virginia based consultant Teal Group.

The planemaker has plants in France, Germany, Spain and the UK, has 280 orders for its A380 and A350 models from Emirates, Qatar Airways and Etihad Airways of Abu Dhabi.

“The Middle East is grabbing market share from legacy airlines and European governments seem willing to make that sacrifice," Aboulfia added.