Obama gov't not moving quick enough in row with Gulf carriers, say US rivals

“We are concerned there isn’t enough urgency in the process,” American Airlines CEO claims
(Getty Images)
By Staff writer
Sun 17 May 2015 11:53 AM

The three US airlines
accusing Gulf airlines of having received billions of dollars of government
subsidies have ramped up pressure on the Obama administration to take action
over their claims.

The US airlines are lobbying
the US government to prevent Gulf carriers Emirates, Etihad and Qatar Airways
from launching new routes to the US until a review of open skies agreements has
been conducted.

American Airlines chief
executive Doug Parker told a National Press Club forum in Washington on Friday:
“I’m highly confident they’ll take action because the evidence is so compelling
and it cannot be ignored.”

“We are
concerned there isn’t enough urgency in the process,” he was quoted as saying by The National newspaper.

Also at the event, Delta
chief executive Richard Anderson said the three airlines would take their cause
to congress if the Obama administration did not limit growth by the Gulf
carriers.

The row over subsidies
allegations continues with both sides making fresh claims and defences on an
almost weekly basis. 

A report released on Friday
by the Partnership for Fair and Open Skies, which represents American, Delta
and United airlines, it claimed Gulf carriers had expanded in the US by 25 percent
this year, eating up existing passenger traffic without growing overall
numbers.

Meanwhile, Etihad Airways
released its own report last week, research commissioned by the Risk Advisory
Group that showed US airlines have received $71.48 billion of benefits, more
than $70 billion of which has been since 2000, enabling them to recover from
the verge of bankruptcy to become the nation’s largest carriers with
multi-billion dollar profits.

Jim Callaghan, general counsel and company secretary of Etihad Airways,
said: “We do not question the legitimacy of benefits provided to US carriers by
the US government and the bankruptcy courts.

“We simply wish to highlight the fact that US carriers have been
benefiting and continue to benefit from a highly favorable legal regime, such
as bankruptcy protection and pension guarantees, exemptions from certain taxes,
and various other benefits.

“These benefits, which are generally only available to US carriers, have
created a highly distorted market in which carriers such as Etihad Airways have
to compete.”

The Gulf carriers have denied
receiving government subsidies to spur their growth.

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