Panel discussion at the US Chamber of Commerce Aviation Summit. From L to R: Atlas Air Worldwide CEO Bill Flynn, Allegiant Air CEO Maurice Gallagher, Airbus Americas chairman Alan McArtor, JetBlue Airways CEO Robin Hayes and Alaska Airlines CEO Brad Tilden.
The CEOs of JetBlue Airways, Alaska Airlines and Atlas Air Worldwide Holdings continue to push back against American Airlines, Delta Air Lines and United Airlines on the issue of alleged Gulf airline subsidies.
American chairman and CEO Doug Parker and United CEO Oscar Munoz both used strong language at the March 2 US Chamber of Commerce Aviation Summit in Washington DC to call for the US government to take action against the United Arab Emirates (UAE) and Qatar over alleged subsidies to Emirates Airline, Etihad Airways and Qatar Airways that the US global majors assert contravenes Open Skies agreements between the US and the Gulf nations. Delta also shares the view of American and United on the issue, with all three carriers saying US airline jobs are at stake as the Gulf carriers expand flights to the US.
But speaking at the same conference later in the day, the CEOs of other US airlines warned that revisiting the terms of Open Skies agreements would be a major mistake. “We very much take a different view” from American, Delta and United on the issue, JetBlue president and CEO Robin Hayes said.
Responding to Munoz’s assertion that “facts” would ultimately push the US government to take action, Hayes said, “Let’s talk about some real numbers and real facts. The number of jobs [at US companies opposed to the American-Delta-United campaign, including, among others, JetBlue and FedEx Corp.] is 900,000.” He noted that the figure represents about three times more employees than American, Delta and United have combined.
New York-based JetBlue and Seattle-based Alaska codeshare with Gulf carriers and benefit from Middle East airlines’ feed into their domestic US networks. JetBlue and Emirates have had a partnership since 2010, which has “been very good for growth at JetBlue,” Hayes said.
“This is a network business,” Alaska chairman and CEO Brad Tilden added. “What if your cellphone was better than anyone’s cellphone, but you could only use it in Seattle or Takoma. That’s the position the smaller [US] airlines find themselves in [necessitating partnerships that extend networks] … We do feel quite strongly that having Open Skies and having these global partners is important to our success.”
Purchase, New York-based Atlas, like FedEx, is concerned that any restrictions placed by the US government on Gulf carriers’ access to the US market could jeopardize seventh-freedom cargo rights contained in Open Skies agreements. FedEx, for example, utilizes those rights in the US-UAE Open Skies accord to operate a Dubai air hub.
“Without Open Skies, neither Atlas nor FedEx nor UPS could fly the routes we do,” Atlas president and CEO Bill Flynn told the Chamber of Commerce conference. “Opening up the Open Skies agreements in this case, we think, sets a very bad precedent.”
Aaron Karp firstname.lastname@example.org