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U.S. government to investigate subsidies to Emirates, Etihad and Qatar Airways

U.S. government to investigate subsidies to Emirates, Etihad and Qatar Airways

Old Mar 20th 2015, 8:51 am
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Default U.S. government to investigate subsidies to Emirates, Etihad and Qatar Airways

This is interesting. Those airlines are very important to Dubai, Abu Dhabi and Qatar. I would say their "brand ambassadors" to the world.

U.S. to chart new territory in Gulf airline subsidy review | Reuters

It seems Uncle Sam is unhappy about subsidies the sheikhs might be giving to those airlines resulting in unfair competition to the American (and also European) airlines.

Does anyone here work for any of them?

(Reuters) - The Obama administration said Wednesday that it is in the early stages of studying claims that Gulf airlines have received market-distorting subsidies, a review involving uncharted territory for the U.S. government.

No international trade rules or precedent by the United States exists for addressing airline subsidy claims, presenting a challenge for the administration as it determines how to proceed, a person familiar with the matter said. U.S. airlines contend that Gulf carriers can lower prices and offer more amenities on newer planes because of state subsidies.

These issues do not fall under World Trade Organization rules but rather under bilateral "Open Skies" agreements that authorize commercial flying between countries.

The agreements are silent on how to handle most subsidy claims, the source said. Yet alleged subsidies of more than $40 billion to Gulf airlines make the claim the largest that the administration has encountered and must be taken seriously, the source added.

Last week, the administration asked U.S. airlines some 20 questions about the allegations.

"The (U.S. government) interagency team did in fact ask the U.S. airlines and their consultants several technical and clarifying questions about the data and information contained in their report," U.S. Department of Transportation Press Secretary Ryan Daniels said in a statement, confirming a Reuters report.

"However, we are in the early stages of thoroughly reviewing this matter in close coordination with our interagency partners," he said.

The Obama administration has filed trade complaints on issues ranging from China's imposition of extra duties on American cars to India's ban on certain U.S. agricultural goods to allegedly protect against avian influenza.

Aviation also has been at the center of a decade-old dispute in which the World Trade Organization found that planemakers from the United States and the European Union had received illegal subsidies.

But Geneva-based watchdog's rules do not apply to air traffic rights or airline services, although it keeps these under review broadly.

Meanwhile, the dispute between U.S. and Gulf airlines has escalated.

On Tuesday, Emirates airline President Tim Clark promised to rebut the allegations, while Etihad Airways Chief Executive Officer James Hogan said the company received loans, not subsidies, from its government shareholder. Both had arranged meetings with Obama administration officials.

Delta Air Lines (DAL.N), United Airlines (UAL.N), American Airlines (AAL.O) and their unions on Wednesday called on the administration to request a freeze on additional Gulf-airline flight departures to the United States.
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Old Mar 20th 2015, 11:48 am
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Default Re: U.S. government to investigate subsidies to Emirates, Etihad and Qatar Airways

Originally Posted by NewCaledonia View Post
This is interesting. Those airlines are very important to Dubai, Abu Dhabi and Qatar. I would say their "brand ambassadors" to the world.

U.S. to chart new territory in Gulf airline subsidy review | Reuters

It seems Uncle Sam is unhappy about subsidies the sheikhs might be giving to those airlines resulting in unfair competition to the American (and also European) airlines.

Does anyone here work for any of them?
So one airline president "promises to rebut" the allegation, and another says they're loans not subsidies. In other news, I'm definitely never again going to drink as much as I did last night, until next time.

Anyway, it's a bit rich of the US--perhaps they should take the lump of 4x2 out of their own eye before try to take the splinter out of someone else's (big splinter, mind).

That aside, it'll be an interesting spectacle to behold.
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Old Mar 20th 2015, 1:25 pm
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Default Re: U.S. government to investigate subsidies to Emirates, Etihad and Qatar Airways

Originally Posted by Bahtatboy View Post
So one airline president "promises to rebut" the allegation, and another says they're loans not subsidies. In other news, I'm definitely never again going to drink as much as I did last night, until next time.

Anyway, it's a bit rich of the US--perhaps they should take the lump of 4x2 out of their own eye before try to take the splinter out of someone else's (big splinter, mind).

That aside, it'll be an interesting spectacle to behold.
exactly the US is only happy when its the only one allowed to prop up its piss poorly airlines and airline manufacturers. Every thing else is just unfair competition
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Old Mar 20th 2015, 1:35 pm
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Default Re: U.S. government to investigate subsidies to Emirates, Etihad and Qatar Airways

Originally Posted by shiva View Post
exactly the US is only happy when its the only one allowed to prop up its piss poorly airlines and airline manufacturers. Every thing else is just unfair competition
The US and UK are two of the few countries with open skies policies with the UAE and Qatar.

Canada, France, Germany or Australia don't have such policies. I suspect the US carriers just want to limit the number of flights of those carriers into the US.

That will be an issue for Emirates or Qatar in order to grow.
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Old Mar 20th 2015, 5:38 pm
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Default Re: U.S. government to investigate subsidies to Emirates, Etihad and Qatar Airways

Originally Posted by NewCaledonia View Post
The US and UK are two of the few countries with open skies policies with the UAE and Qatar.

Canada, France, Germany or Australia don't have such policies. I suspect the US carriers just want to limit the number of flights of those carriers into the US.

That will be an issue for Emirates or Qatar in order to grow.
its certainly a big issue and being disguised under "fair competition"
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Old Mar 20th 2015, 8:04 pm
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Default Re: U.S. government to investigate subsidies to Emirates, Etihad and Qatar Airways

Originally Posted by shiva View Post
its certainly a big issue and being disguised under "fair competition"
Well you can say it is common sense.

The US and the European Union have Open Skies because they are somehow "equal".

However, Qatar and the US. What is the advantage that the US has having open-skies policies to Qatar?
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Old Mar 21st 2015, 4:20 am
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Default Re: U.S. government to investigate subsidies to Emirates, Etihad and Qatar Airways

Originally Posted by NewCaledonia View Post
Well you can say it is common sense.

The US and the European Union have Open Skies because they are somehow "equal".

However, Qatar and the US. What is the advantage that the US has having open-skies policies to Qatar?
Keep your enemies closer and all that! We give you open skies, you stop giving money to people we're trying to kill.
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Old Mar 21st 2015, 9:03 am
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Default Re: U.S. government to investigate subsidies to Emirates, Etihad and Qatar Airways

Originally Posted by NewCaledonia View Post
However, Qatar and the US. What is the advantage that the US has having open-skies policies to Qatar?
If you're an American, the advantage is that you have a, generally better, alternative to fly around the world versus the US airlines. From the consumer perspective, all these subsidies are great - the Middle Eastern governments are effectively choosing to transfer some oil wealth to US and European citizens in the form of better airline choices.
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Old Mar 21st 2015, 9:57 am
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Default Re: U.S. government to investigate subsidies to Emirates, Etihad and Qatar Airways

Originally Posted by csdf View Post
If you're an American, the advantage is that you have a, generally better, alternative to fly around the world versus the US airlines. From the consumer perspective, all these subsidies are great - the Middle Eastern governments are effectively choosing to transfer some oil wealth to US and European citizens in the form of better airline choices.
Interesting perspective. I would only challenge your choice of words: "choosing" suggests a conscious decision, rather than an unintended consequence of throwing money at something to add it to the list of the biggest, best and most magnificent of its kind.
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