Airlines & Airports
Delta CEO: '(Gulf Carriers) Are Not Airlines, They're Governments'
Delta Air Lines CEO Richard Anderson (pictured above) continued the debate over Open Skies Agreements, saying the international travel market would be a level playing field if U.S. airlines were competing against fellow airlines.
Speaking today at The Detroit Economic Club, Anderson went so far as to say that Emirates, Etihad and Qatar airlines are “not airlines, they’re governments.”
The big three U.S. airlines – Delta, American and United – have joined forces in their fight against the Persian Gulf carriers, alleging in a 55-page report to the Obama administration that their counterparts from the Middle East have taken a combined $42 billion in government subsidies from 2004 to 2014.
A former CEO at Northwest Airlines before it merged with Delta, Anderson is familiar with Detroit – he and current Mayor Mike Duggan oversaw the inception and construction of the $1.4 billion midfield terminal at Detroit Metro Airport, now considered one of the best terminal buildings in the country. He played to the crowd, and those roots, by equating the airline business to the automotive industry.
“This (unfair trade practice) will resonate with Detroit and the devastating effects the (auto) trade imbalance had with Japan,” said Anderson, calling this debate with the Gulf airlines “our greatest challenge.”
Anderson said it not only compromises the international travel market, but costs U.S. jobs. The Gulf carriers say they aren’t being subsidized, they are receiving investments from their equity partners, which just so happen to be their respective governments.
“The facts are pretty straight forward. We’ve done a fair amount of research. There is no doubt about the subsidies,” Anderson said.
For example’s sake, he noted that the Gulf carriers have a combined 500 widebody orders with Boeing and Airbus for countries about the size of Idaho. China, the world’s most populous country and the world’s second biggest economy, has 60 widebodies on order.
Anderson and Qatar Airways Group CEO Akbar al Baker have been the most vocal of the six chief executive officers, sometimes to their own detriment.
In February, discussing Open Skies on CNN, Anderson committed a major faux pas when he said: "And it's a great irony to have the United Arab Emirates from the Arabian Peninsula talk about that, given the fact that our industry was really shocked by the terrorism of 9/11, which came from terrorists from the Arabian Peninsula, that caused us to go through a massive restructuring."
Delta quickly apologized but Emirates rejected the mea culpa out of hand and al Baker has been bickering back and forth with Anderson through the media for months. Just last week, in a press conference at the Paris Air Show to announce a deal between Qatar Airways and U.S.-based Boeing for 14 777s, al Baker said: “As you know, no press conference with Qatar Airways is without controversy, so I would like to make a statement. I hope that the gentleman at Delta knows that we are creating even more jobs in the U.S. by buying these planes.”
Today, Anderson said that the U.S. has Open Skies agreements with 115 countries, “But in this instance we have bilateral agreements being violated by those two countries. … We’re often faced with trade agreements where the other country is state-owned enterprises. They cause a real trade imbalance. We’ve asked the government to enforce our treaties. We have irrefutable proof.”
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