Emirates: Our US Routes Are Profitable
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Emirates Airlines has disputed a report commissioned by the big three U.S. airlines that it is losing money on its U.S. routes.
“There is no truth to the claims that our US routes are unprofitable,” an Emirates spokesman said in a statement provided to TravelPulse.com. “We see consistently high demand for our U.S. routes, driven by the increasing appetite for international travel, Emirates’ strong product and service proposition, as well as our network connectivity. Emirates has grown its operations in the U.S. on the back of that commercial demand.”
The majority of flights to the United States by Emirates, Etihad Airways and Qatar Airways lose money, according to a new report by an independent aviation economics firm.
The findings, by GRA, Incorporated, show that of the 23 routes operated by the Gulf carriers to the United States in 2014, 19 have lost money. The combined losses for the three carriers on these routes average -14.4 percent, with more than half of the routes showing losses of more than 20 percent.
The report was commissioned by the Partnership for Fair & Open Skies, the umbrella group for American, Delta and United airlines. The Partnership believes the Gulf airlines have accepted $42 billion over a 14-year period from their respective governments and is asking the U.S. government to request consultations with the UAE and Qatar to re-open the Open Skies agreements.
“It is clear that in their quest for protection against competition, Delta, American, United and their proxies will not hesitate to promulgate untruths, and fabricate “research” and “white papers” based on inaccurate facts and leaps of logic. Instead of wasting more time and resources to rebut their latest so-called research, we would rather focus on serving our customers,” Emirates said in the statement.
In the report, titled Gulf Carrier Profitability on U.S. Routes, the authors conclude that “our findings indicate that the three carriers have over-expanded in U.S. markets beyond levels one could justify from the operating results. No individual Gulf carrier shows profits on more than 30 percent of the markets it operates to the U.S. The loss margins in many markets would not be sustainable for a private company, nor would a private company be planning to expand in this theater.”
Emirates said it already addressed the allegations made against it to the U.S. government agencies reviewing the matter. “Emirates’ success and business model has been studied and is well-documented by industry analysts; and our fully audited financial statements, published annually for over two decades, consistently validate the fact that Emirates is a profitable airline run on a fully commercial basis,” it said.
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