Qatar Airways CEO Taunts Delta While Announcing New Flight

by Josh Lew
Last updated: 11:30 AM ET, Mon March 14, 2016

Photo courtesy of Qatar Airways

Qatar Airways is challenging U.S. legacy carriers on long-haul routes that connect the Gulf states with the East Coast. A daily Doha-Boston flight will begin later this week, and Qatar has just announced a flight from Doha to Atlanta that is scheduled to start on June 1.

In announcing the Doha-Atlanta service, Qatar Air CEO Ali Al Bakar taunted Delta Airlines, which only recently shelved its Atlanta-Dubai flight. Al Bakar said that his new flight would "rub salt in the wound" caused by Delta's failed Middle East route.

Unfair competition?

This is not a new issue. When it canceled its Dubai service, Delta released a statement saying: "The cancellation of nonstop service between Atlanta and Dubai comes amid overcapacity on U.S. routes to the Middle East operated by government-owned and subsidized airlines."

In fact, subsidies received by Gulf carriers have been the subject of criticism from a number of airlines in the United States and in Europe. The Partnership for Fair and Open Skies has been vocal about the Gulf carriers' subsidy-based business model as it advocates for greater protection for the interests of America's Big Three airlines.

What about Open Skies?

A Partnership for Fair and Open Skies spokeswoman did not mince her words when responding to the "salt in the wound" comment made by Qatar's CEO: "Mr. Al Baker has made it crystal clear that the subsidies his airline receives from the government of Qatar allow him to fly routes for the sake of petty peevishness rather than rational, market-based reasoning… Of course, with $17.5 billion in subsidies, Mr. Al Baker can choose to fly anywhere, anytime - even if his flights lose money and make no economic sense."

Qatar continues to expand

Even amidst these complaints and criticisms, Qatar Airways continues to expand in the United States. In addition to its coming Boston and Atlanta flights, it will add a second daily service from Doha to New York JFK next month.

The three U.S. legacy carriers have found themselves at odds recently over issues such as the privatization of America's air traffic control infrastructure. However, they all agree on the challenge posed by these heavily subsidized outsiders. Delta and its peers have been trying to get Washington to agree that Emirates, Etihad and Qatar are violating Open Skies agreements when they fly to the United States because their subsidies create an unfair advantage.

No action by Washington

Thus far, these complaints have not led to the announcement of any restrictions or even warnings being issued by the U.S. government. Perhaps with this latest round of verbal sparring, Qatar's CEO is seeing how far he can push before he gets some sort of response from Washington.

Airlines in Europe have made similar complaints against their Middle Eastern rivals, and there is now a movement by the European Commission to change the way that air agreements are made. The idea is to require every nation whose air space is used for a flight (between, say, Doha and London, for example) to approve any agreement between two countries before it could be signed. This could be used by European countries as a strategic tool to limit the expansion of Gulf carriers on the continent.

For now, however, Qatar and its peers seem to have the edge on long haul routes between the United States and the Gulf.

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