The head of one of the three major Middle East Gulf airlines descends on Washington today to meet with U.S. government officials to discuss allegations of subsidies and the Open Skies Agreement - and he's considering legal action against U.S. carriers.
American Airlines, Delta and United issued a joint 55-page report to Obama administration officials last month, accusing Gulf carriers Emirates, Etihad and Qatar of receiving a combined $42 million in subsidies sine 2004 from their respective governments and tilting the lucrative trans-Atlantic market in their favor.
Emirates Airlines CEO Tim Clark said he will meet with U.S. Department of Transportation officials and go through the report "line by line. They will be eating their words," he told the Financial Times.
The three major U.S. carriers are lobbying administration officials for a review of the Open Skies agreements, which allow airlines from other countries to fly freely without government interference. American, Delta and United contend that Emirates, Etihad and Qatar have created unfair competition by receiving the subsidies - a charge the Middle East carriers have denied.
Separately, U.S. airlines and several powerful unions are also looking to stop Norwegian Air's attempt to create a low-cost trans-Atlantic carrier to the U.S. based out of Ireland, where, they contend, Norwegian can skirt labor laws in its own country.
Clark told the Financial Times that he would ask U.S. official today to be given a "reasonable" amount of time to respond to the allegations.
"I worry about knee-jerk reactions," he told FT.
Clark said, however, that ultimately something with the gravitas of Open Skies agreements would be decided by the respective governments, not by airline CEOs.
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