American Airlines has announced that it is discontinuing its codeshare relationships with oneworld partner, Qatar Airways, as well as with Etihad Airways, citing the ongoing dispute over the Open Skies agreements and allegations that the three Middle Eastern carriers receive illegal subsidies.

The big three US carriers – American, Delta and United – have been involved in a sometimes bitter dispute with the big three Middle Eastern carriers – Emirates, Etihad and Qatar – over what the US carriers believe is unfair subsidizing of state-owned carriers by the Gulf states of Qatar and the United Arab Emirates (UAE). These subsidies, they say, result in unreasonably low prices and the crowding out of competition on key routes.

"In light of our ongoing dispute over the Open Skies agreements, American Airlines notified Etihad Airways and Qatar Airways on June 29 of our decision to terminate our code-share relationships." read a statement from American Airlines. "Given the extremely strong public stance that American has taken on the ME3 issue, we have reached the conclusion that the code-sharing relationships between American and these carriers no longer make sense for us. This decision has no material financial impact on American and is an extension of our stance against the illegal subsidies that these carriers receive from their governments."

"We are committed to doing everything we can to continue to support our team members and ensure that there is fair competition between American and the Gulf carriers.", the statement concluded.

The codeshare relationships between American and both Etihad and Qatar will end after the close of business on March 24, 2018.

Etihad Airways stated it was disappointed by American’s actions, stating “We view the decision by American Airlines as being anti-competitive and anti-consumer. This action will reduce choices for consumers and may result in higher fares for travellers to and from the United States. Etihad Airways, the national airline of the United Arab Emirates, is disappointed with the decision of American Airlines to terminate our codeshare relationship effective 25 March 2018.”

Qatar Airways, while not commenting on the ending of the codeshare agreement, has stated that it intends to go ahead with its previously-announced plan to acquire up to a 10 per cent equity stake in American Airlines, an unsolicited offer that American is vehemently against.

"Our stock-purchase request and filing is going ahead as normal," Qatar Airways CEO Akbar al-Baker told reporters in Doha. "We had to clarify certain questions of the regulator, which we compiled with."

"While anyone can purchase our shares in the open market, we aren't particularly excited about Qatar's outreach, and we find it puzzling given our extremely public stance on the illegal subsidies that Qatar, Emirates and Etihad have all received over the years from their governments,", said American Airlines CEO Doug Parker in a letter to AA employees just hours after hearing of Qatar's planned investment.

Qatar Airways already owns a 20 per cent stake in International Airlines Group (IAG) parent company of oneworld partners British Airways and Iberia Airlines.

Al Baker is also taking flak from US airline industry insiders and union officials over remarks the CEO made at a private gala dinner in Dublin last week. A tape of the CEO’s remarks revealed that he had called US carriers “crap” and made sexist and ageist comments about US flight attendants.

“By the way, the average age of my cabin crew is only 26 years,” Al Baker said in the recording. “So there is no need for you to travel on these crap American carriers. You know you’re always being served by grandmothers on American airlines.”

Two US airline unions, the Association of Flight Attendants (AFA) and the Air Line Pilots Association (ALPA), have publically spoken out about the comments, condemning the CEO’s misogynistic remarks.

“Straight from Akbar Al Baker lips, he confirms what AFA has said all along: Qatar Airways thrives on misogyny and discrimination.” AFA president Sara Nelson said in a statement. “Qatar is not only seeking to choke out U.S. Aviation, but also the 300,000 good jobs built through opportunity created on the principle of equality. There is no room for a separation of humanity in air travel or in an emergency. Flight Attendants are onboard to save lives and every life counts. If you prop up Qatar Airways you are supporting sexism, racism and ageism.”

ALPA president Tim Canoll, meanwhile, said in a statement, “The head of Qatar Airways sunk to a new low recently when he disparaged hard-working U.S. crewmembers and airlines that represent $1.5 trillion in economic activity. Akbar Al Baker’s sexist and degrading remarks are an affront to our core values as a country, and he owes U.S. airline workers an apology.”

Al Baker has since issued an apology following the strong backlash.

“I should like to apologize unreservedly to those offended by my recent remarks which compared Qatar Airways cabin crew with cabin crew on US carriers," he said in a statement. "The remarks were made informally at a private gala dinner, following comments about the Qatar Airways cabin service and were in no way intended to cause offense. This is a time of strong rivalry between our airline and the US carriers and we are of course immensely proud of our own cabin crew. However, cabin crew are the public face of all airlines and I greatly respect their hard work and professionalism. They play a huge role in the safety and comfort of passengers, irrespective of their age or gender or familial status. I have worked for many years in the industry, and I have a high regard for the value that I see long-serving staff members bringing through their experience and dedication.”

It should be interesting to see how this all plays out.

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