Executives from American Airlines and Lufthansa complained about an unlevel playing field with Arabian Gulf carriers, during a session at the World Travel and Tourism Council’s Global Summit in Dallas.
Karl Ulrich Garnadt, a member of Lufthansa’s executive board, said the situation is particularly difficult for European airlines.
“Scott, you ain’t seen nothing yet with regards to the Gulf carriers,” Garnadt said, addressing AA President Scott Kirby.
Garnadt said that in Europe, Gulf carriers operate seven times the capacity of European carriers between the Gulf and Europe, and that virtually all traffic between Europe and South-east Asia is dominated by the Gulf carriers.
“And there is no end to this development,” Garnadt said.
The Big Three U.S. airlines have publicly alleged that the Gulf carriers — Etihad, Emirates and Qatar Airways — are heavily subsidised by their governments.
Kirby sought to prove that point by saying he had found a published Etihad fare of $48 for a flight between New York and Mumbai this summer, which after fees came to $680 round trip.
“It costs way more than that to fly to a market like that,” he said. “Fair trade requires fair competition. We like Open Skies but we can’t compete with $50 billion in subsidies.”
American, Delta and United have petitioned the U.S. government to freeze the Gulf carriers’ growth in the U.S., saying that the Gulf airlines are unfairly subsidized.
James Hogan, president of Etihad, was originally slated to be on the panel, but he was absent.
Published on Travel Weekly Asia.