The big three U.S. airlines — American, Delta and United — have long claimed that massive subsidies from the UAE and Qatari governments unfairly prop up Emirates, Etihad Airways, and Qatar Airways. Now they’re saying it’s bad for U.S. national security as well.
They make their claim in a new white paper by the Partnership for Open and Fair Skies, a group that represents the airlines and various labor unions.
“By enabling the Gulf carriers to flood the marketplace with massive subsidized capacity, Gulf subsidies will drive U.S carriers off international widebody routes, thus reducing the U.S. carrier widebody fleet and eroding the ability of U.S. carriers to support the U.S. military under [the Civil Reserve Air Fleet] during times of national emergencies,” the white paper says.
The Civil Reserve Air Fleet is a group of aircraft owned by U.S. passenger and cargo airlines that the military can charter or even press into service in wartime. Each member airline, including American, Delta, United, FedEx, UPS, Atlas, and others, makes available a specific number of planes to the fleet, which is overseen by the Pentagon’s U.S. Transportation Command. Currently, the Civil Reserve Air Fleet offers the military access to 217 long-range international passenger aircraft, said TRANSCOM spokeswoman Cynthia Bauer.
The Pentagon regularly charters these aircraft to move troops and equipment around the United States and around the world. For example, when soldiers deploy to Afghanistan, they are often flown on chartered aircraft to Romania, Kuwait, or other bases in the Middle East before boarding military cargo planes to their final destination. And twice in recent decades, the military has called large numbers of the planes into service: once in the runup to the 1991 Gulf War and again before the 2003 U.S. invasion of Iraq.
The U.S. airlines say that the UAE and Qatari subsidies allow the three Gulf carriers to charge lower airfares, offer better services and amenities, and fly newer and often larger aircraft such as the Boeing 777 and the Airbus A380 double-decker super jumbo jet. This has forced the U.S. carriers to stop flying certain air routes, the airlines say, and could eventually shrink the pool of widebody aircraft available to the Civil Reserve Air Fleet.
The airlines want the U.S. government to renegotiate the bilateral agreements with UAE and Qatar that govern airline operations — and halt the foreign airlines’ addition of new routes until new deals are hammered out. (Such “open skies” agreements are negotiated by the State Department; currently, the U.S. has such pacts with more than 100 nations.) They have found at least a preliminarily willing ear in the Obama administration, which last month invited interested parties to give their comments about changes they would like made to the agreements.
Both UAE and Qatar are major U.S. military allies and host thousands of American forces and equipment in their counties. Qatar’s Al Udeid Air Base near Doha is home to the U.S. Air Force’s combined air and space operations center, which oversees the coalition airstrikes on ISIS targets in Iraq and Syria as well as the NATO warplanes flying missions over Afghanistan. UAE’s Al Dhafra near Abu Dhabi hosts American spy planes, tankers and fighter jets.
The white paper argues that this airline trade dispute ought not harm bilateral relations with UAE and Qatar. “The U.S. should address its trade disputes in proper commercial channels – as the Open and Fair Skies Coalition has advocated — while maintaining an unwavering commitment to the national security of U.S. interests and allies,” it says.
But veteran analyst Richard Aboulafia of the Teal Group calls the whole argument hogwash.
“You can add up all the acquisition trends of all three major Gulf carriers for the next decade or two and even if you assume that somehow — incredibly — a third is coming out of the hides of U.S. players, that’s still not enough to have any impact whatsoever on national security,” Aboulafia said.
Collectively, American, Delta, and United fly hundreds of widebody Boeing 747s, 767s, 777 and 787s, as well as Airbus A330s. The U.S. carriers are also buying lots of new Boeing 777s, 787s and Airbus A350s.
The real competitive tension has been against legacy European and Asian air carriers. “Yes, [the European carriers] have been hurt, but they have survived,” Aboulafia said. “It’s starting to have an impact on the margins against U.S. carriers.”
“Is it something they should watch from a competitive basis? Sure,” he said. “Is it something they might want to pursue trade action? Obviously, they are. But this angle is just bizarre.”