Unfair airline subsidies: US government hears the $40 billion claim

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Written by Linda Hohnholz

The US government wants comments from interested parties about US airline and unions’ claims that Gulf carriers including Emirates, Etihad, and Qatar Airways have received market-distorting subsidies.

The US government wants comments from interested parties about US airline and unions’ claims that Gulf carriers including Emirates, Etihad, and Qatar Airways have received market-distorting subsidies.

“The US government takes seriously the concerns raised,” the US Departments of State, Commerce, and Transportation said in a joint statement. The review of submitted materials is expected to begin by the end of May.

US carriers and unions allege that Emirates Airline, Etihad Airways and Qatar Airways benefit from more than $40 billion in state subsidies that have allowed them to drive down ticket prices and begin pushing US airlines out of key markets. They have called on the Obama administration to request consultations on the matter with those airlines’ home governments, the United Arab Emirates and Qatar.

The Gulf carriers have denied the subsidy allegations and said US airlines’ worse service has caused them to lose market share.

American Airlines Group Inc., Delta Air Lines Inc. and United Continental Holdings Inc. submitted the claims about subsidies.

All material received by the interagency team will be made public, unless the departments approve requests by interested parties, if any, to keep particular information confidential, the Obama administration’s statement said.

“We are pleased that the US government is taking the next step to further examine the issue,” Jill Zuckman, spokeswoman for the US airline and unions’ group, said in a statement. “This process is an opportunity for more transparency and we urge the Gulf carriers to adhere to the same standards of financial disclosure and accountability as the US carriers.”

Etihad Airways pointed out in a statement that this UAE carrier is securing hundreds thousands of jobs in the United States hinting perhaps these jobs may be in danger if ruled negative by the US government.

Todayโ€™s Etihad Airways statement reads:

Etihad Airways applauds the US Government for setting up a transparent process to deal fairly and responsibly with the claims made by the three largest US airlines that three Gulf carriersโ€Ž, including Etihad, are receiving government subsidiesโ€Ž. We hope that no one will pre-empt this process or prejudge its outcome.

Etihad Airways is committed to setting the record straight regarding these unsubstantiated allegations. However, so far the US airlines have failed to provide the complete details and data supporting these claims to Etihad Airways. Only with all of this information available to us can we provide a full response.

Etihad Airways is proud to operate US-manufactured Boeing aircraft and serve six US gateway cities, driving billions of dollars in US economic activity and supporting hundreds of thousands of US jobsโ€Ž.

About the author

Avatar of Linda Hohnholz

Linda Hohnholz

Editor in chief for eTurboNews based in the eTN HQ.

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