Emirates fires back at Delta in airline subsidy flight

Emirates fires back at Delta in airline subsidy flight

Emirates Airline is firing back at Delta Air Lines in a fight over foreign airline flight subsidies that has roiled the nation's aviation industry. 

Delta has blamed alleged subsidies to Middle Eastern airlines, like Emirates, for a cutback on its flight service to Dubai. 

An Emirates spokesman said Tuesday that Delta is making a "political play" with the accusation that it's being negatively affected by the presence of Middle Eastern carriers at U.S. airports. 

ADVERTISEMENT

"Delta has no head-to-head competition as they are the only airline to operate non-stop on this route," the official said in a statement provided to The Hill. 

"Industry data shows that average seat loads on Atlanta-Dubai has been consistently more than 85 percent, which clearly indicates that consumer demand or overcapacity is not the issue," the Emirates statement continued. "It is of course Delta’s prerogative how they wish to allocate their fleet to routes, but their attempt to pin the blame on the 'Gulf carrier threat' is plainly a political play, or a thin excuse to prop up fares at a higher level by limiting capacity." 

The fight over foreign airline subsidies has become a turbulent battle that has engulfed the nation’s aviation industry.

Major U.S. airlines like Delta, United and American, known as the Big Three, have accused Persian Gulf carriers like Qatar Airways, Etihad Airways and Emirates of receiving billions of dollars in subsidies since 2004. 

Delta said Monday that it is eliminating daily flight service from Atlanta to Dubai, beginning Oct. 1, and moving to a four- or five-times-per-week schedule for the fall and winter. 

A Delta spokesman blamed the cutback on alleged subsidies that have been received by Middle Eastern airlines that U.S. airlines argue is giving their competitors an unfair business advantage. 

"The reduction comes amid overcapacity on U.S. routes to the Middle East operated by government-owned and subsidized airlines," Delta spokesman Trebor Banstetter said in a statement included in the report. 

Emirates said in its statement on Tuesday that the number of customers on its flights illustrates there is demand for more service to places like Dubai. 

"The high average seat load factors of more than 80 percent on our USA services illustrates the consumer demand for our high-quality services to Dubai, and our ability to connect US travelers and cities to many other points on our global network including more than 50 cities not served directly by any American carrier," the company said. 

The major U.S. airlines have said the alleged payments to Middle Eastern competitors violate the spirit of the Open Skies agreements between the U.S. and the governments of Qatar and the United Arab Emirates, which owns the Gulf airlines. They want the Obama administration to launch a review of the claims with the Middle Eastern governments, which would involve a delicate set of negotiations that critics have said would upset other areas of foreign relations.

The Gulf carriers have denied violating the Open Skies agreements, and they have argued that U.S. airlines have historically received subsidies from the federal government at times of distress, such as the period after the Sept. 11, 2001, terrorist attacks. 

Travel industry and consumer groups have accused the airlines of trying to reduce competition for international flights. 

Unions that represent major U.S. airline workers, meanwhile, have formed campaigns to pressure the Obama administration to question the Persian Gulf carrier subsidies.

“Emirates is clearly out-of-touch with reality because load factors aren't an accurate indicator of flight profitability," a spokeswoman for one such campaign, known as the Partnership for Open & Fair Skies, said in a statement.

"The fact is that Emirates received $6.8 billion in subsidies and unfair benefits from the United Arab Emirates government, which is causing the U.S. airlines to lose passengers and cut international service," the spokeswoman, Jill Zuckman, continued. "Emirates willfully ignores cold, hard evidence of massive subsidies that have allowed it to expand far beyond what market forces could ever support, distorting international competition and tilting the playing field to its advantage.” 

-This story was updated with new information on Aug. 12 at 9:37 a.m.