Dubai: The UAE’s two largest airlines are set to respond in Washington DC on Tuesday to accusations that they receive billions of dollars in state subsides, a breach of an open skies agreement with the US.
Emirates and Etihad Airways are responding to allegations made by the US’ largest airlines, Delta, United, and American, last month that they, along with Qatar Airways, have benefited from over $40 billion (Dh147 billion) in state subsidies over the past 10 years.
The US airlines, claiming that the Gulf carriers are eating at their market share, have called on the White House to review the open skies agreement with the UAE and Qatar because.
Etihad Airways President and Chief Executive James Hogan spoke late evening UAE time at a US Chamber of Commerce sponsored aviation event where, in an apparent counter of the allegations, said the airline receives “equity investments and shareholder loans.”
Emirate airline President Tim Clark will address the press in the US capital hours later where he is expected to address the allegations.
The UAE airlines, and Qatar Airways, have historically denied they receive state subsidies and instead argue that their better product and service is taking market share from the US airlines.
“This is ultimately all about consumer choice. Customers choose to fly Etihad Airways because we offer a great product, with outstanding service, on the routes they want to fly, at prices that are competitive within those markets,” Hogan said in an Etihad Airways statement.
Lufthansa Group Chief Carsten Spohr, who spoke at the same event as Hogan, reportedly warned that an “oligarchy” of Gulf carriers could “destroy” its competitors.
Spohr called on bilateral agreements with the UAE and Qatar to be reviewed and renegotiated.
