As the row between the US majors and the Gulf carriers rumbles on, it is still unclear how it will end.
Each side disputes the other's accusations regarding subsidies and capacity dumping, and the Gulf airlines remain resolute in their assumption that they are innocent as they continue to arrange expansion across the North Atlantic.
A collision between two such giant objects, each with massive gravitational pulls, is likely to have huge global consequences. The US majors lit the fuse on the dispute, but what is their endgame?
That open-skies deregulation has been very good for everybody – airlines and consumers – is beyond dispute. And it is irreversible.
Emirates Airline chief Sir Tim Clark hopes that sense will prevail, but in the unlikely event that the dispute cannot reach a resolution, he says "the amount of unravelling of global political structures would be incredible".
The subject of the US versus the Gulf carriers came up during September's World Routes event in Durban, where World Travel and Tourism Council boss David Scowsill pointed out that the row is typical of the sort of conflict that exists between government departments. The transportation department will have one view. The commerce department will have another view, he said, predicting that it will end up having to be refereed by the US president.
Scowsill has suggested that when such a conflict erupts, the country's premier must be clear about policy. "Do you support foreign carriers or don't you? Foreign carriers need clarity. National carriers need clarity," he says. "And the investment that airlines and airports require for the future needs that forward-looking visibility over that 20-year timeframe."
In the wake of the 9/11 terrorist attacks, the USA lost $600 billion after the state department clamped down on visas as the commerce department was trying to attract more tourism business. "So the president had to get involved to sort out the dispute between ministries," says Scowsill.
Airline associations often lobby for the so-called "level playing field". But has there ever really been one? Many privatised national carriers were state-owned not so long ago. And they fly from infrastructure created with government support back in the days of Lockheed Constellations and Boeing 707s.
But it is a delicate path the associations must tread. See how the Association of European Airlines has found itself being torn apart as key members leave: namely the part-Etihad-owned Air Berlin and Alitalia, along with British Airways and Iberia – part of IAG, in which Qatar Airways holds a stake.
Air Berlin boss Stefan Pichler told delegates at the recent European Regions Airline Association meeting that its AEA membership had been terminated "due to a conflict of interest in regard to… competition and protectionism. We could no longer adopt the position of the AEA because it was a position of minorities."
Pichler has previously accused the AEA of "allowing itself to be driven by airlines which desperately try to erect a new wall around Europe".
Needless to say, the AEA is dismayed by such accusations.
It is probably no coincidence that Qatar Airways Group chief executive Akbar Al Baker believes that two prominent AEA members, Lufthansa and Air France-KLM, have been egging on their US partners in the dispute "because they cannot stand up to competition".
IATA director general Tony Tyler, who steps down next June, was under pressure to take a position in the dispute at this year's AGM in Miami. He dodged the row by saying IATA "is not a place where airlines come to further or air their aeropolitical differences".
The industry waits with bated breath to see who the association should very soon name as Tyler's successor. Whoever it is, they will have some immediate challenges to deal with to ensure IATA can remain a happy ship.
Source: Airline Business
