Delta CEO: Persian Gulf countries unfairly aid airlines

Leonard N. Fleming
The Detroit News

The leader of Delta Airlines on Tuesday said airlines in two Persian Gulf countries are being unfairly subsidized by their governments and threatening U.S. jobs.

In a lunchtime speech to the Detroit Economic Club, Delta CEO Richard Anderson called on President Obama to curtail the flights in and out of the U.S. by three foreign airlines until Qatar and the United Arab Emirates comply with the Open Skies agreement to ensure fair competition for the U.S..

Government subsidies from the two Gulf countries totaling $42 billion for Qatar Airways, Etihad Airways and Emirates Airline have allowed them to significantly expand their fleet and international routes without regard for profitability, Anderson said, and that hurts airlines operating in the American marketplace.

The U.S. has signed more than 100 Open Skies agreements with other countries since 1992, allowing each country's carriers free and open access to the other country's markets.

"We support Open Skies. We support open and free trade, but in this instance we have bilateral agreements that are being violated by those countries," Anderson said. "I think Detroit particularly understands the dangers of not supporting trade agreements. I don't think any of us support inequitable trade."

Delta officials claim that every roundtrip international flight lost by a U.S. carrier "due to unfair competition with the government-subsidized Gulf carriers" cost more than 800 jobs in the States.

"The facts are pretty straight forward," Anderson said. "We believe our government can take reasonable steps to level the playing field."

Those steps would include freezing any new passenger service to the U.S. from Qatar and the UAE.

In a wide-ranging speech, Anderson also said he opposed efforts to privatize air traffic controllers.

He also predicted that "the future is bright" in terms of Delta's relationship with Metro Airport.

Under Anderson's leadership, Delta has managed record profits dating from when the airline emerged from bankruptcy and improved its customer rating to have the highest among the big U.S. carriers.

Anderson called Metro Airport "the best airport facility in the world"

"It's a real gem in our system," he said.

He said Delta expects to add more wide-body planes to its fleet and expand the number of flights out of Metro to Asia.

Thomas Naughton, CEO of the Wayne County Airport Authority which runs Metro Airport, agrees with Anderson that federal agencies should investigate whether the Open Skies agreement was violated and has written to U.S. Sens. Debbie Stabenaw and Gary Peters in support of the agreement.

"Open Skies agreements have been wonderful for Detroit, for the whole U.S. aviation industry, and it's critically important for all the parties to play on a level playing field," Naughton said. "We hope the State Department and the Department of Transportation and Commerce take a look at this. And they'll do the right thing, I'm sure."

Naughton said he agrees with Anderson who told the crowd he opposes a move being discussed in Congress that would privatize air traffic controllers and remove them from the Federal Aviation Administration.

"The FAA, when it comes to air traffic control, they really do a very, very good job," Naughton said. "There are some wonderful professionals inside the FAA throughout that organization. Their top priority is safety. It's really not something that I would want to see delegated, or assigned or subcontracted out to a private entity. It's just too important."

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