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‘Ugly’ airline row threatens UAE-U.S. govt ties, says business group

President of U.S.-UAE Business Council said ‘nasty’ subsidy allegations made by American carriers could mar government relations

Published: Updated:

The ongoing spat between the biggest American and Gulf airlines threatens to mar the close relationship between the U.S. and UAE governments, the head of a Washington-based business council has warned.

American Airlines, United and Delta have accused Qatar Airways and the UAE’s Emirates and Etihad of receiving unfair government subsidies amounting to $42 billion over 10 years – claims the Gulf carriers strongly deny.

The escalating war of words over the issue threatens relations at a governmental level, warned Danny Sebright, president of the non-profit U.S.-UAE Business Council.

“We are worried that the favor and goodwill between the [U.S. and UAE] governments might be affected,” Sebright told Al Arabiya News.

The council was launched in 2007 to advocate for increased trade between the U.S. and UAE. The Emirates stands as the United States’ top export destination in the Middle East and North Africa, with $24.9 billion in overall trade being registered between the two countries in 2014.

But Sebright signaled his concern that the “very close relationship” between the U.S. and UAE could suffer due to the high-level row between the American and Gulf airlines.

The president of the 120-member council recalled the Dubai Ports World controversy of 2006, when Republican U.S. officials rejected the sale of port-management businesses covering six major U.S. seaports, which were previously foreign owned, alleging that the sale to the Dubai company could compromise U.S. national security.

“Just like what happened with Dubai Ports World, if this continues and continues, and if the U.S. airlines continue to be so ugly, and nasty in their public campaign, we worry that it could affect the UAE government view of the U.S. in the future,” Sebright said.

Sebright, who previously described comments linking the Gulf airlines to Sep. 11 as “disappointing and irresponsible,” said the U.S. airlines are making “a mountain out of a molehill” to pursue their own agendas.

He added: “I think they are trying to get attention of the U.S. government to fix other problems in the transportation system in the United States by pointing the fingers at Gulf Arabs, because they know they are close friends and allies.”

War of words

The row between the six airlines is escalating, with allegations of unfair subsidies flying on both sides of the Atlantic.

Qatar Airways boss Akbar Al Baker, speaking to Al Arabiya News earlier this month, described Richard Anderson, the head of Delta Air Lines, as “bully” and a “liar” in making allegations of unfair subsidies.

Emirates president Tim Clark meanwhile has asked his U.S. counterparts whether they will resign after making the allegations, vowing to smash their claims with “a sledgehammer” in an upcoming rebuttal.

Clark also said recently that Emirates might expand further from European hubs into the U.S., saying that “the kind of abuse we’ve been getting might cause us to do it.”

The chief executives of the three U.S. airlines on Friday made a rare public appearance together at the National Press Club in Washington to detail their claims.

American Airlines’ Doug Parker said Emirates, Etihad Airways and Qatar Airways have expanded services to the U.S. by 25 percent since the dispute broke out in January, accusing them of rushing to do this before the U.S. government blocks new flights.

Seven U.S. mayors recently sent letters to the Obama administration, backing the U.S. airlines’ claims that the Gulf carriers have violated Open Skies policy, risking hundreds of thousands of American jobs. They also called on the U.S. government to open consultations with Qatar and the UAE.

‘Half-truths’

Sebright said however that the U.S. airlines had been “using half-information, half-truths to get everybody nervous”. Sebright urged U.S. airlines to start competing instead of pouring their money campaigning against Gulf airlines. He said the council believes that the U.S. airlines spent more than $3 million “for this campaign to criticize the UAE airlines,” citing sources from the campaign.

“If they just [spent the $3 million] on improving the service, making their seats better, making their flight attendants more polite, nice and friendly, we believe they could compete head-to-head with UAE airlines,” he said.

Laura Glading, national president of the Association of Professional Flight Attendants (APFA), rejected Sebright's criticism.

“American flight attendants are consummate professionals and we prove that every day by ensuring the safety and comfort of our passengers,” she told Al Arabiya News.

“Gulf carriers seem to believe that subjugated flight crews are 'more polite, nice and friendly' and suggest American carriers should follow their lead. Let's be clear: passengers are not shifting to Gulf carriers because Western freedoms have made flight attendants unpleasant. Emirates and Etihad are taking our beloved customers for the simple reason that their massive and unfair subsidies allow them to distort the market in violation of Open Skies policy," Glading added.

Jill Zuckman - spokesperson for the Partnership for Open and Fair Skies, which represents United, Delta and American airlines - said Sebright was “name calling”.

“It is unfortunate that Mr. Sebright is attacking the hard-working men and women of the U.S. aviation industry in an effort to distract from a very serious violation of Open Skies policy by the UAE and Qatar,” she told Al Arabiya News.

“Our two-year investigation found that these governments are subsidizing Emirates, Etihad and Qatar airlines to the tune of more than $42 billion,” she added.

“That is why we have asked the United States government to meet with officials from the UAE and Qatar to address these violations and it is why we are asking for a freeze on additional flights coming to the U.S. This is a very serious matter and name calling by Mr. Sebright won't make it go away.”