Mayor Of Fort-Worth Sides With American In Open Skies Dispute

In other news the Pope says he’s a Catholic, Le Bron says he’s partial to a game of Basketball and McDonalds tell us they like a Big Mac now and then.

Does anyone think this mayor was ever going to come out with a different opinion?

Let’s take a look at what may be swaying the Mayor’s opinion on this. Could it be the facts or, just possibly, could it be American’s presence in the Mayor’s area?

From AA.com:

• American Airlines Corporate Headquarters Campus – Located in two modern office buildings along Amon Carter Boulevard in Fort Worth’s CentrePort commercial park, American’s Headquarters occupies a total of about 1.4 million square feet and is home to more than 4,300 employees.

• American Airlines Training and Conference Center – The American Airlines Training and Conference Center is located in the Dallas/Fort Worth area……

• [American Airlines] Integrated Operations Control Center – Located in a three-story building near DFW Airport (that’s Dallas Fort-Worth Airport in case you weren’t sure).

• American Airlines C.R. Smith Museum – …..just south of Dallas/Fort Worth International Airport.

Anyone spotting a pattern?

According to the Dallas Business Journal, Fort-Worth Mayor Besty Price has “joined a growing number of major-market mayors in calling on the U.S. government to address what the city leaders view as violations of Open Skies policies by three state-owned Middle Eastern airlines.”

In case you’ve somehow missed this row (that’s been going on for quite a few months), the crux of the issue is that the big three US Airlines (US3 – American, Delta and United) are claiming that the big three Middle Eastern Airlines (ME3 – Emirates, Etihad and Qatar) received, and are still receiving, unfair benefits from their nations’ governments.

This battle between the airlines has been ongoing for a while now and it shows no real sign of letting up. This idea that the ME3 have some sort of unfair advantage over US carriers is nothing short of laughable.

For a start, the three biggest US airlines have been through Chapter 11 bankruptcy which gave them protection from creditors while they attempted to get their houses in order. This is protection that almost no other airlines in the world are privy to and almost certainly saved them all from going out of business.

Not only did the US airlines get bankruptcy protection but, in some cases, they also foisted the burden of their pension schemes onto the US tax payer (United, I’m looking at you!). If that isn’t a benefit from your nation’s government what is?!

On top of all this, the whole US airline industry is one big subsidy merry-go-round. As View From the Wing pointed out back in April:

“The very first large aircraft order by American Airlines was subsidized by the Reconstruction Financial Corporation. It was hardly a coincidence that future Democratic administration Secretary of Commerce C.R. Smith, then chairman of American Airlines, was best man in FDR’s son’s wedding.”

“Delta Airlines and United both have their substantial Tokyo operations as a result of the spoils of World War II.” – I’m pretty sure that can be classed as a “benefit from your nation’s government”

“Delta has an oil refinery in Pennsylvania that received nine-figure tax breaks.” – more “benefits” from Delta’s government.

As if that wasn’t enough, the Congressional Research Service wrote a paper, back in 1999, detailing the $150 billion that the US government had spent between 1918 and 1998 supporting the US aviation industry (thanks to VFTW for pointing this out and to Wikileaks for archiving the document here).

Before you think that it ends there, it doesn’t. All three of the big US airlines fly to airports that are almost completely propped up by local government subsidies. The airlines are, in effect, being paid to fly to these cities – and, yes, they do make money on those flights.

But the hypocrisy surrounding the subsidies isn’t the funniest thing about this story. What’s even funnier is the hypocrisy you’ll find when you take a closer look at the protagonists in this battle.

American Airlines is not only part of the US3 but also part of the OneWorld Alliance….as is ME3 “member” Qatar Airways – so it appears that American isn’t shy about attacking one of it’s own alliance partners with whom it shares routes and presumably some revenue here and there?

It’s not just American’s alliance partners that aren’t safe from attack, their codeshare partners get it in the neck too. American has codeshare agreements with Etihad (another illustrious member of the ME3) and they even announced a strengthening of that codeshare just 4 weeks ago!

If you dig a bit deeper is gets even more interesting. Back in January Qatar Airways bought a 10% stake in IAG, the parent company of British Airways. And British Airways has the most powerful transatlantic joint operating agreement (i.e revenue sharing agreement) with….you guessed it…American!

All of this just leaves a bit of a bitter taste in the mouth. The arguments got beyond stupid when the CEO of Delta managed to drag the memories of 9/11 into the debate (he should have been forced to resign at that point IMO) but it’s the utter hypocrisy of the US airlines that raises my blood pressure.

The CEOs of the US3 are almost constantly in the media bleating on about the “unfairness” of it all while all along they have been some of the biggest beneficiaries of state aid, local government hand outs and cronyism. At what point do they look in the mirror and actually feel some shame?

Here’s a suggestion, perhaps if they spent more time (and more of the hand outs they’ve been receiving) on improving their often pathetic services they may not have to fear competition from the ME3.

But then again perhaps that sounds like too much effort? Much easier to pay lobbyists to lobby the government and to spin information in a pathetic attempt to ward off competition.