The "big three" US airlines have received almost $71.5 billion in government subsidies since 1999, a new study claims.
Research by the independent Risk Advisory Group found that the vast majority of the $71.48 billion granted to American Airlines, United and Delta has been paid since 2000.
The study was commissioned by Etihad, which, together with Qatar Airways and Emirates, faces opposition to expansion plans in the US by the three US carriers.
The Gulf airlines claim their US rivals were granted billions in state aid after the September 11, 2001 attacks and that this counters any argument that they have about the Middle East airlines being state sponsored and receiving beneficial fuel rates.
All three US airlines were allowed to reorganise under Chapter 11 bankruptcy protection after 9/11.
Among the claims in the research are that United benefited from bankruptcy debt relief totalling $26 billion and Delta $4.6 billion, while American received government guarantees worth $6 billion.
In all, Risk Advisory estimates that United benefited by $44.4 billion, Delta by $15 billion and American by $12 billion.
The study also points out that US carriers benefit from a lower rate of federal jet fuel tax — 4.4 cents per gallon instead of 21.9 cents for non-commercial carriers.
Other claims include:
- A total of $761 million was granted to Delta by Minnesota to build a fleet maintenance facility
- American Airlines received $80-85 million in redevelopment funds from the State of Missouri in 2003
- United Airlines received another $6.3 million in tax credits from Colorado
- The report also points out that the US bars foreign airlines from its domestic market and stipulates that government-paid air travel must be on US carriers.
The OpenSkies.travel campaign is calling on the US government not to concur with demands from the three airlines to halt expansion by their Gulf rivals.
OpenSkies.travel founder Kevin Mitchell said: "This report confirms that the United States has found numerous ways to financially help its airline industry become established and profoundly advantage it in ways to enable the most powerful and profitable airlines in the world."
Freezing Gulf carrier access to US markets would be the "mother of all subsidies" and land American consumers with vastly higher fares and much diminished travel options, he added.
The news comes after Qatar Airways CEO Akbar Al Baker dismissed as "baseless" claims by US airlines that the open skies agreement is weighted in favour of Gulf carriers (see news, May 14).
In March, Etihad Airways CEO James Hogan warned against "the dark clouds of protectionism" ending the open skies agreements in place around the world (see news, March 26).
Gary Noakes
