At the US Chamber of Commerce Aviation Summit this week, United CEO Oscar Munoz voiced strong opposition to Emirates, Etihad and Qatar Airways (ME3).
Those airlines aren’t airlines. They’re international branding vehicles for their countries.
-United CEO Oscar Munoz
In an interview with Carol Hallett, former CEO of what is now Airlines for America, Munoz demonstrated that United will continue its firm stance against Gulf carriers. He added–
Facts tend to overcome a lot of emotion and a lot of bias. There are hundreds of thousands of employees who have been through hell and back in the history of the airline industry here in America, and all of a sudden in the last couple of years they’re enjoying the benefits of an industry that’s doing so well. To start edging away from that, and the potential for an un-level playing field and its competitive impact on their roles, you’re going to have a huge uproar from Americans. If there’s any question about where United stands, we are in the camp of supporting our people.
Of course this answer was in response to a question about Emirates’ new service between Newark and Athens that will directly compete with United Airlines. Competition is never welcomed.
> Read More: Will Emirates Squeeze United Out of Athens?
While I can appreciate WHY he would take that position, Munoz also added quips like ME3 flights having only “20 or 30 people” onboard. I’ve never witnessed anything close to this. While load factors may not be at capacity, I’ve flown my fair share on Emirates, Etihad, and Qatar and have never seen lightly filled flights. I book dozens of Award Expert clients each week on Gulf carriers. The flights are not going out empty. That sort of exaggeration further undermines his argument.
I don’t necessarily disagree with Munoz — indeed, the ME3 are branding vehicles for their countries. But what difference does that make? The issue is competition, not fairness. American partners with Etihad and Qatar. Delta with Saudia. It seems clear to me that the U.S. carriers — United included — are perfectly happy to partner with “the enemy” when it suits them or even seek government subsidies (remember 9/11…). They just don’t want other airlines to use their geographic or organizational advantages against them.
Norwegian: No Problem
Interestingly, Munoz did not express the same level of concern over Norwegian’s aggressive expansion into North America.
Norwegian is being clever … That we can compete with. The [Gulf carriers], we can’t.
But is the issue now competition or protection for USA workers (the old mask U.S. carriers and Airlines for America have traditionally used to justify their opposition to the M3)? If Norwegian is skirting labor rules by incorporating in Ireland and using outsourced FAs, why is that just a matter of competition?
What Will the White House Do?
The unpredictable White House has sent mixed signals on the how it will handle complains over the ME3. While President Trump’s campaign flourished through an aggressive populist stance, at a meeting with airline executives (including Munoz) last month, Trump stated–
I know you’re under pressure from a lot of foreign elements and foreign carriers. I’ve been hearing that a little bit. At the same time, we want to make life good for them also. They come with big investments. In many cases investments are made by their governments, but they are still big investments.
This appears to be a whole different line of analysis than Delta and United make in opposition to the ME3. If the White House is thinking about investment rather than unfair competition, the ME3 should be safe.
An Infrastructure Analogy
Munoz also spoke on the of the need for ATC at the meeting, comparing America’s current system to “having a gravel road when we need a highway.”
You would never drive your Ferrari on a gravel road.
He’s right on that. But is he and other airline leaders willing to cough up their share or at least accept passing it on to customers in the form of higher fares in order to make the upgrades necessary to finally transform the ATC system? I doubt that.
While Munoz’s position is perfectly understandable, I question its veracity and frankly see it as nothing more than an emotional ruse to protect United from competition.