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Etihad CEO: Legacy airlines want to ‘pull up the ladder’

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Published: 26/03/2015 - Filed under: News »

Etihad Airways CEO James Hogan has warned against "the dark clouds of protectionism" ending the open skies agreements in place around the world.

The Australian chief executive was specifically referring to legacy carriers American Airlines, Delta, United, Air France/KLM and Lufthansa.

Earlier this month, the three US airlines jointly complained that Gulf carriers Etihad, Emirates and Qatar Airways have received $42 billion in subsidies from their governments since 2004, making a level playing field impossible.

But Hogan today said that the net result is "more consumers are getting the benefits of competitive choice".

Speaking at an industry event in London, he said: "Investing in success is not a crime; blocking competition would be. The dark clouds of protectionism are gathering over Europe and the United States.

"Five mega-carriers are trying to pull the ladder up after years of having it their own way. The people that will really lose if these giant legacy airlines are successful are the millions of travellers benefitting from new choice in the global air travel market."

However, Hogan praised British Airways and Willie Walsh, the CEO of its owner IAG.

He said: "There's one global airline that hasn't complained about the new competition from the Gulf carriers — and that's your home airline here, British Airways.

"BA is a business whose steel has been forged in decades of fierce competition — domestically, across Europe and globally. Willie Walsh doesn't complain when he sees new competition come into the market – he just gets on and competes."

Last week, Hogan hit out at criticism from US carriers that Gulf airlines receive unfair government subsidies, saying that "ultimately [it's] all about consumer choice" (see news, March 17).

Today, he did agree with the US carriers that the aggressive expansion by Gulf airlines is resulting in their "losing market share".

He said: "We've started some analysis on this issue and although the detailed study will take some time to complete, I can say that our initial studies already suggest that those claims are true. We admit it!

"But that so-called loss has resulted in thousands of new passengers for these suffering airlines, thanks to the market stimulus we provide.

"They are getting a smaller slice, it is true. But it is a slice of a bigger cake. And the bigger cake is proof that more people are able to travel – more consumers are getting the benefits of competitive choice."

Etihad served 14.8 million passengers last year over a network that is currently 111 destinations, Hogan said.

etihad.com

Graham Smith

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