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| United Airlines CEO Oscar Munoz speaking at the U.S. Chamber of Commerce Aviation Summit, March 2, 2017 with Carol Hallett, counselor to the U.S. Chamber and former president and CEO of the Air Transport Association of America - now known as Airlines for America. |
More hot air from Oscar.
Last week, United Airlines CEO, Oscar Munoz, said about the Middle-East airlines:
"Those airlines aren't airlines. They're international branding vehicles for their countries."
Munoz made clear that United will aggressively push the US government to take action against the United Arab Emirates and Qatar over what he considers unacceptable government assistance to Emirates Airline, Etihad Airways and Qatar Airways.
'Those Airlines Aren't Airlines'
This sob-a-rama from the US "Big 3" about the Middle East airlines conveniently distracts from the escalating abuse going on in the main cabins of the US carriers.
Under Munoz's leadership, making the United "better" meant "Basic" economy (no overhead bins for you), tight 30" pitch seating in most narrow-body aircraft, and adopting high-density, ten abreast seating on the airline's 777's with 31" pitch.
Also, making record profits while simultaneously complaining about "unfair competition" has failed to register much sympathy with flyers.
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(Source: Money/CNN)
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In recent years, the US airlines have also fought every consumer protection proposal of the Department of Transportation -in Federal Court and in Congress.
If the Middle-East airlines aren't airlines, then the US carriers aren't either - as they're essentially run by Wall Street investors who artificially inflate prices by restricting capacity.
So many flights now are oversold, meaning they could add seats in almost any given market. But the US carriers won't do this because they only do what is needed to keep investors happy - not what is good for the flying public. It's like re-regulation, except done by the airlines and not by the US government.
Since the US legacy airlines set up their global alliances, which are like antitrust immunities, and consolidated the industry, their public-policy focus has been to thwart competition.
For example, they are fighting a proposal to lift the cap on the passenger facility charge (PFC) so that airports are not able to make improvements that would attract new airline competitors. Likewise, they are monopolizing scarce slots at Washington National and LaGuardia to keep out low-cost airlines and fighting to block foreign carriers from entering the US market. They also want to crush airfare search and compare websites sites that keep airlines honest.
Partnership for "Open and Fair Skies"
Back in 2015, United, American Airlines and Delta Air Lines produced a report accusing Qatar Airways, Emirates and Etihad of getting more than $40 billion of subsidies from their government owners.
But the US Department of Transportation took a look at the US carriers' "factual evidence" and threw it in the trash.
All national carriers get government support in some form or another. The reason the US airlines still exist is due to billions in government bailout money in the early 2000s and chapter 11 protection since then.
But the fight against the Middle East airlines seems to have been renewed. Maybe the US carriers feel emboldened by a new administration. Why are the CEOs all repeating the same line? We can almost predict that next there'll be allegations of terrorism links against the Middle East airlines.
Finally, who is behind the Partnership for Open & Fair Skies? It's a lobbying group composed of American Airlines, Delta Air Lines and United Airlines, along with the Air Line Pilots Association, Int'l, the Allied Pilots Association, the Airline Division of the International Brotherhood of Teamsters, the Association of Flight Attendants-CWA, the Association of Professional Flight Attendants, the Communications Workers of America and the Southwest Airlines Pilots' Association.
Not Clear Cut What Trump Will Do
Trump could easily side with the Middle East airlines, because the US carriers are not the good guys -and taking into account his populist rhetoric. The US airlines are the ones with the inferior product and like to nickel and dime people to death. Which makes the Middle East carriers seem, in contrast, like models of pleasant, well-run companies.
Trump is also in a difficult position with his campaign promises vs. his business interests in the Middle East. How can he protect jobs with the US major airlines and not offend the Middle East countries?
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