Delta protests Ex-Im funding for LOT 787s

London
Source:
This story is sourced from Pro
See more Pro news »

Delta Air Lines is formally protesting Polish carrier LOT's application for US Ex-Im Bank funding support for its Boeing 787 fleet.

It complains, in a detailed submission to US regulators, that the LOT application will result in "substantial competitive harm" to US carriers, which is "contrary" to the bank's statutory mandate.

"There is strong evidence that LOT will use the bank's financing to compete against US carriers," it states, because the Polish operator will deploy the 787s on routes to Chicago and New York.

LOT's plans to use the type for flights to Toronto, it adds, will also generate competition for connecting US traffic.

Delta claims LOT is a "medium-risk airline" that could obtain financing from private capital markets, adding that there is "little risk" that LOT would drop its 787 acquisition in favour of Airbus based on a promise of foreign export credit agency funding.

"Providing financing under these circumstances supplies an unnecessary subsidy to a foreign airline that competes with US airlines," says Delta. "The bank should therefore deny the LOT application."

LOT has eight 787s on order with the first due for delivery in mid-November. It will begin US services with the type in January 2013.