US opponents of three Gulf carriers and Norwegian are hoping to find a sympathetic audience in President-elect Donald Trump, casting uncertainty over how a new administration will treat several hot button issues that have divided the airline industry.
While Trump has not publicly taken sides in the disputes involving three Gulf carriers - Emirates Airline, Qatar Airways and Etihad Airways - and Norwegian, groups that are against the US expansion of these foreign airlines are seeking the president-elect’s listening ear.
A coalition of US airlines and labour groups that accuses the three Gulf carriers of receiving unfair state subsidies says it looks forward to briefing Trump and his new government on the issue.
Backed by Delta Air Lines, American Airlines and United Airlines, the coalition says the alleged subsidies to the Gulf airlines place 300,000 US aviation jobs in peril. “We are optimistic that the Trump administration will stand up to the UAE and Qatar, enforce our trade agreements and fight for American jobs,” says a spokesman for the Partnership for Fair and Open Skies.
Qatar Airways chief executive Akbar Al Baker appears unconcerned over any implications that a Trump presidency could bring to the subsidies dispute. Along with Emirates and Etihad, the Doha-based carrier has denied the allegations that it benefits from state subsidies.
Al Baker, who says his relationship with Trump “goes way back”, appears to shrug off any concerns that Trump could back his US opponents in the dispute. This is despite Trump’s hardline stance against the Middle East in his proposals for changes to immigration and foreign policy.
“I have always said that the rhetoric that surrounded Mr Trump’s campaign with respect to our region is only political in nature, and I am certain that the road ahead will clearly demonstrate that Qatar and the United States have enjoyed a long standing partnership and are close allies,” says Al Baker.
“We are confident that this relationship will only continue to grow, and will forge stronger ties across the Middle East region as a whole.”
Emirates and Etihad did not immediately comment on how Trump’s win could impact them.
The Gulf subsidies dispute has sharply divided the airline industry in the past two years. Following intense lobbying, the current Obama administration held informal talks with officials in the UAE and Qatar, but has yet to take any action.
IAG chief executive Willie Walsh, who had previously raised alarm over what he believed to be increasing protectionism in the US aviation industry, says it is in the new US government’s interest to ensure a US-UK bilateral air services agreement that is pro-competition after the Brexit vote.
“If [Trump] is to deliver on the promises he gave – growing employment and strengthen the economy – aviation is going to be a key facilitator to achieving those goals,” says Walsh while speaking at the International Aviation Club in Washington DC.
“It is in both countries’ interests that a UK-US agreement ensures that consumers and businesses continue to benefit from the improved competition, choice and value that has been delivered by the EU-US open-skies agreement.”
The EU-US open-skies deal is already a point of contention in US criticism of Norwegian, whose plans to operate to the US from two European subsidiaries have been opposed. Norwegian’s critics today drew attention to Trump’s trade policy that prioritises the US economy, as it renewed its call for Norwegian’s foreign air carrier permits to be denied.
The Air Line Pilots Association (ALPA), which accuses Norwegian of seeking to undermine labour laws, says: “ALPA remains committed to working with current and newly elected officials on collaborative efforts to call for the enforcement of US air transport agreements and fair competition for US airlines and their workers by opposing Norwegian Air International’s foreign air carrier permit application.”
A Norwegian spokesperson says it is too early to comment on the impact of Trump’s presidency, but reiterates that Norwegian’s US expansion plans comply with the US-EU open-skies treaty. He also points out Norwegian’s hiring of US pilots, which he says is in line with Trump’s mission to create more jobs.
BOOST FOR AIRPORTS AND ATC
US airlines are hoping that a Trump presidency could usher in airport infrastructure spending and rejuvenate a controversial plan to privatise US air traffic control.
Trade association Airlines for America (A4A), which represents nine US carriers, pushed for Trump’s support for a privatised ATC system. “We’re eager to work with President-elect Trump to transform it to reduce delays for the 2.2 million passengers and 50,000 tons of cargo that fly every day,” says A4A president and chief executive Nicholas Calio.
The plan to privatise ATC, proposed by Republican congressman Bill Shuster, had failed to receive widespread support in the US Congress. But Trump’s win and the retention of power by the Republicans in both chambers of the Congress could deliver fresh impetus to the proposed privatisation, which is supported by most US carriers.
A4A and US airports welcome Trump’s earlier comments that he would seek to create $1 trillion in infrastructure investment within the first 100 days of his presidency. “We look forward to Congress returning to the mindset that prevailed for generations that infrastructure investments should be differentiated from other spending and that 'concrete knows no political affiliations’,” says Todd Hauptil, the president and chief executive of the American Association of Airport Executives.
REPERCUSSIONS IN LATIN AMERICA
A Trump presidency will likely prompt concerns over newly reinstated air service to Cuba and could potentially impact growth of US-Mexico transborder traffic.
Trump has vowed to reverse President Obama’s move to restore relations with Cuba, which saw a return of US airline scheduled flights in August after a hiatus of more than 50 years.
It is not immediately clear if the new bilateral air services agreement will be affected, but SIlver Airways chief executive Sami Teittinen believes that Trump is not likely to take “any drastic actions”.
Silver serves several destinations in Cuba from Fort Lauderdale.
Cuba has not officially commented on Trump’s win, but today announced a week of military drills to prepare for “enemy actions”, say reports.
Closer to the US, a Trump presidency could spell out longer-term consequences for US-Mexico transborder traffic, which was recently boosted with a new liberalised air services treaty.
The Mexican peso fell by as much as 13% after Trump’s victory, following a campaign in which he called for a wall to be built on the southern US border with Mexico - to be paid for by Mexico. Mexico’s government reiterates today that it will not pay for a wall.
Additional reporting by Edward Russell and Jon Hemmerdinger
Source: Cirium Dashboard
