Qatar accused of using proxy flights to access US

Qatar’s investment in Air Italy was described by the association as a way for the Doha-based airline to create a “loophole and dodge” the pledge.
Wednesday 19/12/2018
Akbar Al Baker, Qatar Airways CEO, talks to media during a roundtable conference in New Delhi, India, September 4, 2018. (REUTERS)
Akbar Al Baker, Qatar Airways CEO, talks to media during a roundtable conference in New Delhi, India, September 4, 2018. (REUTERS)

LONDON – Less than a year after putting a feud with the state-owned flag carrier of Qatar to rest, an alliance of US airlines accused Qatar Airways of using an Italian airline to plan additional flights between the United States and Europe in violation of a 2018 agreement.

The accusations came after an announcement by Air Italy of two new routes to San Francisco and Los Angeles beginning in April. Air Italy gave the US alliance more reason to be furious with the announcement of another plan to start fly to Toronto and Chicago next year.

Qatar Airways acquired 49% of Italian airline Meridiana in October 2017 and rebranded the carrier as Air Italy last February. Air Italy established service using new Boeing and Airbus jets acquired with assistance from Qatar Airways.

The airline’s Boeing 737 MAX jets were leased by Qatar Airways. The Airbus A330s used for Air Italy’s US routes previously were part of the Qatar Airways fleet.

Qatar Airways threatened to quit the Oneworld alliance next February, accusing partners American Airlines and Qantas of hostile business practices.

A Qatari exit from the Oneworld alliance, which it joined in 2013, would mean that Asian travellers using other members’ loyalty programmes, such as JAL’s Mileage Bank or Qantas Frequent Flyer, would no longer be able to credit miles flown with Qatar Airways to their accounts. Alliances such as Oneworld enable member carriers to sell seats on the same flights, known as code-sharing, or coordinate schedules to facilitate passenger transfers.

Qatar Airways CEO Akbar Al Baker accused American Airlines of “constantly trying to impede our investments and our strategic partnerships.

The US association representing, among others, three US legacy carriers — American Airlines, Delta Air Lines and United Airlines — released a statement on December 6, calling the Qatari manoeuvre “an insult to the United States president.”

Qatar’s investment in Air Italy was described by the association as a way for the Doha-based airline to create a “loophole and dodge” the pledge.

“With the announcement of new routes from Air Italy to the United States, fuelled by money from Qatar Airways, the government of Qatar has demonstrated a stunning lack of respect for President [Donald] Trump and Secretary of State [Mike] Pompeo,” said Scott Reed, campaign manager for the Partnership for Open & Fair Skies in a statement.

Reed suggested that Air Italy was basically Qatar Airways by a different name. “Once again, Qatar is using Air Italy as a Trojan horse built from subsidised cash to avoid its commitments to the Trump administration and launch new fifth freedom routes,” he said.

US lawmakers asked for the Trump administration to step in. US Senator Rand Paul, a Republican from Kentucky, drafted a letter to the secretaries of Transportation, Commerce and State urging an investigation into Qatar’s behaviour regarding Open Skies.

Also, 11 Republican senators, including Senator Ted Cruz of Texas, sent a letter to Transportation Secretary Elaine Chao expressing concern about Air Italy’s expansion.

“Air Italy’s entry into this crowded market appears consistent with Qatar Airways pattern of adding subsidised capacity in markets where demand is already well-served,” the letter said, concluding that the senators would “respectfully appreciate further examination and a response regarding how these recent developments comport with the Qatari government’s January 2018 commitments to the United States.”

Air Italy dismissed any suggestion that it was acting improperly, noting that Qatar Airways was a minority shareholder. Qatar Airways has not so far commented.

A between the US alliance and Qatar Airways emerged in 2015 and boiled over for about three years, with the American carriers, grouped in the “Partnership for Open & Fair Skies,” lobbying for a hard line against Gulf carriers, including Qatar Airways.

Delta Air Lines, United Airlines and American Airlines accused Qatar Airways of unfairly receiving government subsidies to compete in the US market. The dispute ended when the Qatari airline agreed to disclose financial information within a year and refrain from introducing “fifth-freedom” flights, routes to the United States from cities other than its base in Qatar, a victory for US airlines.

Despite what seemed like a major step forward in the dispute, the situation continued to heat up. Last October, Qatar Airways threatened to leave Oneworld alliance because of tensions with American Airlines.

“Qatar’s commitment to the Oneworld alliance has diminished as we are constantly being attacked by Oneworld partner,” Baker said at a conference at the time.