United Airlines is still in a fighting mood.
As will become clear in new data expected to be released tomorrow, Chicago-based United hasn’t back off of a heated battle with no fewer than three major international carriers based in the Middle East, including Emirates, Etihad Airways and Qatar Airways, all of which fly nonstop from Chicago’s O’Hare International Airport to various destinations in the Gulf region and via connections, to just about every major market in Europe, Africa and Asia.
United Airlines is one of three United States-based airlines battling lavishly-funded Gulf region airlines that are rapidly expanding.
United, along with American Airlines (NASDAQ: AAL), Delta Air Lines (NYSE: DAL) and a number of labor unions representing pilots, flight attendants and other workers in the airline industry, recently formed the Partnership for Open & Fair Skies, to collectively fight the Gulf region airlines as they rapidly become a major force on the international travel scene and siphon off business from U.S. airlines, thereby forcing the U.S.-based carriers to cut jobs.
The three major Gulf carriers are using lavishly-outfitted premium cabins on their fleets, luxurious airport lounges and rapidly-growing global route systems to entice more travelers on to their aircraft, while U.S.-based carriers such as United are, for the most part, just trying to play catch-up as they rebound from years of huge loses caused, in part at least, by a deep and prolonged recession and sky-high fuel prices.
The Partnership’s stated goal is to pressure the Barack Obama administration to open talks with government officials in Qatar and the United Arab Emirates about the competitive threat posed by the Gulf carriers operating from the region to Chicago and other markets in the United States. The U.S. airlines claim the Gulf region carriers are not honoring Open Skies agreements, while receiving billions in subsidies from their oil-rich governments — thereby making it impossible for carriers such as United Airlines to compete internationally on a level playing field.
So far the Obama administration has not signaled it is prepared to do the Partnership’s bidding. And it remains to be seen if the Partnership can make their case convincing enough to get Obama to bite.
Meanwhile, Emirates, Etihad and Qatar Airways, understandably, are loudly refuting the arguments made by United and the rest of the U.S. airlines and labor unions that are part of the Partnership for Open & Fair Skies. The Gulf carriers’ future success is at stake as well.
Only one thing appears certain at this point — the final shots in this war have not been fired.
United Airlines is a unit of United Continental Holdings (NYSE: UAL).
Originally Published on Chicago Business Journal.