We Want to Fly to India, Mideast – Enforce Trade Deals and We Will, Delta CEO Says

Delta Air Lines (DAL) would resume flights to India and the Middle East if the U.S. were to successfully restrain the growth of the Middle East carriers, says CEO Ed Bastian.

“When we win this fight, we’re going to go back to India,” Bastian said during a 15-minute movie intended to explain Delta’s involvement in the conflict to employees and posted recently on its website.

“We’re going to go back to be able to fly back to the Middle East,” Bastian said. “We’re going to be able to add jobs, lots of jobs. We are going to be able to add new longhaul airplanes to support that growth. And that’s just the start.”

In February 2016, Delta ended its Atlanta-Dubai flight, saying it could not compete with subsidized service to multiple U.S. hubs by Mideast carriers. In May, Qatar Airways began Doha-Atlanta service.

As for India, Delta ended Amsterdam-Mumbai service in March 2015. Today, United is the only U.S. carrier serving India, with flights from Newark to Mumbai and New Delhi.

A study commissioned by Delta, American and United found that the governments of Qatar and the United Arab Emirates have provided more than $50 billion in subsidies to Emirates, Etihad Airways and Qatar Airways, violating the Open Skies agreements that enable flights between the two countries and the U.S.

In the movie, for the first time, a leader of the coalition opposing the Mideast three’s rapid expansion lays out the case that intrusions by the Mideast carriers have dramatically weakened Europe’s carriers.

“Fifteen years ago, the Europeans were some of the strongest airlines on the globe,” Bastian said. “AirFrance, KLM, Lufthansa – they’ve all been harmed massively.” Today the Gulf carriers fly more than 100 daily flights from their hubs into Europe.

Meanwhile, Australia’s Qantas has been turned into a “feeder” for Emirates, said an unidentified voice on the movie.

By contrast, some major countries including Canada have resisted the Middle East carriers’ intrusions

The Mideast carriers, based in countries that combined are the size of South Carolina, have more than 500 widebody orders, more than twice the combined orders from Chinese and U.S. airlines.

“Where are those wide bodies going to go?” Bastian asked. “There’s only three markets that can sustain them.

“I guarantee you that the Chinese are not going to let them in,” he said. “The Japanese will definitely not let them in. In our market, if we don’t wake up, we are going to wind up being overrun by them.”

Among the experts appearing in the movie are Charlene Barshefsky, former U.S. trade representative, who said, “the scope of the {trade} violation here simply takes one’s breath away:”

Jim Burnley, former U.S. transportation secretary, who said the U.S. has aviation “trade agreements with over 120 countries and we’ve got real problems with {just} two of them,” and Doug Parker, CEO of American Airlines Group (AAL) , said “This is about American jobs and our ability to keep American jobs if we don’t do something about this as a country.”

 Delta spokeswoman Elizabeth Wolf said the movie “is part of Delta’s ongoing efforts to urge government officials in Washington to level the playing field for U.S. airlines and enforce Open Skies agreements with the United Arab Emirates and Qatar.
 “Earlier this year, Delta launched an internal campaign to further raise awareness of this issue among Delta employees and encourage them to ask the U.S. government to take action,” Wolf said. “This movie is part of that campaign.”
 The movie was first shown to employees in Atlanta, then shared internally and then made available on Delta’s website last week, she said.
Delta’s shares were down 0.9% to $54.96 early Monday afternoon.

Original article found at: TheStreet.Com