America’s largest airlines received US $71.48 billion in benefits

Research commissioned by Etihad Airways has quantified a range of government and court-sanctioned benefits and concessions received by the three biggest US carriers, Delta Air Lines, United Airlines and American Airlines Group. 

Delta is one of the carrier's mentioned in the report.
Delta is one of the carrier’s mentioned in the report.

These US airlines have received benefits valued at US $71.48 billion, more than $70 billion of which has been since 2000.

Not only has this enabled the nation’s three largest carriers to transition from the verge of bankruptcy to today’s industry leaders, each achieving multi-billion dollar profits, the findings counter claims that the Middle East carriers have an unfair advantage.

Releasing the findings by The Risk Advisory Group, the general counsel and company secretary of Etihad Airways, Jim Callaghan, said: “We do not question the legitimacy of benefits provided to US carriers by the US government and the bankruptcy courts.

“We simply wish to highlight the fact that US carriers have been benefitting and continue to benefit from a highly favourable legal regime, such as bankruptcy protection and pension guarantees, exemptions from certain taxes, and various other benefits. These benefits, which are generally only available to US carriers, have created a highly distorted market in which carriers such as Etihad Airways have to compete.”

Callaghan said the figures produced by The Risk Advisory Group were conservative, quantifiable and credible, and obtained from public records and statements.

He also referred to a 2011 interview, published by America’s National Public Radio, in which a former vice president of Continental Airlines, Pete Garcia, was quoted as saying: “Bankruptcy, for the airline industry in particular, is just a way to refinance the business. It is a financial move to keep you in business and give you time to renegotiate with your lenders.”

Last year, the three big US carriers generated collective net profits of $8.97 billion, equivalent to 45% of the total  $19.9 billion profits achieved in 2014 by the global airline industry. The trend has continued into 2015, with all three major US airlines announcing strong net profits for the first quarter.

Etihad Airways has consistently denied claims by Delta Air Lines, United Airlines and American Airlines that it received subsidies, and has stated publicly that it has received equity and shareholder loans from its sole shareholder, the Government of Abu Dhabi, the largest emirate and capital of the UAE.

Callaghan said the current claims by United Airlines, Delta Air Lines and American Airlines that they were being harmed by Etihad Airways were baseless, and an attempt to obstruct higher-quality competition.

“There is no evidence whatsoever of any harm caused by Etihad Airways to any of the three big US airlines,” he asserted.

“The US Open Skies policy has delivered more choice and better service for millions of consumers, more airline access to and from America, and record profits for the biggest airlines in the US.

“It is time to refocus on the real issue here – that the Open Skies policy is delivering the benefits it was designed to deliver, and that everyone is a winner.”

For more information about Etihad Airways ‘ campaign to keep the skies open, please visit: www.KeepTheSkiesOpen.com

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