MIAMI — The battle between the US3 (Delta Air Lines [DL], American Airlines [AA], and United Airlines [UA]) and the ME3 (Emirates [EK], Qatar Airways [QR], and Etihad Airways [EY]) is still ongoing. What would happen if they, all of the sudden would begin to cooperate?
Emirates, in particular, believes that if such thing would happen, it could turn out as a positive thing for everyone involved.
“US3, Grow up!” — Tim Clark
Sir Tim Clark, Emirates’ CEO said in an interview with Business Insider that the US3 need “need to grow up” and that “we need to have a mature way of going about our business.”
Clark also said that the US3 had not provided sufficient evidence to suggest that they have been directly affected by the ME3’s presence in the US and around the world.
The US3, however, claim that the $52 billion in state subsidies that the ME3 had received over the past decade is a violation of the Open Skies Agreements between the ME3 countries and that it is affecting them through unfair competition.
READ MORE: Analysis: The Rise, Fall, and Eventual Resurgence of the Middle East’s Airline Giants – Part I
Clark also mentioned that the tactics played out by the US3 are comparable to that of “a three-year-old at the playground,” and that they “haven’t got a leg to stand on, so they go after this theater.”
However, after those comments, Clark added that rather than having these two groups opposing each other, there could be a form of consensus and partnership between the six carriers.
Emirates, for instance, has noticed that connecting traffic from their airline could help AA’s hubs in Dallas and Chicago or UA’s hub in Houston.
READ MORE: Analysis: The Rise, Fall, and Eventual Resurgence of the Middle East’s Airline Giants – Part II
In fact, JetBlue has allowed Emirates the opening of numerous US destinations, like Fort Lauderdale (FLL), for instance. The Emirati carrier feeds JetBlue flights out of FLL and many other hubs in the US.
Clark holds that if the US3 do not get onboard in a partnership, they are just losing out on opportunities to make more money in an already saturated US market.
Are the US3 Missing Out?
It could be argued that the US3 are missing out if ME3 carriers continue securing partnerships and codeshare agreements with smaller, yet incisive airlines in the US.
However, the recent agreements made by the American and Qatari States on no fifth freedom flights to the US via a connecting point would suggest that the US3 are not missing out. Instead, the US Government seems to be on a path of employment, customers and more importantly sales retention.
Critics argue that the ME3 carriers are pushing for partnerships with major US carriers so that they can get access to different US destinations that are not on their current networks.
Through codesharing and other agreements, the ME3 can boost their revenues at the expense of American carriers.
From the traveler standpoint, however, a partnership between the ME3 and the US3 carriers would undoubtedly prove to be very beneficial as connectivity and frequencies would increase. However, a consolidation of such size would decrease competition and inherently raise prices, hindering the customer’s capability to choose based on price and preference.
In conclusion, this could go one or two ways. It can benefit everyone involved—as Tim Clark noted above—or it could turn out to reduce competition and increase prices for the customer, ultimately helping the ME3 and hurting the US3.
In the end, it’s a matter of geopolitics, airline strategy, and sovereignty. Which airline will come out on top?