US President Trump is reportedly discussing options regarding the Open Skies disupute with key administration officials as calls from lawmakers and airline associations for Gulf Airlines to be restricted from flying into the US grow.
National Economic Council Director Gary Cohn, White House trade adviser Peter Navarro, and White House chief of staff Reince Priebus, are among the names Politico reports are advising the US President on how the administration should navigate the dispute that threatens to derail the growth the Middle East's biggest carriers have been attempting in the US.
A delegation of lawmakers from Illinois have taken the 25th anniversary of the landmark open skies agreement to pen letters to the departments of Commerce, State, and Transportation. They allege that governments in the UAE and Qatar have provided over $50 billion in subsidies, violating the open skies agreement.
“The subsidies are distorting the market and denying U.S. airlines a fair and equal opportunity to compete. Every time a U.S. airline loses or forgoes a long-haul route as a result of subsidized Gulf carrier competition, American jobs are lost,” the letter, quoted by The Hill, and delivered last month read.
Repubican US Senator Ted Cruz has also weighed in on the debate, asking Secretary of State Rex Tillerson to "share my belief that American companies will not only compete, but excel in a true free market. Our government should once again stand by them and the agreements we have entered into," according to a copy of letter reportedly obtained by the Washinton Examiner.
Meanwhile Delta Airlines, along with United and American Airlines, has embarked on a PR and video campaign called "Our Future Our Fight" to "educate" airline and labour union employees to speak up against policy actions that it says will take the US aviation industry the way of the steel shipbuilding industries, which have now fallen on hard times.
The US has over 100 open skies agreements in effect, allowing unfettered access to airports on its soil in return for the same abroad. Gulf carriers have relied on the agreements to add long-haul routes and attract high value passengers onboard flights. Close to half of the 29 routes Emirates, Qatar Airways and Etihad Airways operate into the US were opened between 2012 to 2014.
However, that rate of growth has slowed in recent years. Unprecedented economic headwinds on domestic soil, as well as from a spate of travel related bans over the past year against flights originating from muslim-majority countries which they cater extensively to, have led to carriers pulling back on expansion plans to the country.
Gulf carriers have been attempting to push back against claims that they afforded any unfair advantage. A report by consulting group Campbell Hill and commissioned by Emirates, showed that the carrier provided 104,000 American jobs and contributed US$21.3 billion in revenue to the U.S. economy, including US$10.5 billion to the country’s gross domestic product, and US$6.4 billion of labor income in 2015.