The US carrier Delta Air Lines, which cut the frequency of its Atlanta-Dubai route this month, will cease the service early next year, citing “overcapacity and competition from subsidised Arabian Gulf carriers”.
Delta, the sole operator on the route, will stop these flights from February 11.
The US carriers – namely United, American Airlines and Delta – claim that Emirates, Qatar Airways and Etihad Airways have received US$42 billion in subsidies from their governments over the past decade. They say this allowed the Gulf airlines to start dumping capacity into the US, driving down prices and pushing out competitors.
The US carriers called on their government to review bilateral air agreements with the UAE and Qatar.
The Gulf carriers deny the subsidies allegations, and say poor customer service has caused US airlines to lose market share.
Delta said it would deploy its Boeing 777 aircraft used on the route to other transatlantic markets “where it can compete on a level playing field that’s not distorted by subsidised state-owned airlines”.
According to Delta, between 2008 and 2014, about 11,000 daily seats were added between the US and Dubai, Doha, and Abu Dhabi – more than 95 per cent of which are flown by Emirates, Qatar and Etihad.
But according to analysts, Delta has absolute exclusivity on the Atlanta-Dubai route and the reason for the pull-out is Delta’s limited network.
The American carrier does not take passengers beyond the Dubai hub. Emirates, on the other hand, takes passengers beyond Dubai, including to smaller cities in India, Pakistan and Bangladesh. Most passengers flying to the Gulf hubs of Dubai, Qatar and Doha connect beyond these points – rarely are the Gulf cities an end destination.
Addison Schonland, a founder and partner of US-based commercial aviation consultancy AirInsight, said: “This has nothing to do with subsidies.
“My sense is Delta wasn’t getting the revenue they expected. Besides one flight with no feed beyond, it didn’t offer anything much.”
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