Abu Dhabi, UAEThursday 29 October 2020

Etihad chief says consumers losing out with airline regulations

The current regulatory system is stifling consolidation, competition and consumer choice in the aviation sector, according to James Hogan.
James Hogan said customers were the victims of regulation. Kamran Jebreili / AP Photo
James Hogan said customers were the victims of regulation. Kamran Jebreili / AP Photo

The current regulatory system is stifling consolidation, competition and consumer choice in the aviation sector, according to the Etihad Airways chief executive.

The sector “cries out for new competition across many different markets, but it is one in which smaller operators can only operate in niche environments”, said James Hogan.

Speaking at the Royal Aeronautical Society in London on Wednesday, Mr Hogan warned that legacy carriers such as the “Big Three” US airlines – American, Delta and United – and Germany’s Lufthansa, were doing their best to stifle new competition.

“The victim here is the customer. The cost is innovation,” he said.

Etihad is under pressure from German regulators over its codesharing on 31 routes with airberlin, in which its owns a 29.2 per cent stake, and has until January to find an alternative arrangement. During the winter schedule, which began last month, more than 82,000 journeys have been booked by passengers on these connections, according to Etihad.

Mr Hogan said last month that “business people, tourists and families will be faced with less choice and higher costs”, as a result of the German authorities’ refusal to approve the codeshares.

Etihad and its Arabian Gulf neighbours, Emirates Airways and Qatar Airways, have been locked in a fierce row after the Big Three, at the start of the year, made allegations against them of unfair practices, in violation of open skies agreements.

In his London speech, Mr Hogan highlighted the success of the British approach to the evolving aviation industry and “the great aviation innovators” BA, easyJet and Ryanair.

“New approaches will help this industry flourish into the future. We should not allow those new approaches to be stamped out by the entrenched interests of the legacy carriers,” he said.

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Updated: November 5, 2015 04:00 AM