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The European Commission (EC) has given the US a stern warning not to take any action against Milan-based Air Italy that would prevent it flying to the US. ATW has obtained a copy of the letter, which was sent from EC Mobility and Transport director general Henrik Hololei to US State Department under secretary, economic growth, energy and environment Manisha Singh. In it, Hololei uses unusually direct language to make clear that the EC “will take all steps necessary to defend the rights of the European Union (EU), its Member States and its air carriers” under the EU-US Open Skies agreement, which permits EU country-based airlines like Air Italy to fly to any US destination and vice versa. The EC warning comes as American Airlines, Delta Air Lines and United Airlines have joined forces in a campaign directed at challenging Air Italy’s flights to the US because Qatar Airways has a 49% stake in the Italian carrier. The three US majors have taken out full-page advertisements in US newspapers and lobbied Congress, claiming that Air Italy’s services are really Qatar Airways fifth freedom flights. While the US also has an Open Skies agreement with Qatar that permits fifth freedom flights, the two countries agreed to a voluntary side letter in January, 2018 in which Qatar said Qatar Airways had no plans to launch fifth freedom services to the US. EC rules permit the 49% stake that Qatar Airways has in Air Italy; Qatar Airway also has a 20% stake in International Airlines Group (IAG), which owns British Airways (BA), but the US airline campaign is not challenging BA’s right to serve the US or calling BA’s flights Qatar Airways fifth freedoms. BA is an American Airlines’ joint venture partner. Hololei, whose letter was cc’d to US Department of Transportation assistant secretary, aviation and international, Joel Szabat, tell Singh: “I have come to understand that, following persistent, but unfounded demands from certain parts of the US airline industry, the US administration is potentially considering taking measures against the services of Air Italy to the United States. In this context, I would like to bring to your attention our serious concerns. “Air Italy is an established EU carrier and its services to the US are covered by and fully consistent with the EU-US Air Transport Agreement (ATA) using 3rd and 4th freedom traffic rights between the EU and the US. Therefore, any measure to curtail or end the rights of Air Italy to serve the US would constitute a clear and serious violation of the ATA. “Such action would be unprecedented and would put into question the most fundamental principles under which our aviation relations have so successfully developed over more than 10 years. I am sure that you would agree with me that the ATA has served us all well and we are always ready to work together with you and your team on this, including on clarifying incorrect public allegations and representations made by certain market participants. “The European Commission will take all steps necessary to defend the rights of the EU, its Member States and its air carriers under the ATA.” A petition was circulated on Capitol Hill calling on the Trump administration to take action against Qatar Airways over Air Italy and US Representative Debbie Lesko (Democrat-Arizona) sent a letter to the heads of the State, Commerce and Transportation, saying that Qatar Airways’ financial support for Air Italy’s expansion into the US violated the US-Qatar Open Skies side letter. However, there has been a backlash against the US majors’ campaign, with other US airlines, airports and travel consumer organizations warning of “misleading and inaccurate” claims. “The [Lesko letter] is premised on misleading claims promoted by parties that stand to benefit financially and its fundamental basis is incompatible with the facts regarding Open Skies and contrary to the broader economic interests of the US aviation, manufacturing and tourism industries, and the millions of American customers we serve,” an aviation coalition wrote in early June. This week, a new US-United Arab Emirates (UAE) joint government statement was released in which the two countries said they “shared an ongoing commitment of the United States and the United Arab Emirates to fully maintain all aspects of their Open Skies relationship.” The significance of the statement lies in its confirmation that all rights of the original 2002 US-UAE Open Skies agreement are confirmed. American, Delta United Airlines and their affiliated labor groups had sought to freeze UAE fifth freedom rights in the agreement, which would have prevented Dubai-based Emirates from expanding its transatlantic flights. Emirates operates Dubai-Milan-New York and Dubai-Athens-New York flights. The other UAE major airline, Etihad Airways, does not operate any fifth freedoms, nor does Qatar Airways from Doha to the US, but the rights are open to all US, UAE and Qatar carriers and are a standard of Open Skies pacts. Karen Walker/ATW firstname.lastname@example.org https://atwonline.com/open-skies/ec-transport-chief-warns-us-not-curtail-air-italy-flights
May 22, 2019 There has been a lot of talk recently about airlines investing in airports. Is it a new trend? Is it even manageable? Well, the CAPA – Centre for Aviation Global Airport Investors Database highlights that it is a not a new phenomena and lists some 40 airlines worldwide that are investors in airports, or have been, or (have) aspire(d) to be; including the likes of Lufthansa. Lufthansa is probably the most notable of all, as well as being the largest, having a 5% stake in Fraport, one of the world’s leading airport operators and investors, which at least permits it some influence over Fraport’s decisions made in respect of Frankfurt International airport, its home base. Other than Lufthansa there are two other large airlines currently making the news for their efforts to take control of airports, in their own country or abroad. The first is Kenya Airways, which last year launched an audacious attempt to operate Nairobi Jomo Kenyatta International airport, by establishing a holding company, under the terms of a 30-year concession contract with Kenya Airports Authority. Following stiff opposition it became a proposal for a public-private-partnership instead but the Parliamentary Transport Committee rejected the takeover all the same. The airport argues the airline has neither the money nor the resources to run it while the airline warned of defective infrastructure at the airport which would risk Kenya losing its position as Africa’s aviation hub if unattended to. The other is Qatar Airways. The Gulf giant has been talking since 2018 to Russian authorities with regard to signing a concession agreement for Moscow Vnukovo Airport. It could be completed in 1H2019. At the other end of the scale are airlines such as Bangkok Airways of Thailand, a regional carrier that built and manages its own airports at Koh Samui, Sukhothai, and Trat. It isn’t finished yet. Its president Puttipong Prasarttong-Osoth has said the carrier aims to construct one new airport in Thailand and one in a neighbouring country, entering a JV with local investors for the project outside Thailand. The airports are necessary given the congestion of air traffic and the potential for routes that, “other competitors are yet to realise.” The European equivalent is Eastern Airways, a regional carrier which invested heavily in Humberside Airport in the UK several years ago when Manchester Airports Group quit that facility. There is no single region of the world where such practices are more popular than others but it does seem to have caught on in Southeast Asia, where VietJet Air, Vietnam Airlines, Jetstar Pacific (all Vietnam) Lao Central Airlines, AirAsia, Garuda Indonesia, Pacific Pearl Airways (as a start-up airline), and Thai Airways have at one time or another applied for the rights to operate one or more airports, in their own country or abroad, and either alone or in consortium with airport operators and investors. They are actually everywhere. Argentinean budget start-up FlyBondi for example presented a 15-year concession proposal for El Palomar Airport, a military facility in the Buenos Aires suburbs, outlining a USD30 million investment for the construction of a new terminal at the airport. It opted to use the airport as its main base anyway, irrespective of the fact that only three flights a day were permitted. El Palomar is currently operated by Aeropuertos Argentina 2000. At the other end of the scale in Brazil, Azul Airlines went after a 1% share in Campinas Viracopos airport, the maximum holding it was allowed as an airline under Brazilian law. Meanwhile, in Africa, Comair tried to save the old Durban Airport by taking it over, but failed to do so. There is no common theme as to why so many airlines have sought to enter the airport business, and still do so today. In most cases it is because they want to protect themselves where decision-making is concerned. Airlines and airports operate in different time zones, the former generally having a shorter-term outlook than the latter. Alternatively (and sometimes additionally) it is because they do not have faith in either the government or the airport operators in their own countries in particular to invest in new or upgraded airports, to match their expansion. That is particularly true in Southeast Asia where governments have also found it difficult to attract foreign investors. https://blueswandaily.com/airlines-investing-in-airports-theres-actually-more-than-youd-think/