This is going to play out for at least the rest of the year, and it will be fascinating the entire time.
Emirates President Tim Clark said he’ll travel to Washington this month to defend his airline against allegations from U.S. carriers that Gulf operators receive market-distorting subsidies from their governments.
Clark said he’ll meet with senior politicians to make his case, as he called the complaints by U.S. carriers “bluster and flimflam.” Emirates and the other airlines targeted by the U.S. allegations have not been given a fair chance to respond to a report that Clark said took two years to compile, the executive said.
“I’m surprised it got as far as it has without a response by the guys involved,” Clark told journalists in Berlin today. “I have a problem with form, not with substance. We will deal with substance.”
The three biggest U.S. airlines are turning to Congress for help in tightening aviation treaties with Qatar and the United Arab Emirates, two people familiar with the matter have said. U.S. carriers say the Gulf companies are able to undercut competitors on fares, a charge Clark today rebuffed, saying he’s targeting markets that have little overlap with those of U.S. carriers and give consumers better connectivity.
“We built a balance sheet from zero into one of the most formidable balance sheets in the industry,” Clark said. “To be told it’s a sham is a pity.”
U.S. carriers including American Airlines Group Inc., United Airlines Inc. and Delta Air Lines Inc. should review their long-haul philosophy instead of trying to roll back the advancements in connectivity that Emirates and its Gulf counterparts have established in recent years, Clark said.
The Emirates executive said he sees little risk of open- skies agreements in Europe and the U.S. actually being challenged, as there is too much at stake economically to roll them back.
Emirates, which operates the largest fleet of Airbus Group NV A380 superjumbos and Boeing Co. 777 wide-bodies out of its hub in Dubai, now runs 59 A380s out of an order for 140 in total. Clark said he’d entertain a top-up of between 100 and 200 of the world’s biggest passenger plane if Airbus considers putting fresh engines on the double-decker.
Should Airbus embark on a so-called re-engining of the A380, the Toulouse, France-based planemaker is most likely to pick Rolls-Royce Holdings Plc as its partner, using a derivate of the Trent XWB engine now deployed on the Airbus A350, Clark said. Emirates’ existing fleet of A380s uses the competing powerplant by General Electric Co. and United Technologies Corp., which Clark said are unlikely to re-engine.
Clark said he was more concerned six months ago than he is now that Airbus would drop the A380 outright because of a lack of orders. Airbus would be better advised to stick with the plane because the model is best equipped to serve congested travel routes, and because it is a symbol of European manufacturing. Airbus’s board may make a decision on an A380neo by the middle of this year, Clark said.
–With assistance from Hans Nichols in Washington.
This article was written by Andrea Rothman from Bloomberg and was legally licensed through the NewsCred publisher network.
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Photo Credit: Tim Clark, president of Emirates. PR photo.
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