JetBlue Airways, wading into rivals’ complaints about Persian Gulf carriers, said American, Delta and United airlines use international alliances with antitrust protection to stifle competition and control pricing.
U.S. regulators should review the agreements known as immunized joint ventures to ensure they are “truly benefiting the traveling public,” JetBlue said in a letter to the secretaries of the State, Commerce and Transportation departments.
JetBlue called for a review of immunized ventures while commenting on claims by the bigger carriers that three Persian Gulf airlines have gained an unfair competitive advantage through $42 billion in subsidies from their governments.
“Left unchecked, this U.S. government-sanctioned collusion will continue to stifle innovation and competition in international aviation and will directly harm JetBlue and consumers,” said the letter signed by Robert Land, senior vice president for government affairs.
Delta Air Lines, Fort Worth-based American Airlines Group and United Continental Holdings want the U.S. to open talks with Qatar and United Arab Emirates on whether billions in government cash have enabled Etihad Airways, Qatar Airways and Emirates to compete unfairly. The Persian Gulf airlines have denied receiving improper funding and said there is no basis for such talks.
Speaking at American’s annual shareholder meeting on Wednesday, Chief Executive Officer Doug Parker said the Persian Gulf carriers have added almost 25 percent more capacity to the U.S. since the allegations were made public. Parker said the U.S. airlines are worried that they will be unable to compete against airlines that don’t need to make a profit on their routes.
“If subsidized carriers start flying international routes, especially point to point, that don’t even go to the Middle East ... we may have to cancel some of our international flying and that means we will need less domestic flying,” Parker said.
The big three U.S. airlines say that the immunized agreements are good for passengers.
“Experts have long recognized that joint venture agreements between airlines allow passengers to fly more easily to more places around the world for lower fares,” said Jill Zuckman, spokeswoman for the Partnership for Open & Fair Skies formed by Delta, American and United.
JetBlue has accords with 40 international airlines, including code-share agreements with Emirates, Etihad and Qatar that allow them to book passengers on some of each others’ flights. The New York-based airline isn’t part of any immunized alliance.
Staff writer Andrea Ahles contributed to this report.