Somewhere in the white pyramid that houses Airlines for America a new banner has been unveiled. “War is peace. Freedom is slavery. Ignorance is strength.”
If you’re a consumer who cares about a good airline product at a fair price, you should be disappointed this week. Emirates is cutting back 25 flights per week to the USA, a reduction of about 20%.
- Boston – 2 flights to 1 flight per day, effective 02 June 2017
- Fort Lauderdale – from daily service to 5x weekly, effective 23 May 2017
- Los Angeles – suspends second daily flight
- Orlando – from daily service to 5x weekly, effective 23 May 2017
- Seattle – 2 flights to 1 flight per day, effective 01 June 2017
Not surprisingly, U.S. airlines are rejoicing over news of the Emirates cutbacks, no doubt smugly proud that government policy has done with the market has been unable to do: harm their competition. But somewhat surprisingly, the interest group acting at the behest of American, Delta, and United felt the need to rub it in. It even issued a statement on the Emirates news–
The fact is, market demand has never played a role when the Gulf carriers decide where to fly. It is well known that the Gulf carriers, including Emirates, lose money on most of their flights to the United States and are propped up by billions of dollars in government cash…Their business model is based on growing their networks without regard to profitability in order to serve their governments’ goals to dominate global aviation. A perfect example is Emirates’ most recent route between Athens, Greece and Newark, N.J., a money-losing flight that is only possible because of government subsidies. That Emirates would refer to itself as “profit oriented” is simply laughable.
The statement defies logic
Wait. Just so I am clear, is this the argument — Emirates doesn’t care about profits, but it is cutting service by 20% because…
Emirates’ cutbacks directly undermine the shallow and dishonest argument from Airlines for America that Emirates operates without concern for profit. On the contrary, these service reductions demonstrate that Emirates is not willing to bleed for the sake of “global domination”.
“In the end the Party would announce that two and two made five, and you would have to believe it.”
Usually when I win at something, I am gracious about it. The U.S. legacies should be rejoicing that during a time of record profitability the competition that keeps them accountable has been shut out through a questionable government policy. But instead, the carriers are acting like children. One day they will face the harsh reality of true competition, so I hope they are enjoying their ice cream now.