Gulf carriers could face restrictions into Germany, says Lufthansa chief

Miami // Arabian Gulf carriers could face limitations on destinations and frequencies into Germany when the bilateral air agreement between the Gulf States and the European Union is addressed later this year, the chief executive of Lufthansa said on Sunday.

In March, transport ministers from Germany and France asked the European commission to address the subject of government subsidies to Gulf airlines, as Lufthansa and Air France-KLM claim that Emirates, Etihad, and Qatar Airways receive government support that disrupts “fair competition”.

“There are various ways to achieve the openness and balance when it is not fully fair,” said Carsten Spohr, Lufthansa’s CEO at the International Air Travel Association (Iata) annual general meeting in Miami. “It could be limitation of destinations to Germany. It could be limitations of frequencies … I will leave this to the government to evaluate about how much restrictions need to be put in place to create this balance between openness and fairness. Our position on this has not changed.”

Lufthansa’s call was echoed by America’s big three airlines, which also claim that Gulf carriers receive state subsides. They too have asked asked the Obama government to start consultations about the matter.

But not all European airlines agree with Lufthansa. International Airlines Group (IAG) – the mother company of British Airways and Spain’s Iberia – has refused to join the subsidy debate. It also augmented its ties with Qatar Airways when the Doha-based airline bought a near 10 per cent stake in IAG earlier this year.

Mr Spohr said that there are six hubs and their airlines in Europe that are mostly influenced by the rising influence of Gulf airlines.

“In Europe, I would say there are five or six hubs, which are affected, because they are depending on the transfer traffic to Asia,” he said.

“Amsterdam, Paris, Munich, Frankfurt, Zurich, and Vienna. The airlines of those hubs are the ones that are taking position [against Gulf carriers].”

He added that for Lufthansa the number and amount of flights between Europe and South-East Asia has been reduced “dramatically” due to Gulf airlines.

“Lufthansa is now down to three destinations in South-east Asia,” he said.

Mr Spohr added that the aviation industry should emulate lessons of “openness and fairness” from the World Trade Organisation (WTO) and implement it in the industry, although aviation is part of the WTO.

“Let’s look at the WTO to see what we can learn from there. This discussion I want to start, from the industry to the public.”

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