Qatar Airways has said that it would push forward with plans to buy a stake in American Airlines even though the US-based carrier just recently ended their codeshare agreement.
American just announced that it was ending codeshare pacts with Qatar Airways and Etihad Airways as “an extension of our stance against the illegal subsidies that these carriers receive from their governments”. Both Gulf based carriers have denied the allegations.
American’s decision to end the agreements which allow airlines to book passengers on each other’s flights, intensifies a dispute between U.S. carriers and Gulf competitors over competitive advantages.
Qatar Airways Chief Executive Akbar Al-Baker said on Thursday he was upset by the decision, but it would not have an impact on the Middle East carrier’s plans to buy up to a 10% stake in American, announced last month.
“Our stock purchase request and filing is going ahead as normal. We had to clarify certain questions of the regulator, which we compiled with”, Al-Baker said.
Qatar Airways sent a revised antitrust filing to U.S. regulators on Wednesday seeking clearance to buy up to a 10 percent stake in the U.S. carrier, according to the filing.
A stake in American would be a boon to Qatar Airways’ investment portfolio, which already boasts of a 20% stake in British Airways-owner International Airlines Group (ICAG.L) and 10% of South America’s LATAM LAN.SN.
American Airlines CEO Doug Parker, however, declared in a letter to his employees last month that “We aren’t particularly excited about Qatar’s outreach” and that it was head-scratching given the U.S. carrier’s very public stance on state support given to Gulf carriers.
American and several other U.S. carriers have alleged that state subsidies allow Qatar Airways, Etihad and Emirates to offer lower fares and more services to long-haul, international travelers.
They are urging the Trump government to limit the Middle Eastern carriers’ access to U.S. airports, and the White House is considering their request, according to government officials and airline executives who have knowledge regarding the situation.
Al-Baker clapped back at American’s decision to end the code-share agreement was “not in the spirit of the Oneworld alliance” and that Qatar Airways had other partners in the United States “who want to work with us”.
Qatar Airways, American Airlines, IAG’s British Airways, Iberia and LATAM are all members of the one world airline alliance.
Al-Baker previously said Qatar Airways would purchase American shares on the open market before formally seeking board approval from the U.S. carrier to increase its ownership. The U.S. airline’s own rules entail advance approval from its board for the purchase of a stake of 4.75 percent or more.
American said on Wednesday that cancelling code-sharing agreements with Qatar Airways and Etihad would not have a major financial impact for the U.S. carrier.
Etihad, which flies to six U.S. cities, zinged American of being “anti-competitive” and “anti-consumer” and said it was disappointed with the decision.
An interline relationship between Etihad and American, which allows customers from two airlines to buy connecting flights on one ticket, would remain in place to connect passengers to secondary markets, an Etihad spokeswoman said.