- President Donald Trump did not side with US airlines in their dispute with Qatar Airways over a trade treaty, according to a new report.
- The CEOs of United, American, and other US airlines met with the president at the White House yesterday.
- The CEOs were reportedly “shocked” to walk away from the meeting empty-handed.
- Visit Business Insider’s homepage for more stories.
When the CEOs of most major US airlines met with President Donald Trump and Vice President Mike Pence Thursday afternoon, they hoped – and expected – to make progress in their quest to penalise Middle Eastern airlines – particularly Qatar – for their alleged unfair competitive practices.
But things did not go as planned.
The executives left the White House without securing any commitment to intervene in the dispute, despite the administration’s inclination toward protectionist trade policies, according to a report from CNBC.
The failure by the CEOs of United and American Airlines – Delta CEO Ed Bastian was unable to attend because of international travel, according to a spokesperson, but the airline lobbies with the other two against the Middle Eastern competitors – highlights that, at least in this case, the White House is not necessarily willing to stake negotiating capital to support major US companies if there’s a chance of it doing more harm than good.
At the root of the issue is a small recently rebranded and expanded Italian airline, Air Italy. Qatar Airways has a minority stake in the airline, which flies to several locations in the US. The US airlines, in a lobbying coalition, argue that Air Italy’s flights represent illegal “fifth freedom” flights – flights in which an airline flies between two countries that are not its own. Those flights are highly regulated and typically must originate or end in the airline’s home country after making a stop in the third.
Executives from other airlines and industries have argued that, since Qatar is not the majority owner of Air Italy, there is no violation of the Open Skies trade treaty that regulates international air travel.
The dispute over Air Italy is the latest phase of a larger accusation by the US airlines that their Middle Eastern competitors illegally receive subsidies from their governments, allowing them to compete unfairly.
According to CNBC, the airline CEOs and their lobbying coalition – Partnership for Fair and Open Skies – were “shocked” that the president did not side with them and that Qatar CEO Akbar Al Baker was invited. An official quoted by CNBC said “the president expressly wanted the Qatar CEO as he wanted a variety of perspectives, as he always does.”
The White House was also miffed that Bastian – Delta’s CEO – “refused” the invitation, although Delta refuted that characterization.
Qatar Airways is a major consumer of US products, just last week finalising an order of five Boeing freighters powered by General Electric engines. Trump was present at the order signing.
The White House told the US airlines to file a complaint through federal regulators, according to sources cited by CNBC, refusing to offer speedy favourable action.
The airlines, the Partnership for Open and Fair Skies, and the White House all did not immediately return Business Insider’s request for comment.