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AABB777
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IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 3:54 pm

IAG responded yesterday - May 14 - to the US3's Gulf carrier subsidy claims. The response is pro-Open Skies and pro-competition. In the response IAG states: "The White Paper’s allegations on subsidies to Gulf carriers do not withstand scrutiny. IAG also has serious doubts about the way information is presented in the White Paper."

Some key takeaways from the doc:

- Not only do Gulf carriers bring competitive service and prices, they also stimulate the market, so that much of the increase in their own passenger traffic is incremental, not taken from existing operators.

- “IAG disputes the evidence and conclusions that unfair subsidies are being provided by the Gulf States to the Gulf airlines contained in the White Paper prepared by American, Delta and United. IAG believes the evidence and therefore the conclusions to be unreliable and wholly inappropriate as a means of informing important government policy decisions. The White Paper’s arguments should be rejected as a return to international aviation policies that protect airlines from competitors instead of fostering competition.”

- British Airways has faced direct competition from Emirates for over 25 years.

- The White Paper makes much of the Gulf carrier impacts in relation to passengers travelling indirectly e.g. between India and the US, as if consumers should be denied this choice. Passengers travelling between two points on the globe do not “belong” to any particular airline or group of airlines. Airlines must compete to offer passengers what they want. The outdated concept of “ownership” of passenger traffic must be rejected by all governments.

- Fuel subsidies to any of the Gulf carriers are non-existent. It is not credible to make allegations simply because the States concerned have large oil and gas reserves, especially when there is clear evidence that the carriers concerned have standard commercial contracts in place with well-established jet fuel suppliers.



The full response can be found here: http://www.eturbonews.com/58984/wron...d-right-etihad-emirates-and-qatar-
 
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Polot
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 4:18 pm

Why does IAG care about the whole US3 vs. ME3 dispute? Oh wait...
 
jetblue1965
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 4:18 pm

I'm running out of popcorn just from watching all of this. And even funnier the response is coming from IAG, which JVs with US3 but also partially owned by one of ME3.
 
AAIL86
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 5:02 pm

Quoting polot (Reply 1):
Why does IAG care about the whole US3 vs. ME3 dispute? Oh wait...

Yes, its quite curious that IAG (Read: BA) is picking a side. I wonder why they feel the need....  
The way to see by faith is to shut the eye of reason - Benjamim Franklin
 
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PM
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 5:11 pm

QR owns 10% of IAG.

Therefore, 90% of IAG is not owned by QR.

BA was privatised nearly thirty years ago and has been a consistent proponent of open skies and free competition.

To imply that their stance in the current (silly) dispute is entirely due to the (pernicious?) influence of Mr. Al Baker is childish and naive.
 
LJ
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 5:18 pm

Quoting PM (Reply 4):
Therefore, 90% of IAG is not owned by QR.

QR is still the largest shareholder.

Quoting PM (Reply 4):
To imply that their stance in the current (silly) dispute is entirely due to the (pernicious?) influence of Mr. Al Baker is childish and naive.

Why would IAG interfere in a dispute where they're not a party of? Nobody asked them to come with a press release which is very pro-ME3.
 
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PM
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 5:23 pm

Quoting LJ (Reply 5):
Why would IAG interfere in a dispute where they're not a party of?

The airline industry is - self-evidently - global. Protectionism here, subsidies there directly affect all airlines and none more than those with a global reach. Of course IAG have an interest in this dispute.
 
AAIL86
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 5:25 pm

Quoting PM (Reply 4):
To imply that their stance in the current (silly) dispute is entirely due to the (pernicious?) influence of Mr. Al Baker is childish and naive.

I certainly didn't imply anything about Al Baker at all, just that its curious that IAG feel the need to say anything at all.

Shakespeare's line "The lady doth protest too much, methinks" comes to mind.
The way to see by faith is to shut the eye of reason - Benjamim Franklin
 
LJ
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 5:38 pm

Quoting PM (Reply 7):
The airline industry is - self-evidently - global. Protectionism here, subsidies there directly affect all airlines and none more than those with a global reach. Of course IAG have an interest in this dispute.

And they've done the same thing in the past (by this I mean the last years) I would agree. Moreover, if your main shareholder is one of the parties involved in the dispute you just don't interfere as some may not find your statements credible (not an unrealistic view).
 
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thekorean
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 5:49 pm

Has Doug Parker ever talked about ME3?
 
AABB777
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 5:51 pm

Quoting polot (Reply 1):
Why does IAG care about the whole US3 vs. ME3 dispute?
IAG cares about the issue because the US3 are actively traveling to Europe and to the UK to meet with their UK/European counterparts to get them to side with the US3. The US3 want European and the UK government to also review their respective ASA's with the UAE and Qatar. However, IAG (BA/IB) has not sided with the US3. This is something the ME3 should capitalize on because the UK (ie: LHR) is arguably the most competitive market in the world and faces the most competition from the ME3. Also, I find it hilarious that during this whole dispute, AA decides to announce a new codeshare agreement with EY from DFW.

[Edited 2015-05-15 10:53:38]
 
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cougar15
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 5:57 pm

Quoting LJ (Reply 5):
Why would IAG interfere in a dispute where they're not a party of? Nobody asked them to come with a press release which is very pro-ME3

... because they are open minded, believe in free markets and consumer CHOICE.... maybe/perhaps?

[Edited 2015-05-15 11:02:33]
some you lose, others you can´t win!
 
AAIL86
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 6:13 pm

Quoting cougar15 (Reply 12):
.. because they are opend minded, believe in free markets and consumer CHOICE.... maybe/perhaps?

Of all the potential reasons IAG is wading into this debate, I'd be very skeptical that its purely because of deep philosophical commitments.

In any corporate lobbying transaction, follow the money - that usually tells you a great deal about why.
The way to see by faith is to shut the eye of reason - Benjamim Franklin
 
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 6:20 pm

Quoting AAIL86 (Reply 13):
Of all the potential reasons IAG is wading into this debate, I'd be very skeptical that its purely because of deep philosophical commitments.

Quite a good comment and very true. IAG isn't wading into this for pure, altruistic reasons. No way. If a corporation is putting themselves out there like that, it is for a reason beneficial to the corporation, be it exposure, profit, or to cause its competitors some loss.
 
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speedbored
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 6:25 pm

Quoting AAIL86 (Reply 13):
In any corporate lobbying transaction, follow the money - that usually tells you a great deal about why.

I suspect a number of people are now going to make themselves look rather foolish by making incorrect assertions about what money is going where.
 
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Polot
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 6:43 pm

Quoting cougar15 (Reply 12):
... because they are open minded, believe in free markets and consumer CHOICE.... maybe/perhaps?

  
They aren't doing this out of the goodness of their heart. An open minded, pro consumer choice airline that believes in free markets also wouldn't be convicted of price fixing on fuel surcharges and cargo rates like a certain part of the IAG has.

IAG, through BA, is the least threatened EU airline/group in the US vs. ME debate, as they benefit from being based in the strongest O&D market from the US (LHR). They are also partially owned by QR which means money has exchanged hands between the two, unless IAG is just giving away parts of itself for free for some odd reason. Of course they are going to take the ME3 side.
 
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 7:36 pm

Quoting polot (Reply 16):
They are also partially owned by QR which means money has exchanged hands between the two, unless IAG is just giving away parts of itself for free for some odd reason. Of course they are going to take the ME3 side.

Qatar Airways purchased those shares on the open market, there was no exchange of money between the two entities.
 
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Ncfc99
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 7:43 pm

Quoting speedbored (Reply 15):
Quoting AAIL86 (Reply 13):
In any corporate lobbying transaction, follow the money - that usually tells you a great deal about why.

I suspect a number of people are now going to make themselves look rather foolish by making incorrect assertions about what money is going where.

Hahaha.........We didn't wait long. As you are so good at predictions, would you mind telling me this weeks lottery numbers?

Quoting polot (Reply 16):
They are also partially owned by QR which means money has exchanged hands between the two,

The money went from the buying shareholder (QR) to the seling shareholder. IAG gained nothing in the share transaction.
 
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speedbored
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 7:45 pm

Quoting polot (Reply 16):
They are also partially owned by QR which means money has exchanged hands between the two

No it does not.

Quoting polot (Reply 16):
unless IAG is just giving away parts of itself for free for some odd reason.

You really should go and learn a bit about company shares and how shareholders acquire them. It rarely involves any financial transaction between the company and shareholder.
 
LHRFlyer
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 7:59 pm

IAG has long been a proponent of full liberalisation and its view on the ME3 hasn't changed since QR acquired a 10% stake.

Willie Walsh has always said that he regards Emirates as behaving rationally and he has seen nothing from their accounts to indicate it's receiving any special subsidy. Nor does he have any issue with EY buying stakes in EU airlines.

IAG has also acknowledged the fact that they can't favour one individual shareholder so I doubt QR has had any influence over IAG's comments. QR doesn't even have a seat on the IAG board of directors so I can't see how they can exert pressure.
 
rta
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 8:11 pm

This keeps getting better. Didn't think IAG would want to get in the middle of all this.
 
AAIL86
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 8:11 pm

Quoting LHRFlyer (Reply 20):

IAG has long been a proponent of full liberalisation and its view on the ME3 hasn't changed since QR acquired a 10% stake.

Historically, so did the US3. As did KLM - they were one of the original drivers in the US-Netherlands open skies agreement back in the early 90s. Funny things do tend to happen when one's interests are threatened....

Again, follow the money.
The way to see by faith is to shut the eye of reason - Benjamim Franklin
 
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robffm2
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 8:35 pm

Quoting AABB777 (Reply 11):
IAG cares about the issue because the US3 are actively traveling to Europe and to the UK to meet with their UK/European counterparts to get them to side with the US3.

And I thougt the UK was still part of Europe...
 
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thekorean
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 8:49 pm

Quoting LHRFlyer (Reply 20):

As far as I know US3 don't own any shares of IAG so its not like he's favouring QR compared to other shareholders is it?
 
Eirules
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 9:36 pm

Is it just me or is AA the least vocal of the US3 on all of this? DL & UA seem to be doing far more shouting
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BaconButty
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 9:47 pm

Quoting thekorean (Reply 24):
As far as I know US3 don't own any shares of IAG so its not like he's favouring QR compared to other shareholders is it?

Please, this is desperate. You can be assured this is the view of the Board of Directors, these aren't the kind of people to be dictated to like that. Martin Broughton, for one, sold a company he was chairman of against the wishes of its shareholders. IAG believes it benefits from free markets and is using its voice to try to head off any reversal of liberalisation.

It would be nice to discuss the contents of the letter, which are actually very reasonable. Section 4 is a very candid take on the levels of support EU and US carriers have enjoyed:

Quote:
In the US, there are many rules that differ from other countries which could be interpreted by other nations and their airlines as “unfair”. These include Chapter 11 reorganisation procedures, which among other things has allowed airline pensions liabilities to be taken of carriers’ books, Fly America, where Government traffic must use US airlines (or their codeshare partners) not foreign airlines, the Department of Defense strategic airlift program, state and local air service development funding support, special state and local tax forgiveness incentive programs, and broadly, federal tax dollar support for research and development in aerospace. US airlines continue to be protected by ownership and control regulations which are more restrictive in the US than in many other countries.


[Edited 2015-05-15 14:56:04]
Down with that sort of thing!
 
AAIL86
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 10:10 pm

Quoting BaconButty (Reply 26):
IAG believes it benefits from free markets and is using its voice to try to head off any reversal of liberalisation.

So it's just a philosophical exercise, then? What is this, debate class in college? Humor me a little bit, what other great issues of the day are IAG issuing dossiers about? Whatever the outcome of this fight, its inconceivable that any US-EU opens skies agreements are in jeopardy because of the US3-ME3 tussle, which means this is extremely unlikely to affect BA/IB in any meaningful way.

A far better and more reasonable explanation is that IAG issued this to defend their biggest shareholder. Whatever your beliefs about who is in the right in this debate, its hard to see how that is a controversial proposition.
The way to see by faith is to shut the eye of reason - Benjamim Franklin
 
avek00
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 10:26 pm

Quoting EIRules (Reply 25):
Is it just me or is AA the least vocal of the US3 on all of this?
Quoting AAIL86 (Reply 28):
A far better and more reasonable explanation is that IAG issued this to defend their biggest shareholder.

It's not surprising that AA and BA-- generally speaking -- would be the least hotly opposed to the goings-on of the ME3.

For starters, QR is part of oneworld, and QF longhaul remains alive because of EK.

Second, in terms of the ability of the ME3 to scale up and cause damage, BA is based in (and the AA-BA JV centers on) the most restricted large airport in the Western world. Sure, competitors can and do fly out of other UK airports to their hearts' content, but they simply cannot wreak havoc on the crown jewel of Heathrow due to the lack of slots.

Third, United's and Delta's longhaul strategies are frankly more sophisticated than American's. Both carriers have "mastered the basics" and are now looking to increasingly exploit opportunities in thinner markets where the ability of the ME3 to even modestly distort capacity and pricing is impactful to route viability.
Live life to the fullest.
 
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BaconButty
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 11:05 pm

Quoting AAIL86 (Reply 28):
So it's just a philosophical exercise, then? What is this, debate class in college?

I think you're struggling a bit with comprehension. What I said was:

Quoting BaconButty (Reply 26):
IAG believes it benefits from free markets

I.e. that it will be a more profitable company when operating under liberal air service bilaterals. The possibility of one of its key markets retreating into protectionism will therefore be viewed as a long term threat to their profitability, so it's clearly not a philosophical argument.

Quoting AAIL86 (Reply 28):
its hard to see how that is a controversial proposition.

That the board of directors would have taken this position to satisfy a 10% shareholding? I'd say that's quite controversial, yes. In fact that's being more polite than it warrants. I'd say Occam's razor favours the more simple explanation that IAG issued the statement because it was felt to be in IAG's interest.
Down with that sort of thing!
 
AAIL86
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 11:42 pm

Quoting BaconButty (Reply 29):
I think you're struggling a bit with comprehension. What I said was:

Quoting BaconButty (Reply 26):
IAG believes it benefits from free markets

Hey now, there's no need for that. I do understand your perspective, I just think my explanation to be more likely.
You did not address the meat of my argument, which is that regardless of the outcome of the US3-ME3 debate, BA/IB's business will not likely be affected in any way, shape or form. No open skies agreement they currently benefit from is up for debate, nor is it likely to be opened whatever the result here.

Which leads to my conclusion - I highly doubt this stance from IAG is the result of an academic exercise. Ockham's razor, the simplest explanation - they are supporting their biggest shareholder. Nothing inherently wrong with that, I suppose...

[Edited 2015-05-15 16:43:21]

[Edited 2015-05-15 16:45:40]
The way to see by faith is to shut the eye of reason - Benjamim Franklin
 
Thomaas
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 11:43 pm

If anyone believes that IAG is doing this out of anything but self-interest they are fooling themselves. QR is not only IAG's largest shareholder (don't let the 10% number fool you, it is substantial when you consider that no one else has any meaningful share) but BA also benefits when its main competitors are weakened by the ME3. BA's focus on LHR means that its yields are unaffected by the ME3 because it can offer attractive non-stop options, which are always higher-yielding than connections, and feed the seats not taken by the large O&D with connections from its large North American network. IB has never had a substantial presence in Southeast Asia and the Middle East so the ME3 cater to completely different passengers. Remember when their was talk about one of the ME3 opening a hub for LATAM operations in either MAD or BCN ? You immediately saw IB protest against it. The day you'll see the ME3 directly going after IAG's EU-NA/SA city pairs is the day you'll see them change their discourse. Till then, they're more than happy to promote the "free" market, and really who are we kidding, BA has a monopoly on LHR slots and the very principles of free market favour breaking such a monopoly up to increase competition.
 
airzona11
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 11:52 pm

Quoting BaconButty (Reply 30):
That the board of directors would have taken this position to satisfy a 10% shareholding? I'd say that's quite controversial, yes. In fact that's being more polite than it warrants. I'd say Occam's razor favours the more simple explanation that IAG issued the statement because it was felt to be in IAG's interest.

It is not just a 10% shareholding, it is the LARGEST shareholder. This statement defends the interest of the LARGEST shareholder. This is true.

Qatar/Qatar Investment Authority/ Al-Baker are known to be outspoken and have been on this exact issue.

Correlation is not always causation, but something tells me Qatar (LARGEST Shareholder) is not sitting quietly on this issue.
 
AAIL86
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Fri May 15, 2015 11:52 pm

Quoting Thomaas (Reply 31):
If anyone believes that IAG is doing this out of anything but self-interest they are fooling themselves. QR is not only IAG's largest shareholder (don't let the 10% number fool you, it is substantial when you consider that no one else has any meaningful share) but BA also benefits when its main competitors are weakened by the ME3.

Exactly, good point. IAG also know that the status quo will likely result in the reduction of either LH group or AF/KL (my bet is AF/KL) to second tier carriers. Free markets and open skies are good when they benefit you (as in the US3 wanting open skies with Mexico, for example), but bad when they don't.
The way to see by faith is to shut the eye of reason - Benjamim Franklin
 
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BaconButty
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 12:00 am

Quoting AAIL86 (Reply 30):
You did not address the meat of my argument, which is that regardless of the outcome of the US3-EU3 debate, BA/IB's business will not likely be affected in any way, shape or form. No open skies agreement they currently benefit from is up for debate, nor is it likely to be opened whatever the result here.

Fair enough - although if the US were to renege on one open skies agreement, it would cast doubt over others. But there's more than that - BA would actually like greater liberalisation, specifically cabotage and lifting ownership restrictions. Any tilt towards protectionism would put the final nail in those particular coffins. Or maybe their motives are more "sinister" - to head off any attempt by the US airlines to bypass their European partners to South Asia, as Thomaas suggests in reply 31. But I really think you're underestimating the IAG Board members and management if you think they would have key company policy dictated to by a minority shareholding in that manner, there would be resignations. The biggest shame is that once again a thread on this subject matter is derailed, because regardless of motive, the IAG stance is highly cogent and well worth a read.

[Edited 2015-05-15 17:09:23]
Down with that sort of thing!
 
FAEDC3
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 12:08 am

I'm wondering why none of the posters defending this "conspiratiin theory" are pondering the fact that BA has very strong ties on the US. AA is their largest partner in OW and a huge network supplier in terms of passenger and connections, why would they undermine their partner if the arguments were not solid? I mean the imposition of limitations seeked by the US3 is as perjudicial to BA as to any airline flying to the US under the open skies treaty. Why is so far fetched that BA tries to put a flag out defending their business too?
Europe is also feeling the effect of the ME3 growth, BA has a position and they should have thought about the consequences of making it public, at the end, they can't change their position regarding their own turf.

Disqualifying other's opinion just because those opinions are contrary to one's position is just childlish and looks bad.
 
gkirk
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 12:19 am

Support the US3 = Denial of freedom for the consumer.


I thought the United States of Merca was all about freedom of choice?
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AngMoh
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 12:46 am

Quoting AAIL86 (Reply 27):
So it's just a philosophical exercise, then? What is this, debate class in college? Humor me a little bit, what other great issues of the day are IAG issuing dossiers about? Whatever the outcome of this fight, its inconceivable that any US-EU opens skies agreements are in jeopardy because of the US3-ME3 tussle, which means this is extremely unlikely to affect BA/IB in any meaningful way.

A far better and more reasonable explanation is that IAG issued this to defend their biggest shareholder. Whatever your beliefs about who is in the right in this debate, its hard to see how that is a controversial proposition.

A far better and more reasonable explanation is that IAG is concerned that any action against ME3 is also going to affect IAG. The Open Skies can not be cancelled as it is a signed agreement. To say that it should be cancelled is easy but in reality you can not one sided terminate bilateral international agreements unless you are a dictator running a banana republic. So instead there will be other small barrier. For example an A380 tax to slow down EK. Who will be the others affected by such a measure? BA and LH.
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VS11
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 1:13 am

Quoting AAIL86 (Reply 3):
Yes, its quite curious that IAG (Read: BA) is picking a side. I wonder why they feel the need....

Because BA are themselves beneficiaries of the same trade policies. They own the TATL traffic between the US and the UK.
 
BestWestern
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 1:16 am

Quoting VS11 (Reply 38):
They own the TATL traffic between the US and the UK.

All profits are shared with their north atlantic alliance partners

Quoting AngMoh (Reply 37):
For example an A380 tax to slow down EK. Who will be the others affected by such a measure? BA and LH.

Which will be seen to hurt a European product, and the WTO will get involved.


America Inc has more to lose from a cancellation of open skies with the gulf than it has to benefit from it. watch this space.
Greetings from Hong Kong.... a subsidiary of China Inc.
 
VS11
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 1:39 am

Quoting bestwestern (Reply 39):
Quoting VS11 (Reply 38):
They own the TATL traffic between the US and the UK.

All profits are shared with their north atlantic alliance partners

Sure they share the costs/profits but the very fact that they work together instead of competing against each other allows them to expand. BA's USA network and its profitability would be very different if they couldn't JV with AA (or another US carrier).
 
Chaostheory
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 1:42 am

Quoting avek00 (Reply 28):
Sure, competitors can and do fly out of other UK airports to their hearts' content, but they simply cannot wreak havoc on the crown jewel of Heathrow due to the lack of slots.

Yet the ME3 have more daily flights out of LHR than they do out of US3 hubs.

EK will have 5 daily flights this summer with an additional 2 daily QF flights.

EY will have 3 daily flights.

QR will have 6 daily flights.

How many of the US3 face that much competition from their hubs?
 
mdavies06
Posts: 545
Joined: Fri Aug 07, 2009 10:28 pm

RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 2:14 am

The US is IAG core market and BA is one of the largest foreign carrier. Protectionism hurts them more than anyone else. I'd even wager to say that IAG should be even more financially concerned about protectionism in the US than the ME3 because IAG is very reliant on the TATL market and will be even more so if and when they acquire EI.
 
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zeke
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 3:00 am

I congratulate IAG for their submission, they reflect my own views. IAG operate in an environment where they have domestic laws that results in higher corporate and individual taxes, something they cannot change. However on an operating level they have reinvested in equipment to maintain competitive direct operating costs.

When airlines like IAG where have higher taxes and costs than U.S carriers, and still are able not only to compete, it makes their whole argument baseless.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
ElPistolero
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 3:00 am

Quoting airzona11 (Reply 32):
Quoting Thomaas (Reply 31):
Quoting AAIL86 (Reply 33):

Of all the many arguments trotted out on this issue, the 'largest shareholder' argument is among the weakest. The logic underlying it is inherently flawed, because it fails to take into account one key element - namely the remaining 90% of IAG's shareholders.

Consider the obvious:

- EK is the largest of the ME3.
- EK has unfettered access to the UK
- EK provides serious competition to BA in key BA markets.

And who stands to gain the most from IAG's support for Open Skies? EK, of course.

All of which blows a massive hole in the 'largest shareholder ' argument, as if the adjective renders the remaining shareholders - that is to say 90% of IAG shareholders - incapacitated (or at the very least, mute and incapable of exercising their shareholder rights).

Perhaps we are expected to believe that 90% would go along with with QR's line just because of the adjective preceding QR's stake. Or perhaps we are expected to believe that 90% of IAG's shareholders are so sensitive to QR's feelings that they are willing to support policies that allow EK to make life a lot more uncomfortable for IAG.

Or there's the simple explanation - one that a certain William of Oakham/Guillaume d'Occam would find consistent with his ...err...razor: that IAG shareholders believe IAG benefits more from Open Skies, even with EK using it as a means to chip away at BA, than it would in a world without Open Skies. It's not a philosophical stance; its a cost-benefit analysis.

And for those who think reneging on Open Skies won't have knock on effects...good luck. I personally doubt it would take EY-backed 9W too long to get the Indian government to reopen its investigation into whether or not LH is using LX and OS to circumvent bilateral agreements. That should be fun to watch.
 
ElPistolero
Posts: 2050
Joined: Thu Feb 23, 2012 12:44 am

RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 3:24 am

Quoting AngMoh (Reply 37):
but in reality you can not one sided terminate bilateral international agreements unless you are a dictator running a banana republic.

Sure you can. Canada unilaterally terminated its bilateral agreement with Singapore in 1992, because of complaints from AC.
 
JAAlbert
Posts: 1980
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RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 3:50 am

Why anyone believes any side to this dispute is beyond me. The ME3 carriers suggesting that the US airlines received $71 billion (or whatever the figure was) is laughable (a terminal or airport used by all airlines, foreign and domestic, who elect to fly into the airportis a subsidy to US airlines???). The US3 running about crying that the sky is falling because ME3 are ramping up competition is ridiculous. That IAG is wading into a dispute it supposedly has no stake in, suggests an underlying motive.

The one comment that makes sense in IAG's response is that airlines should compete for passengers. Of course they should. The question is whether the competition among the world's airlines is on a level playing field. It would be nice to have some coherent arguments on this point (i.e. stop with the argument that the ME3 get fuel subsidies because there's a lot of oil in the middle east ) and it would be even nicer to have facts supporting those arguments. Really nice.
 
ElPistolero
Posts: 2050
Joined: Thu Feb 23, 2012 12:44 am

RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 4:05 am

Quoting JAAlbert (Reply 46):
The question is whether the competition among the world's airlines is on a level playing field.

I suspect you'll find the answer to that question the moment you find any sector in which all of the competitors are on a level playing field.

When a western airline sources blankets from China, I somehow suspect they don't investigate how level the playing field is for their compatriots.
 
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zeke
Posts: 15106
Joined: Thu Dec 14, 2006 1:42 pm

RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 4:19 am

Quoting JAAlbert (Reply 46):
The ME3 carriers suggesting that the US airlines received $71 billion (or whatever the figure was) is laughable (a terminal or airport used by all airlines, foreign and domestic, who elect to fly into the airportis a subsidy to US airlines???).

A point of order, the numbers presented in the economist (155 billion) were not calculated by the ME3, they were determined by a US congressional committee in 1999.

Quoting JAAlbert (Reply 46):
it would be even nicer to have facts supporting those arguments. Really nice.

There are facts available, like the source of where that number came from that that you thought was laughable. You need to educate yourself. The IAG submission is from an airline body that has done their homework.

Facts about DXB include, it is not the cheapest fuel around, it is not the cheapest landing fees, not the cheapest passenger fees, not the cheapest labor costs etc.

I should also point out, that IAG has also distanced itself from similar claims being made by Lufthansa and Air France well before this. They are being consistent.
Human rights lawyers are "ambulance chasers of the very worst kind.'" - Sky News
 
astuteman
Posts: 7146
Joined: Mon Jan 24, 2005 7:50 pm

RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 4:53 am

Quoting polot (Reply 16):
They are also partially owned by QR which means money has exchanged hands between the two

That is blatant misinformation.
IAG did not "sell" shares to QR - QR acquired them on the open market.
Why should IAG care what QR's wishes are?.
Especially as it's EK that benefits from the stance, not QR
IAG have held this stance a long time before QR took this stake in the group.

Quoting elmothehobo (Reply 17):
Qatar Airways purchased those shares on the open market, there was no exchange of money between the two entities.

Indeed.

Quoting AAIL86 (Reply 30):
I highly doubt this stance from IAG is the result of an academic exercise.

It stems from a strongly held view they have had for some time - one held strongly enough for them to disengage from a European Partnership as a result.
So this isn't an academic exercise - it's one that has already had far-reaching consequences with their ties to AF and LH

Quoting VS11 (Reply 38):
Because BA are themselves beneficiaries of the same trade policies. They own the TATL traffic between the US and the UK.

Common sense on this thread? how could you?  
Quoting mdavies06 (Reply 42):
The US is IAG core market and BA is one of the largest foreign carrier. Protectionism hurts them more than anyone else. I'd even wager to say that IAG should be even more financially concerned about protectionism in the US than the ME3 because IAG is very reliant on the TATL market and will be even more so if and when they acquire EI.

More common sense?

Quoting JAAlbert (Reply 46):
That IAG is wading into a dispute it supposedly has no stake in, suggests an underlying motive.

It does. see above

Rgds
 
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speedbored
Posts: 2230
Joined: Fri Jul 19, 2013 5:14 am

RE: IAG: US3 White Paper "Inaccurate" & "Misleading"

Sat May 16, 2015 6:37 am

Despite all the conspiracy theories being bandied around, I'm personally pretty sure that IAG have a lot more to lose by damaging their relationship with AA than by upsetting QR. A lot of thought and consideration would have gone into this statement before it was issued.

IAG have done a very good job of changing with the times and have adapted their business models to ensure that they remain competitive despite the evolving competitive landscape. I believe the US3 could learn a lot by studying what IAG have done and use that to help their businesses move with the times. Far better, IMO, to adapt to new competitive pressures rather than to try to implement protectionist measures to prevent them. Protectionism helps no-one in the long term.

Quoting ncfc99 (Reply 18):
As you are so good at predictions, would you mind telling me this weeks lottery numbers?

Sure: 08 13 20 28 41 48  

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