Dubai Airports chief fears moves towards aviation alliances

Shereen El Gazzar

The Dubai Airports chief executive yesterday warned that the international row over the expansion of Gulf carriers could result in a shift towards airline alliances, which are a much bigger threat to fair competition.

“My main concern – what could backfire with this – is that the spotlight would move away from the Middle East, where we are able to demonstrate clearly the successful commercial basis on which we operate, towards things like alliances, which are far more questionable in terms of distortion of competition,” said Paul Griffiths in an interview yesterday with the BBC.

Mr Griffiths is not the first to criticise alliances such as oneworld, SkyTeam and Star Alliance.

Last September, James Hogan, the chief executive of Etihad Airways, said the model is “fractured”.

Mr Hogan said that his airline achieved growth through partnerships, strong codeshare relationships and equity investments.

In recent weeks, tensions between Gulf carriers – namely Emirates, Etihad and Qatar Airways – and their European and US rivals, have escalated. In January, a US industry group including Delta, United and American Airlines, released a 55-page document detailing allegations of unfair government subsidies to Gulf carriers and other financial incentives that they claim were in breach of the open skies agreement.

The Gulf airlines have strenuously denied the allegations and promised to respond in detail to the claims. Neither Emirates nor Etihad are members of the large alliances, but Qatar is a member of oneworld. Yesterday, speaking about the growth of Dubai International, which toppled London’s Heathrow as the world’s busiest airport in terms of international passengers last year, Mr Griffiths said that the rate of expansion would continue amid regional competition because of its network, with direct flights to 280 cities worldwide.

Paul Griffiths said: “When you are putting through the airport 38 times the population of Dubai every year, it is a very fair question there.”

“We are not competing for the local market in Dubai. We are competing globally.”

Mr Griffiths highlighted restraints on global aviation capacity from limited airport infrastructure to be the major threat for the industry.

While rapidly growing hubs in Dubai, Abu Dhabi and Doha are ramping up their infrastructure to accommodate an increase in capacity, older airports such as Heathrow in London are struggling to expand.

Dubai opened its second international airport in Jebel Ali in 2013, Qatar opened Al Hamad International Airport last year and Abu Dhabi is slated to open its Midfield Terminal in 2017.

Follow The National’s Business section on Twitter

Share This Post