JetBlue Awarded Government Contract for Service to Dubai in 2016 — But There is One Minor Detail…
“I n August, the General Services Administration (GSA) announced that it awarded the U.S. government contract for 2016 on the Washington-Dubai route to JetBlue” is the statement which appears in this article at the official news site of United Airlines known as United Hub — but there is one minor detail: “JetBlue has no service to the Middle East and no presence in the region.”
JetBlue Awarded Government Contract for Service to Dubai — But Which Airline Benefits Most?
You read that correctly: an airline based in the United States was awarded a contract with the United States government for a flight to a city in the Middle East even though most of its airplanes never leave the North American continent — save for several destinations in northern South America…
…so which airline was actually “awarded” the route?
The Ultimate Codeshare — or The Ultimate in Outsourcing?
Emirates Airline — which is an official codeshare partner with JetBlue — will be solely operating this route and will be carrying an estimated 15,000 government employees of the United States, which includes active duty military personnel whose official travel is funded by taxpayers of the United States.
Reduced Service to Dubai by Airlines Based in the United States
As a result of this news in what is considered to be the latest in the escalating war between the three legacy carriers based in the United States and the three largest airlines based in the Persian Gulf region, United Airlines is discontinuing its service between Washington Dulles Airport and Dubai. The last departure from Washington Dulles Airport to Dubai will be on Saturday, January 23, 2016; and the last departure from Dubai will be on Monday, January 25, 2016.
Even though we successfully operated the Washington-Dubai route for the past seven years, the entry of subsidized carriers such as Emirates Airline and Etihad Airways into the Washington, D.C. market has created an imbalance between supply and demand to the United Arab Emirates. As they’ve added subsidized capacity, our Washington-Dubai route has become less profitable.
“It is unfortunate that the GSA awarded this route to an airline that has no service to the Middle East and will rely entirely on a subsidized foreign carrier to transport U.S. government employees, military personnel and contractors,” said Steve Morrissey, who is the regulatory and policy vice president at United Airlines. “We believe this decision violates the intent of the Fly America Act, which expressly limits the U.S. government from procuring commercial airline services directly from a non-U.S. carrier. For the Washington to Dubai route, JetBlue merely serves as a booking agent for Emirates.”
Lufthansa Group and Air Canada will continue to serve Dubai for those who seek to use commercial airlines who are members of Star Alliance.
This news follows an official announcement on Wednesday, October 28, 2015 from Delta Air Lines that effective as of Thursday, February 11, 2016, the carrier will no longer provide commercial air service between Atlanta and Dubai. “The announcement comes amid overcapacity on U.S. routes to the Middle East operated by government-owned and heavily subsidized airlines, and less than a month after Delta reduced service between the world’s busiest airport and the Middle East’s largest hub.”
Leaders of the three legacy airlines based in the United States continuously claim that the three largest airlines based in the Persian Gulf region have expanded rapidly with illegal government subsidies totaling a minimum of $42 billion and that they cannot compete.
“Of all airlines in the world, 49 percent [of profit] is made by the three American carriers…what more do they want?” Akbar al-Baker — who is the chief executive officer of Qatar Airways — reportedly asked at a press conference in New York, according to this article written by Jessica Plautz of Mashable. He then reportedly said of Richard Anderson — who is the chief executive officer of Delta Air Lines — “Let him come face to face with me in any forum. I will hang him on a wall.”
That is not the first time that al-Baker has launched a verbal missive at Anderson, as this gem was reportedly said back in March of 2015: “I am delighted that Richard Anderson of Delta is not here. First of all, we don’t fly crap airplanes that are 35 years old. The Qatar Airways average fleet (age) is only four years and one month.”
When I hypothetically asked whether or not the three airlines based in the Persian Gulf region could sustain a prolonged period of lower fuel prices — if indeed they were being subsidized illegally by their respective governments, as the chief executive officers of the three legacy airlines based in the United States allege — a reader of The Gate who goes by the name Paul posted this comment: “Our own economy hasn’t been doing great for a while now and we are continuing subsidizing American/United/Delta. What makes you think this wouldn’t be the case for the Middle East?”
It is time for all of the airlines involved to come clean and show their cards. All of these allegations and accusations being thrown back and forth is not doing anyone any good, in my opinion — but then, what do I know?…
…and the General Services Administration announcing that it awarded the United States government contract for 2016 on the Washington-Dubai route to JetBlue just seems odd at best. Did JetBlue offer a bid significant low enough as compared to its domestic competition — and if so, could that bid possibly have been subsidized by Emirates Airline?
I would like to hear your thoughts on what has become a debacle in terms of relations between the six airlines in question.
Photograph ©2015 by Brian Cohen.