Etihad Airways plans to close its Abu Dhabi-Dallas/Fort Worth (DFW) route effective March 25, in the first service suspension the Persian Gulf airline has announced in reaction to American Airlines’s decision to end the partners’ code-share agreement. The decision comes some five months after American notified both Etihad and fellow Gulf carrier Qatar Airways of its intention to sever code-share ties next March. American sent the notifications on June 29 in protest of what it and the other major U.S. carriers characterize as illegal subsidies from the governments of Qatar and the United Arab Emirates to the respective OneWorld alliance partners.
“The cancellation of the Dallas route is one of several adjustments that we are making to our U.S. network in 2018 in order to improve system profitability,” said Etihad CEO Peter Baumgartner. “Further changes are possible as we monitor the full impact of the American Airlines code-share cancellation on summer 2018 bookings.”
Etihad has invested heavily in the DFW route since its launch in December 2014. The route started as a three-times-weekly service and upgraded to a daily service in February. The airline indicated that more than 235,000 travelers have flown on the route since its launch, and that almost half of Etihad’s customers connect on U.S. code share flights operated by American Airlines.
“We are open to American Airlines reversing its decision to cancel our code-share agreement so that Etihad Airways can continue the route and together protect and support American national interests and global connectivity while driving commercial value for both airlines,” said Baumgartner. Etihad now operates 42 nonstop flights a week to five U.S. gateways—Chicago, Dallas/Fort Worth, Los Angeles, New York and Washington.
American, however, appears less concerned about losing passengers on connecting flights fed by Etihad. In fact, in a statement issued in July, American said the ending of the code-share pacts would not hurt it financially. “This decision has no material financial impact on American and is an extension of our stance against the illegal subsidies that these carriers receive from their governments,” it said. “We are committed to doing everything we can to continue to support our team members and ensure that there is fair competition between American and the Gulf carriers.”
Citing statistics gathered through independent research by Oxford Economics, Etihad reports that in 2016 it contributed $3.8 billion to the U.S. economy, supported more than 30,000 U.S. jobs and brought 280,000 additional visitors to the country. Those visitors, who traveled from markets Etihad describes as historically ignored by U.S. carriers and partners, contributed $1.9 billion to the U.S. economy and supported an additional 22,000 American jobs, according to Oxford’s research.
The three major U.S. airlines, namely American, United and Delta Air Lines, accuse Etihad, Qatar Airways and Emirates Airline of violating Open Skies agreements through their governments’ support of their operations. The dispute dates to 2015, when the U.S. carriers called on the administration of then President Barack Obama to modify or end Open Skies trade agreements the U.S. negotiated with Qatar and the UAE between 1999 and 2002. Now the airlines and their lobbyists have taken their complaints to the Trump Administration, which they hope will prove more receptive.