How American Airlines And Qatar Airways Swerved From Bitter Enemies To Best Friends
Pandemics make strange bedfellows.
In particular, American Airlines and Qatar Airways have become chummy, moving far beyond the mutual enmity they displayed during most of the second half of the last decade, when they battled over the subsidized Middle East carriers’ access to U.S. markets.
Last week, American Chief Revenue Officer Vasu Raja said Qatar has “very quickly become our longest long-haul codeshare partner.”
Why the reversal?
Sara Nelson, president of the Association of Flight Attendants, says things changed after Qatar CEO Akbar Al Baker agreed to “play by the rules (because) nothing else worked.
“When you play by the rules you get to play with everyone in the play yard,” Nelson said in an interview.
Whatever the reason, Qatar and Al Baker seems to have emerged from the conflict better off than when they started. In May, he was named CEO of the Oneworld global airline alliance, which is anchored by American and British Airways.
Meanwhile, Qatar has been growing rapidly in the U.S., able to boast in a press release that it continues “to strengthen its position as the leading international airline connecting the United States with Africa, Asia and the Middle East.”
At one point during the contentious summer of 2017, Qatar sought to acquire 10% of American. American opposed the effort, which Qatar abandoned: American then canceled code shares. Also that summer, Al Baker insulted U.S. flight attendants, referring to them as “grandmothers,” then apologized.
The conflict over flights was largely resolved with 2018 deals that allowed U.S. carriers to review accounting by Emirates, Etihad Airways and Qatar, while the airlines agreed not to add additional direct flights to the U.S. from Europe or other third country destinations.
Subsequently, the pandemic brought a halt to most international travel. In May 2020, the American-Qatar code share was restored.
On American’s July 22nd earnings call, Raja discussed American’s strategy, accelerated during the pandemic, to partner with other carriers.
“We see a lot of opportunities through partnerships that we’ve envisioned and created since the pandemic with — not just with JetBlue and Alaska, which create really great jump-off points for international — but also with Qatar Airways, who’s very quickly become our largest long-haul codeshare partner,” he said.
The partnerships “will open up new markets for us that wouldn’t have been viable for our customers or for us financially prior to this,” Raja said.
Labor leaders questioned the new arrangements.
To Dennis Tajer, spokesman for the Allied Pilots Association, which represents 15,000 American pilots, all of the code sharing with the three partners threatens jobs.
“At American, most of these asymmetric marketing schemes usually mean more flying for the partner than for American pilots,” Tajer said. “Whether it be a partnership with Qatar or JetBlue, they’re often just the appearance of market presence.”
Regarding the Qatar acquisition effort, Tajer said, “Not long ago, Qatar came knocking at our door trying to buy the furniture with an unwanted investment and now management invites them to share our house. How times change.”
AFA, which Nelson heads, represents 50,000 flight attendants at 14 airlines including three American subsidiaries. She said the American/Qatar alliance indicates that al- Bakar “has been beaten into submission.”
Aviation unions joined American management in “staving off a Qatar takeover of ownership in American,” Nelson said. They also worked closely in securing $39 billion from Congress to pay airline employees during the pandemic. “It was a massive unprecedented alliance between labor and the airlines,” she said.
As for Al Baker, “We fought him every way we could,” she said.
“I still have a beef with their being a state-owned airline and with the they treat workers, but he has decided to play by the rules,” she said.
A New York-based representative for Qatar said, “It is important to note that Qatar Airways has played by the rules and continues to do so.” Both Qatar and American “have worked hard to develop and grow the relationship that is mutually beneficially to our passengers,” she said.
Qatar now serves 12 U.S. destinations. Partners include not only American but also Alaska and JetBlue.
This summer, four Qatar U.S. gateways – Chicago, Los Angeles, New York and Washington – have twice daily departures. Dallas has 12 weekly departures, while Boston, Houston, Miami, Philadelphia, San Francisco and Seattle have daily departures. Atlanta and Philadelphia both have five weekly flights.
Except for Charlotte and Phoenix, all of American’s international hubs have Qatar flights to Doha.
Qatar now has its code on about 1,600 American Airlines flights in the U.S., Caribbean and Canada. American has its code on Qatar flights between the U.S. and Doha.
In a February 2020 prepared statement, American CEO Doug Parker said, “The issues that led to the suspension of our partnership two years ago have been addressed. We look forward to the renewed cooperation between our airlines and hope to build an even stronger relationship with Qatar Airways over time.”