Fifth Freedom Flights: The US Political Debate

Fifth Freedom Flights

“There are 7 “Freedom of the Air” commercial aviation rights. The fifth freedom allows an airline to carry revenue traffic between foreign countries as a part of services connecting the airline’s own country. It is the right to carry passengers from one’s own country to a second country, and from that country to a third country.”(flypointyend.com) 

“Singapore Airlines, for example, fifth freedom flights enable you to try a new carrier and also give customers more flight options to choose from. In many cases, these carriers offer better products, departure times, and overall service than their U.S. based competitors on these routes. Especially in instances, where you can choose an airline like Singapore or Cathay Pacific who regularly top the best airline awards over a local carrier’s offering. Emirates began offering a year-round nonstop option from Newark (EWR) to Athens (ATH) last year, before continuing to its base in Dubai (DXB). Home to a large Greek population, Emirates saw an opportunity in the New York/New Jersey market and exercised its fifth freedom rights to start service on the route, much to United Airline’s chagrin. While the Emirates move drew the ire from some U.S. based airline higher-ups, it also provided customers with a new connectionless option and has brought healthy competition into the market where United routinely calls the shots. Now, flights to Athens are hundreds of dollars less on average than what was being listed several years ago.” (airfarewatchdog)

“Emirates’ fifth freedom routes between Europe and the US are very upsetting to United and Delta, but can be a great opportunity to experience Emirates’ award-winning service without going all the way to Dubai. JAL Mileage Bank miles are the best way to book these routes.

  • JFK-Milan in Economy: 21,000 miles one way
  • JFK-Milan in Business: 60,000 miles one way
  • JFK-Milan in First: 65,000 miles one way
  • Newark-Athens in Economy: 37,000 miles one way
  • Newark-Athens in Business: 60,000 miles one way
  • Newark-Athens in First: 90,000 miles one way” (forbes.com)

“Open Skies pacts are intended to level the playing field among international carriers by eliminating government subsidies to airlines and curtailing political involvement in business decisions such as routes and pricing. The agreements are very common; the U.S. maintains Open Skies arrangements with 126 countries throughout the world. In an overwhelming majority of instances, the agreements are followed and respected. America’s Open Skies pact with Qatar is a rare and troubling exception. After using tens of billions of dollars in government funds to underwrite Qatar Airways, the Persian Gulf nation signed an Open Skies agreement and pledged to stop funneling subsidies to the airline. Just last year, however, Qatar was suspected of again using tax dollars and other government funds to subsidize Qatar Airways.” (townhall.com)

“Munoz and Bastian, along with American CEO Doug Parker, said the two nations are violating that deal. They urged the Trump administration to “act decisively” to curb the backdoor subsidies that they say send “a message to other countries that they can take advantage of the United States without consequence. If Qatar and the UAE aren’t willing to uphold their side of the deals, the United States should consider removing itself from these two Open Skies treaties altogether, they wrote. The trio also said Qatar is breaching its pledge to not fly between the U.S. and Europe with its investment in a regional Italian airline and using the new Air Italy to conduct those routes. The U.S. Travel Association, however, is blasting the carriers, instead claiming that the agreement is providing “immense benefits to the U.S. economy, jobs base and exports” and warning that “considerable harm” is possible if the deal is dissolved. Apart from the Big Three, the entirety of the U.S. travel and tourism industry—including the rest of the aviation sector — strongly supports keeping Open Skies intact,” said Tori Barnes, executive vice president for public affairs and policy.” (foxbusiness.com)

“Trump sides with the middle east over US Airlines. CEOs of most major US airlines met with President Donald Trump and Vice President Mike Pence Thursday afternoon, they hoped — and expected — to make progress in their quest to penalize Middle Eastern airlines — particularly Qatar — for their alleged unfair competitive practices. The executives left the White House without securing any commitment to intervene in the dispute, despite the administration’s inclination toward protectionist trade policies, according to a report from CNBC. The root of the issue is a small recently rebranded and expanded Italian airline, Air Italy. Qatar Airways has a minority stake in the airline, which flies to several locations in the US. The US airlines, in a lobbying coalition, argue that Air Italy’s flights represent illegal “fifth freedom” flights — flights in which an airline flies between two countries that are not it’s own. Those flights are highly regulated and typically must originate or end in the airline’s home country after making a stop in the third. Executives from other airlines and industries have argued that, since Qatar is not the majority owner of Air Italy, there is no violation of the Open Skies trade treaty that regulates international air travel.” (businessinsider.com)

This makes for a very interesting and complex situation moving forward in the global aviation marketplace. There are many sides to this coin to consider and there are no easy answers to any of them. The one hand there is the situation of US job security for US Airline crews. If the global airlines outside of the United States take over the market share then US jobs could be lost due to routes being cut from low bookings. However, on another hand, these routes give US consumers the opportunity for a much better service and flying experience on the same route for often less money.  US airlines feel that they can not compete with luxury carriers which have government-subsidized funding for their cabin interiors and foodservice offerings. The US airlines create their products strictly based upon their profit margins and budgets per seat miles flown on the route. If the US goes after the International Airlines and tightens the protectionism for America then this could unravel all the hard work done over the years. It could even place the entire Open Skies Treaty into jeopardy just to appease some US Airline CEOs.

This is much like our trade situations with China, Iran, and Mexico. Every action creates a counter-reaction. If America places restrictions on the international marketplace then they can also in turn place restrictions on America and US access to their countries. Baker the CEO of Qatar is a tyrant, a despicable human being and is guilty of many human rights violations. Yet, he should still have the right to operate his flights that they have invested in at Air Italy.  He also flew all the way from Qatar to attend the meeting with the President. Baker was at least making an effort for diplomacy and to make his position known in a very hostile meeting in DC with his competitors which were in attendance there against him. Bastian from Delta was a no show and did not attend. This snub did not sit well with the President or the position of the other CEO’s Parker and Munoz who were in attendance. Baker made a remark that he traveled all the way across the world to be there and Bastian could not even take a 1 hr and 15 min flight to attend. If it was that important to Delta then he should have made more of an effort to make his position in person.

This may have been part of Trump’s weak response towards the other US CEOs in attendance. Therefore, in this case, I am for once in agreement with Trump that this is not a situation that calls for a Presidential Executive Order. He has instead left it for the normal legal grievance process to decide their complaint resolution. It is not good for America as a whole to rock the boat with our current Open Skies and Fifth Freedom Flights policy. It is best to just let the international marketplace compete on its own and let the chips fall where they may. The prospect of losing our US global access to countries around the world is far more harmful to aviation. This would be much worse than just allowing a few luxury carriers to fly their Fifth Freedom Flights without any restrictive US legislative policy attacks against them.

 

Link: flypointyend.com

Link: airfarewatchdog.com

Link: forbes.com

Link: townhall.com

Link: foxbusiness.com

Link: businessinsider.com

 

Aviation Travel Writer: The Flight Times Blog

https://aviationtravelwriter.com/

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 


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