American Airlines CEO: We’re not pleased about Qatar Airways buying stock


Business News - Opportunities - Reviews



American Airlines CEO: We’re not pleased about Qatar Airways buying our stock – Jun. 22, 2017

qatar airways american airlines

American Airlines is not thrilled about Qatar Airways’ desire to acquire a 10% stake in the U.S. airline.

CEO Doug Parker sent a letter to America Airlines employees after news hit Thursday that Qatar Airways wants to buy at least $808 million worth of stock in American (AAL), the world’s largest airline.

‘; var storytext = document.getElementById(‘storytext’); var heightToSkip = 0; function resetValues() { totalHeight = 0; targetChildElement = null; } if(storytext == null) { console.log(“Error finding storytext element for SA embed”); return; } for ( i = 0; i 0) { heightToSkip -= storytext.childNodes[i].clientHeight; resetValues(); } else if(heightToSkip minHeight && targetChildElement != null) { //console.log(“total height = ” + totalHeight); //console.log(“childNode = ” + targetChildElement); storytext.childNodes[targetChildElement].insertAdjacentHTML(‘afterend’, smartAssetDiv); smartasset = document.getElementById(‘smartasset-article’); = ‘left’; // allows module to have text float to right =’20px’; =’25px’; //console.log(storytext.childNodes[targetChildElement]); //SMARTASSET.setDivIndex(targetChildElement); SMARTASSET.setSmartAssetScript(); /* bail out since we’re done */ break; } } /* div with id=”smartassetcontainer”. Sanity check to only embed once */ else if (storytext.childNodes[i].nodeName.toLowerCase() === ‘div’ && storytext.childNodes[i].id !== “undefined” && storytext.childNodes[i].id === “smartassetcontainer”) { break; } /* div with id=”ie_column” */ else if (storytext.childNodes[i].nodeName.toLowerCase() === ‘div’ && storytext.childNodes[i].id !== “undefined” && storytext.childNodes[i].id === “ie_column”) { resetValues(); } /* embeds from twitter, facebook, youtube */ else if (storytext.childNodes[i].nodeName.toLowerCase() === ‘div’ && storytext.childNodes[i].classList.contains(’embed’)) { resetValues(); } /* cnn video player */ else if (storytext.childNodes[i].nodeName.toLowerCase() === ‘div’ && storytext.childNodes[i].classList.contains(‘cnnplayer’)) { resetValues(); } /* images */ else if (storytext.childNodes[i].nodeName.toLowerCase() === ‘img’) { resetValues(); } /* images stored in figure tags */ else if (storytext.childNodes[i].nodeName.toLowerCase() === ‘figure’) { if(storytext.childNodes[i].clientWidth

In the letter, Parker said American executives “aren’t particularly excited” about Qatar’s interest in acquiring a big stake in the company, but admitted that there’s nothing they can do about it.

“We cannot control who sells or purchases” our stock, Parker said.

American and other airlines, including Delta (DAL) and United (UAL), have accused state-run Qatar Airways — along with United Arab Emirates airlines Emirates and Etihad — of getting unfair financial backing from their respective governments. They claim that violates existing aviation agreements with the U.S.

The U.S. carriers say those subsidies have allowed the Gulf airlines to rapidly expand in the U.S., giving them an unfair advantage and hurting U.S. jobs.

The Gulf airlines deny those claims.

Related: Qatar Airways wants to buy 10% of American Airlines

The U.S. airlines are pressing President Trump’s administration to review the Open Skies agreements that give Gulf carriers the unfettered ability to fly to U.S. destinations and across U.S. airspace. The agreements extend reciprocal access to U.S. carriers.

Parker said in his letter that American Airlines “will not be discouraged or dissuaded from our full court press in Washington, D.C., to stand up to companies that are illegally subsidized by their governments.”

“If anything, this development strengthens our resolve to ensure the U.S. government enforces its trade agreements regarding fair competition with Gulf carriers,” Parker wrote.

Parker also told employees there’s a limit to how many American Airlines shares — and thus how much influence — Qatar Airways can hold. Per federal law, foreign entities cannot own more than 24.9% of a U.S. company.

American Airlines shares climbed 3% after reports of the unsolicited approach from Qatar Airways.

Qatar Airways did not immediately respond to a request for comment about Parker’s letter.

The move by Qatar could be part of an effort to expand its investments in other members of the OneWorld alliance. Both Qatar Airways and American Airlines are members of the group — which promotes coordination among its members to ease travel pains for international fliers.

Managing director at aviation consultancy firm Aerotask, Rob Watts, said Qatar’s investment in American could serve to help block increased coordination between American and other Gulf carriers. Qatar already owns stakes in International Consolidated Airlines Group (BABWF) (parent of British Airways and Spain’s Iberia), and LATAM Airlines (LTM).

Qatar is the richest county in the world, per capita. Its state-run airway has been under economic pressure as its neighbors have sought to implement an embargo against the country over a political dispute. Qatar Airways can no longer fly to more than a dozen locations in Saudi Arabia, the UAE and Bahrain. The blockade has grounded an estimated 50 flights per day. The State Department this week criticized the blockade of Qatar, saying its rivals have yet to detail proof that the small nation is a state sponsor of terrorism. Qatar has denied the accusation.

–CNNMoney’s Zahraa Alkhalisi contributed to this report

CNNMoney (New York) First published June 22, 2017: 5:24 PM ET


Business News - Opportunities - Reviews



Leave a Reply