Exclusive: U.S. airlines disclose details of bookings lost to Gulf carriers

Wed Feb 11, 2015 11:16am EST
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By Jeffrey Dastin

(Reuters) - U.S. airlines have lost at least five percentage points of their share of flight bookings from the United States to the Indian subcontinent and Southeast Asia since 2008, due to fierce competition from Gulf carriers, according to data seen by Reuters.

More recently, U.S. carriers have seen an erosion in their share of bookings to Milan, according to a report the U.S. airlines sent to the White House and the departments of State, Transportation and Commerce. The 55-page white paper is not yet public.

The report says the combined share of bookings between the United States and the Indian subcontinent for Delta Air Lines (DAL.N: Quote), United Airlines (UAL.N: Quote) and American Airlines (AAL.O: Quote) has fallen to 34 percent in 2014 from 39 percent in 2008. The drop includes bookings on the airlines' joint-venture partners, such as British Airways (ICAG.L: Quote) and Air France (AIRF.PA: Quote).

In the same time, Emirates Airline, Qatar Airways and Etihad Airways have surpassed them. The Gulf airlines' share of that market has jumped to 40 percent from only 12 percent seven years ago, according to the report.

The report sheds light on the intensifying battle between the U.S. carriers and their rivals from Qatar and the United Arab Emirates since "Open Skies" agreements authorized commercial flights between those countries and the United States more than a decade ago.

The data shows that the Gulf carriers have eroded U.S. airlines' market share even beyond the subcontinent, although bookings to the region resulted in the largest revenue hit so far, Delta Chief Legal Officer Ben Hirst said in a telephone interview.

U.S. airlines and their joint-venture partners' share has fallen to 36 percent from 43 percent of the market between the eastern United States and Southeast Asia, according to the report. The region includes Vietnam, Thailand, Indonesia, Malaysia and the Philippines.

Gulf carriers, meanwhile, expanded their share of bookings to 13 percent from just 1 percent.   Continued...

A passenger plane approaches Ted Stevens Anchorage International Airport on a cold and clear day in Achorage, Alaska, November 8, 2011. REUTERS/Nathaniel Wilder