Willie Walsh, the chief executive of British Airways, has accused the European Union of financing the expansion of airlines in the Middle East. He says that the US/Europe deal that doesn’t allow credit guarantees to carriers based in the home countries of Airbus and Boeing, while allowing export credits to the Middle East, is the same as funding the Emirates’ expansion, which is happening so fast that it could change long-haul operations similar to how budget carriers have transformed short-haul operations.
Walsh also said that Europe has failed to see the significant threat of ambitious airlines in the Middle East. The UK and Europe have been very slow to recognize the new competitive threat, but they should be concerned about what’s going on. Under the US/Europe agreement, British Airways, Lufthansa and Air France-KLM can’t get the same access to export credit financing that airlines in the Emirates and Middle East can. This also applies to Ryanair.
Walsh says that these are their competitors, and they are financing them by giving them cheap access to capital. Something isn’t right here, and he doesn’t take this threat lightly, he continued, adding that this is a very big threat.
Emirates president Tim Clark says that carriers in the Middle East didn’t create the export credit regulations that Walsh is complaining about. They only use this credit for a minority of their planes, he continued. European governments are well aware of the importance of Emirates, which is the largest customer of the Airbus A380, to the aerospace industry in the region, he explained. The last thing the governments want to do is upset Emirates, as they are the only ones purchasing planes, he added.