The main ME3 airport, Dubai, in action
The main ME3 airport, Dubai, in action

Remember the campaign by the US3 (American, Delta, United) against the wicked sovereign owned ME3 (Emirates, Etihad, Qatar Airways)? Its fallen in a heap, and America will take no action against them.

The case argued by the major American carriers failed on every non-emotive count, and it would appear that unless a President Trump turns up to build a wall in the sky, the so-called invasion of US airports by squadrons of A380s and 777s will continue apace.

One of the key metrics to emerge unopposed in the long running public and government level debate was that of the 1,700 routes flown by the US 3 and ME3 carriers they competed head-to-head on a mere two of them. Only 0.7 per cent of passengers who flew on an American, Delta or United flight to the US could have flown the same route on a Gulf carrier. The direct impact on the US3 by the ME3 was vanishingly small, despite the irritation caused to them by their presence.

What might this mean in Australia, where the ME3, predominantly through the services of Emirates, provide almost all of the lift to all of Europe, northern and middle Africa, central Asia and the Middle East itself?

It probably underlines the role the ME3 play in providing air services to non-Anglo non-traditional destinations that offer far more to the future prosperity of Australian exporters and inbound tourism operators than the stuck-on-the-past mind set of Qantas in the days when it tried to send everyone flying anywhere as far east as Russia or Turkey through London Heathrow.

The arguments heard in Australia that restrictions should be placed on the ME carriers to protect the interest of Australian jobs were among the dumbest to get media space for a long time. Qantas would never have gotten out of its own way to even think of such routes in its own right, and while some of the excuses offered were operationally valid, they weren’t a reason to cripple the national economy in terms of shutting off the dozens of one stop links to greater Europe that Emirates, Etihad and Qatar are providing.

Of course Qantas and Virgin Australia have now forged strong alliance links with Emirates and Etihad respectively, and the biggest threats to the ME3 are probably their own geopolitical risks and the determination of Singapore Airlines, and perhaps in time, Indonesian flag carriers to make flying via Asia even more attractive than is already the case with Changi airport.

What about China? The rather poorly negotiated traffic treaties between China and Australia are predicated on the growth of China originating travel to Australia. The reality is that China’s carriers don’t have any serious, high volume interest in providing Australia-Europe capacity except around the edges.  With the opportunity to charge higher fares between China and Europe than those offered for flights via Singapore, Dubai, Abu Dhabi or Doha, there is no immediate prospect of 100 or more large jets flying from here to Europe via China each week when the ‘local’ trade is so much more important.

Free trade agreements and open skies issues are likely to rise in prominence in the new parliament given the astonishing miscalculation by PM Turnbull and his strategists in relation to a double dissolution election producing a Senate with an unprecedented number of populist protectionist senators.

The US decision could thus prove an important object lesson as the free trade arguments in this country turn to issues like open access by foreign airlines.

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