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Middle East Airlines Edging European Rivals on Asia Routes

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Emirantes is one of the 'new kids' on the block with deep pockets to expand.
  • Why it matters

    Why it matters

    Aviation regulations from a bygone era are hindering European airlines in the competition against Middle Eastern carriers for travel to Asia.

  • Facts

    Facts

    • Abu Dhabi-based Etihad Airways has ownership control over Germany’s Air Berlin.
    • Germany’s federal minister of transport wants to reform country’s air traffic regulations.
    • Growth in the airline industry is taking place primarily outside Europe.
  • Audio

    Audio

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Etihad Airways out of Abu Dhabi is headed for Europe.  The emerging airline has just secured 49 percent of Italy’s Alitalia. It already owns 29 percent of Germany’s Air Berlin and 3 percent of Irish airline Aer Lingus, and is interested in Swiss regional carrier Darwin. The Gulf airline also has a cooperation with Air France-KLM.

But many are asking whether financially troubled Air Berlin has any future at all. Until now, Etihad’s money has been able to prevent the worst at the German carrier but there are limits set to its rescue efforts. By law, non-European stockholders are not allowed to own more than 49.9 percent of a domestic airline, otherwise, valuable air traffic rights might be lost.

The old world of aviation has lots of regulations like this, all of which date to a time when international air traffic largely took place between the industrially developed nations. The object was to protect domestic aviation from unwelcome aggressors. Shaped by experiences of the Cold War, matters of national sovereignty stood at the center of these regulations.

The fact that we can’t continue with the old regulations in a changed new world is also dawning on those with responsibility for the issue in the German federal government. Germany’s federal minister of transport, Alexander Dobrindt, is urging for a modernization of the country’s concept of air traffic.

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