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Gulf airlines say its youth not state aid which enables them to offer cheap flights

Gulf carriers such as Qatar Airways, Emirates and Etihad Airways which provide cheap flights across the Middle East say that the reason behind their success and purchase of 300 planes over the last three years is down to their youth, not state aid.

Gulf airlines say its youth not state aid which enables them to offer cheap flights

After purchasing nearly 300 planes worth $70 billion over the last three years, Gulf carriers, Etihad Airways, Qatar Airways and Emirates, say that their success in providing cheap flights in comparison to their western rivals has been down to their youth and not state aid.

The recent expansion of the three airlines has angered the Group Executive Officer of Air France-KLM, Pierre-Henri Gourgeon, who believes that Emirates has 3.5 billion Euros less outgoings a year because it is owned by the state of Dubai.

CEO of Etihad Airways, James Hogan, recently stated: "I've got one secret weapon and it's that I'm not a legacy carrier. If these chaps had been setting up an airline in the last seven years they'd be doing exactly what I am."

Air France said that the state-paid Gulf carriers have fewer outgoings than western airlines including lower taxes, airport charges and social levies, but the three Gulf airlines have hit back saying that they pay the same fees as older airline but just a lower rate because they are new to the market.

Emirates was founded 25 years ago by the Dubai government who gave a cash injection of $10 million but "not a penny since, contrary to what they're all saying," according to Tim Clark, the airline's president.

Western airlines are concerned that their rivals are providing more cheap flights for travellers because they are using more fuel-efficient aircraft such as Airbus A380 super jumbos.

Chris Logan, an analyst at Echelon Research in London, said: "If you're going between the U.S. and Asia you can start connecting through the Middle East and that's certainly a concern to the big European transfer carriers.

"And when you begin with a clean sheet of paper you don't have the heavily unionized workforces and overstaffing of the legacy carriers. The Gulf operators are effectively long-haul low cost airlines."

CEO of Oman Air, Peter Hill says that Middle Eastern operators show a greater flair for quality and ease of travel for travellers taking Oman holidays or Dubai holidays. He said: "It's all about commitment. You don't see the same connectivity, in-flight entertainment and investment in seats among European carriers."

The Gulf airlines also said that it was a myth that because of their region's oil wealth they automatically have lower fuel bills.
Etihad, the airline which is a popular choice of carrier for Abu Dhabi holidays, buys kerosene on international markets and often pays more in Abu Dhabi that at other airports.

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