FedEx Reverses Policy Stance in New Docket Submission Flip Flops on Need for Level Playing Field, Trade Enforcement
In a letter submitted to the U.S. Departments of State, Commerce and Transportation today, the Partnership for Open & Fair Skies highlighted numerous contradictory statements in FedEx Corporation’s recent submission to the U.S. government’s docket on Open Skies and raised questions about the hypocrisy of the cargo carrier’s position.
“Regrettably, the submission by FedEx avoids confronting the difficult questions that the massive Gulf subsidies raise for U.S. Open Skies policy,” the letter said. “It also makes no effort to reconcile the position FedEx is taking here with the position it traditionally takes on such issues, as FedEx has long been a chief proponent of active U.S. government action to discipline unfair competition from subsidized foreign state-owned enterprises (SOEs) when its own commercial interests have been at stake.”
The letter cites a September 21, 2012 hearing on the Trans-Pacific Partnership (TPP) Agreement, where FedEx testified that:
‘The issue is as we go forward with postal units around the world, they have been subsidized by their governments, and then they compete in the express delivery business. That is a safeguard that we want. We are very happy to compete on a level playing field, but we don’t want subsidies to the postal units to come into express businesses and then compete with us in an unfair advantage.’
“As FedEx has persuasively argued in the past, subsidies distort the level playing field by giving unfair advantages to their recipients, and it is entirely appropriate for the U.S. government to take action to safeguard U.S. companies from their effects,” the letter says.
“It is wildly hypocritical for FedEx to demand that the U.S. government include provisions in trade agreements to protect it from subsidized foreign competition, but take the opposite position when it affects others,” said Jill Zuckman, chief spokesperson for the Partnership for Open & Fair Skies.
“FedEx also claims that we are fighting against Open Skies agreements, but this is completely inaccurate,” Zuckman said. “American, Delta, and United have advocated for open aviation markets around the world for decades and strongly support Open Skies. We are asking our government to enforce the rules of these agreements. The massive government subsidies and other unfair benefits Qatar and the UAE have provided to their state-owned airlines threaten to undermine Open Skies – causing harm to U.S. passenger airlines and employees.”
The letter was signed by Howard Kass, VP of Regulatory Affairs at American Airlines; Steve Morrissey, VP of Regulatory & Policy at United Airlines; and Robert Rivkin, SVP for Regulatory & International Affairs at Delta Air Lines.
The full submission is available here.