WASHINGTON—The U.S. government is not wavering from its open skies policy and will negotiate open skies deals with any friendly country that is interested, despite calls for the government to roll back liberalization in order to protect the U.S. airline industry, a senior State Dept. official said.
The U.S. government has no plans to change its policy, Thomas Engle, deputy assistant secretary of State for transportation affairs, said at the Airports Council International-North America international aviation issues seminar. Since the first open skies treaty was struck with the Netherlands in 1992, the U.S. has signed open skies agreements with 114 countries, including the EU. 
This has resulted in explosive growth of travel and tourism, up 68% since the first deal and responsible now for 2.8% of U.S. gross domestic product. In 1995, 19 million U.S. citizens traveled abroad, versus 29 million last year. “None of this would have happened without open skies,” Engle said. “It remains U.S. policy to pursue open skies.”
Organized labor and several legacy carriers on both sides of the Atlantic are pushing for the U.S. and the EU to limit some liberalizations offered by open skies, and rather opt for what the European Cockpit Association (ECA) and other groups call “Fair Skies.” This would allow governments to limit some traffic rights to carriers thought to benefit from unfair state subsidies, a proposal aimed squarely at the three big Persian Gulf carriers: Emirates, Etihad Airways and Qatar Airways.
The rise of these Middle Eastern airlines is among the “unintended consequences” of liberalization, the ECA said, a position echoed by the Air Line Pilots Association (ALPA) and several European and U.S. carriers. The Gulf carriers enjoy state subsidies, including having airport infrastructure built for them, that create “insurmountable competition” for U.S. carriers, Russell Bailey, ALPA senior attorney, said. 
Moreover, Gulf carriers—among others—benefit from lower-than-market financing for aircraft, both from Airbus and Boeing, thanks to export-credit agency financing from the Export-Import Bank of the U.S. and European agencies, labor and legacy airlines say. In fact, U.S. carriers have had to scale back some routes—including to India—due to this and other competitive advantages, Bailey said.
The cargo industry has been among the main beneficiaries of open skies, Cargo Airlines Association CEO Stephen Alterman added. “We absolutely need open skies,” he said. “We don’t want protectionism and we don’t want to pull back from open skies agreements.” Alterman warned that rolling back open skies would bring the cargo airline industry to its knees and harm U.S. trade and competitiveness.
Allowing governments to “unilaterally” limit traffic rights based on perceived unfair competition is an “absolutely horrible, dangerous and ridiculous idea,” said John Byerly, a former State Dept. official during whose tenure dozens of open skies agreements—including with the EU—were negotiated. Introducing “fair skies” provisions would undermine open skies and could allow other countries to retaliate by also limiting traffic rights. This would undo the last two decades’ gains, Byerly said.
Moreover, open skies deals are a necessary counterbalance to prevailing trends in the airline industry. With the consolidation of the U.S. industry into three major carriers—and the global industry into three major alliances—open skies deals allow for new entrants to challenge legacy carriers for market share. Consolidation has been good for the industry, Byerly said, but, “what is worrisome is when these carriers try to lobby governments to roll back access.”