Lufthansa has called for European regulators to block a tentative plan for Abu Dhabi’s state-owned Etihad Airways to invest in Italy’s Alitalia, saying it would amount to unfair competition.

Germany’s largest airline has fiercely lobbied against the fast expansion in Europe by state-owned Gulf airlines such as Etihad, Emirates, and Qatar Airways, and has said in the past they benefit from unfair state aid.

Lufthansa said Europe would do better to keep its airline industry mostly privatized, Reuters reported.

“We reject recurrent subsidies and the partial renationalization of European airlines, whether by European states or by states or state-owned companies from outside the European Union,” Lufthansa said in a statement quoted by Reuters.

Gulf airlines have faced repeated claims that they get unfair government subsidies, including accusations that they receive cheap or free fuel.

Etihad’s Chief Executive James Hogan has said previously that the airline gets “no state-funded handouts” and “no help with oil subsidies or deeply discounted landing charges at our home airport.”

Dubai’s Emirates also fiercely denies receiving subsidies from the government. “Our longstanding position is that Emirates is opposed to state aid and we, in fact, campaign against airline subsidies,” it says on its website.

Etihad said on Sunday it was in the final stages of a process that could see it invest in the ailing carrier Alitalia. It already has stakes in airlines including airberlin, Aer Lingus and Virgin Australia.

Italian Transport Minister Maurizio Lupi brushed off Lufthansa’s criticism.

“Lufthansa’s worries about a deal with Etihad just confirm that Alitalia is on the right track. State aid? Flouting of competition rules? It rather seems that Lufthansa is the one that is afraid of competition,” Lupi said in a statement quoted by Reuters.

 

Source: Al Arabiya; Reuters