Delta Air Lines chief executive Richard Anderson on Tuesday said he opposes renewing the US Export-Import Bank's charter unless there are changes to the way the bank finances the sale of wide-body aircraft.
"Without meaningful reform we are opposed to reauthorisation," he said.
Anderson, speaking at the Aero Club in Washington, also said there could be "a path" to reauthorisation if the bank takes steps to stop giving foreign airlines what he said was an unfair competitive advantage over US carriers.
The Delta CEO's comments come as the newly elected No. 2 Republican in the House of Representatives, Kevin McCarthy, put the future of the bank in doubt by saying he opposes renewing its charter when it expires at the end of September.
Ex-Im helped finance USD$37.4 billion worth of US exports in 2013. Scrapping the bank would be a blow to Boeing, General Electric and other US companies that rely on Ex-Im financing to make sales in export markets where commercial lending is scarce.
The bank is the US government export credit agency and is intended to provide loans and loan guarantees to support exports.
While Delta has called for reforms at the bank, firms that benefit from its export finance support have launched a lobbying push to reauthorise the institution.
The Delta chief is due to testify on Wednesday before the House Financial Services Committee, where Chairman Jeb Hensarling is also an Ex-Im sceptic.
Anderson is due to tell Hensarling's panel that competition among airlines for international passengers is skewed in favour of carriers that are backed by their governments, and that Ex-Im makes matters worse.
"That fight is heavily tilted in favour of foreign airlines receiving government subsidies, both from those airlines' home governments, and, amazingly, from our own," Anderson said in testimony prepared for delivery on Wednesday.
Ex-Im loan guarantees to Emirates are equivalent to USD$20 million per plane, effectively giving the carrier one free plane for every eight new planes it buys, he said.
Anderson said reauthorisation of the bank's charter could be a vehicle for reforms.
First, he urged banning financing of wide-body aircraft to airlines that are owned by foreign governments or that are capable of obtaining credit in private markets. Delta also wants the bank to disclose fully the details of its wide-body plane financing, including information on the routes on which those aircraft will be deployed.
Anderson also called on the bank to conduct analyses of the impact on the US economy and air travel industry of all wide-body aircraft transactions and to allow interested parties to comment on each transaction.
Source : news.airwise.com
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