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US airlines enjoying record profits should pay their staff more, Qatar Airways CEO says

  • Akbar Al Baker says US airlines should pay more to their support staff
  • The Qatar Airways CEO says allegations of government subsidies are a smokescreen by U.S. carriers
  • Al Baker says the proposal to buy a stake in American Airlines was misunderstood

The chief executive of Qatar Airways has continued his war of words with rival U.S. carriers.

American Airlines, Delta Air Lines and United Airlines have jointly alleged for some time that Qatar Airways, along with fellow Gulf carriers Etihad and Emirates, receive unfair subsidies.

Akbar Al Baker told CNBC Tuesday that those allegations were a smokescreen.

Speaking at the CAPA aviation conference in Singapore, he said: "The allegations they are making against us are nothing more than just to protect their own companies from the unions who now want, legitimately, for their members to get better pay because of the record profits that they are making."

Members of the Transport Workers Union have been protesting outside the Fort Worth, Texas, headquarters of American Airlines. The union said it was attempting to negotiate a new contract deal and prevent the airline from outsourcing work to cheaper foreign workers.

Al Baker said U.S. carriers should better look after their staff and consider following the Qatar Airways model of pay.

"You know when my staff make the airline get profit, they get a share of the profit and the same should be done by these three American carriers who are making record profits in the history of aviation," Al Baker said.

To help improve margins, the U.S. airlines have been lobbying Washington to restrict the flight rights of their Middle Eastern rivals to the United States.

Against this backdrop, it was perhaps unsurprising that a Qatari bid to buy 10 percent of American Airlines was rejected. Al Baker said the intent of the deal was misunderstood.

"From day one, Doug Parker (American Airlines CEO) didn't want us. He put a lot of pressure on the administration to not allow us to take a stake. You know we are there as a strategic investor. We are not there to influence him," Al Baker said.

The Qatar Airways CEO added that he personally told Parker that the investment could proceed while the rift over alleged subsidies continued.

Following the collapse of the American Airlines proposal, Qatar Airways has now agreed to buy a near 10 percent stake in the Hong Kong airline Cathay Pacific for $661 million.

The move is viewed as a strategic toe-hold in the growing Chinese market.

Qatar Airways already owns 20 percent of International Consolidated Airlines Group, the parent of British Airways, as well as 10 percent of South America's LATAM Airlines Group and 49 percent of Italy's Meridiana.

In response, American Airlines said the average annual pay of its staff had increased by 43 percent since the merger with US Airways in 2013.

CNBC also contacted Delta Air Lines and United Airlines for this article but had not received a response at the time of publication.