WASHINGTON (Reuters) - Delta Air Lines Inc chief executive Richard Anderson said on Tuesday he opposes reauthorization of the U.S. Export-Import Bank unless there are changes to the way the bank finances the sale of widebody aircraft.
“Without meaningful reform we are opposed to reauthorization,” he said.
Anderson, speaking at the Aero Club in Washington, also said there could be “a path” to reauthorization if the bank takes steps to stop giving foreign airlines what he said was an unfair competitive advantage over U.S. carriers.
The Delta CEO’s comments come as the newly elected No. 2 Republican in the House of Representatives, Kevin McCarthy, threw 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 $37.4 billion worth of U.S. exports in 2013. Scrapping the bank would be a blow to Boeing BA.N, Caterpillar CAT.N, General Electric GE.N and other U.S. companies that rely on Ex-Im financing to make sales in export markets where commercial lending is scarce.
The bank is the U.S. 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 reauthorize 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 skeptic.
Anderson is due to tell Hensarling’s panel that competition among airlines for international passengers is skewed in favor of carriers that are backed by their home governments, and that Ex-Im makes matters worse.
“That fight is heavily tilted in favor 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, the airline based in Dubai, United Arab Emirates, are equivalent to $20 million per plane, effectively giving the carrier one free plane for every eight new planes it buys, he said.
Anderson said reauthorization of the bank’s charter could be a vehicle for reforms.
First, he urged banning financing of widebody aircraft, such as Boeing’s 777, 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 widebody 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 U.S. economy and air travel industry of all widebody aircraft transactions and to allow interested parties to comment on each transaction.
Reporting by Mark Felsenthal; Editing by Bill Trott
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