American Airlines just backed down and reversed course in the nastiest battle in the aviation industry, signing a huge new agreement with Qatar

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American Airlines just backed down and reversed course in the nastiest battle in the aviation industry, signing a huge new agreement with Qatar

qatar airways ceo

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American Airlines announced Tuesday that it was launching a new strategic partnership with Qatar Airways, signaling an effective end to American's part in a protectionist trade feud that has roiled the US and Middle East airline industries for years.

American and Qatar said they had signed a renewed codeshare agreement, which would allow the airlines to sell itineraries operated by both airlines - for example, a flight from Phoenix to New York on American Airlines, connecting to a flight to Doha, Qatar on a Qatari plane.

In 2017, American ended an earlier codeshare with Qatar, as well as a similar agreement UAE-based Etihad.

That cancellation came amid accusations by the three major US airlines - American, Delta, and United - that the three major Middle East airlines, also known as the "ME3" - Qatar, Etihad, and Emirates - were receiving subsidies in violation of trade agreements.

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The conflict further escalated when the US airlines lobbied the Trump administration over Qatar Airways' minority ownership of now-defunct Air Italy, accusing it of anti-competitive practices. Qatar previously said it would consider withdrawing from the Oneworld airline alliance.

The new agreement appears to signal an end to the tensions - at least, between American Airlines and Qatar.

"The issues that led to the suspension of our partnership two years ago have been addressed, and we believe resuming our codeshare agreement will allow us to provide service to markets that our customers, team members and shareholders value, including new growth opportunities for American Airlines," American CEO Doug Parker said in a statement.

"We look forward to the renewed cooperation between our airlines and hope to build an even stronger relationship with Qatar Airways over time," he added.

It is not clear whether American won any concessions over the course of the conflict, nor what changed to alleviate the issues cited by Parker. American did not immediately return a request for comment.

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"We have moved on from past issues and look forward to working closely with American Airlines to build a world-leading partnership for all our customers," Qatar Airways Group CEO Akbar Al Baker said. "This agreement will harness our complementary strengths and resources."

American Airlines also said it would "explore" the possibility of operating its own flights to Doha, in addition to adding its code to Qatar flights.

The deal is subject to regulatory approval.

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