British airlines not friendly to open skies

Stephen Beard Mar 5, 2007
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British airlines not friendly to open skies

Stephen Beard Mar 5, 2007
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MARK AUSTIN THOMAS: British Airways and Virgin Atlantic have attacked a deal to liberalize air travel between the U.S. and Europe. The companies say it would be bad for British aviation. From London, Stephen Beard reports.


STEPHEN BEARD: After years of talking, negotiators finally struck a deal on Friday night.

Under their draft agreement, European carriers would be able to fly to the U.S. from anywhere and not just from their home countries.

London’s Heathrow would be opened up, but that’s upset British Airways and Virgin. Hardly surprising says Andrew Bounds of the Financial Times. These are the only two European airlines that currently have transatlantic takeoff and landing slots at Heathrow.

ANDREW BOUNDS: Other airlines would be able to bid for those slots and this would then allow greater competition and one would think lower prices on transatlantic travel which of course would hit BA and Virgin profits.

BA shares fell almost 10% this morning, but there is wider opposition to the deal.

Other critics in the U.K. and Germany complain that the U.S. would still be able to prevent a foreign airline from taking control of an American carrier.

European member states will vote on the draft agreement later this month.

In London, this is Stephen Beard for Marketplace.

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