British Airways spreads its wings

Scott Jagow Oct 18, 2007


Scott Jagow: I told you yesterday that Delta and Air France are forming a partnership to get more routes between Europe and the U.S.
They’re clearly targeting British Airways, the dominant airline at London’s Heathrow airport.

Well, British Airways won’t take this lying down, I can assure you. BA might be looking at a deal with a different U.S. carrier — maybe even a merger.

Let’s bring in David Robertson with the Times of London. David, a merger with who?

David Robertson: Well, British Airways would like to get closer to American Airlines. They’ve tried on two occasions in the past to merge with AA, and have been blocked by regulators. One of the ideas that’s become apparent is that British Airways could try and create a super-carrier by taking out a smaller British carrier called BMI and also then merging with American Airlines.

Jagow: And how might that fly in Britain? Excuse the pun.

Robertson: It would be very controversial, because it would give British Airways an enormous stranglehold on Heathrow, which is Europe’s gateway, effectively. The likes of Virgin Atlantic are banned to fight that very hard.

Jagow: But overall, the Open Skies agreement seems like a good thing here for competition?

Robertson: Oh, yes. Aviation is one of the last heavily-regulated areas of business between Europe and the United States. Getting rid of those barriers will mean that airlines like Delta and Continental can come in. And if they have the sort of service provision that can sound up to the likes of BA and Virgin, they should do well.

Jagow: All right. David Robertson from the Times of London. Thanks for joining us.

Robertson: Thank you.

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