European Union transport ministers have unanimously backed an “open skies” aviation deal with the US which is aimed at liberalising transatlantic air travel.
The deal will ease restrictions on travel between Europe and the US, enabling EU-based airline to fly from any city within the EU to any city in the US, and vice versa.

According to the EU the deal, which will be implemented from October this year to March 2008, will bring fares down for consumers who would see up to $16bn (£8.1bn) in economic benefits as a result of the increased competition.

EU Transport Commissioner Jacques Barrot described the deal as one of “great political and economic importance”.

Virgin Atlantic have expressed concern, stating that although US airlines will gain free access to European airports, EU airlines would not be granted the same rights on US domestic routes.

Paul Charles, of Virgin Atlantic commented: “It doesn’t enable full liberalisation, it doesn’t open up US markets so that European and British carriers can operate from one city to another.”

British Airways also expressed disappointment about the deal, which will challenge its dominance at Heathrow airport, suggesting it will result in short term gains for the subsidised American aviation industry.

Willie Walsh, Chief Executive said: “With the EU having given away their most valuable negotiating asset - Heathrow - the UK government must stand by its pledge to withdraw traffic rights if the US does not deliver further liberalisation by 2010. Nothing short of an Open Aviation Area by 2010 will be acceptable and we want talks on the second stage to achieve this to start immediately.’

Walsh added that BA would not be impacted by the “open skies”. According to reports, BA has responded to the move by upgrading its economy class and plans to invest £28 million in a new inflight entertainment system.

The Business Travel Coalition (BTC) fully backed the agreement. They claim it will usher in a new era of lower costs for airlines, greater access to strategically important aviation markets and lower airfares for corporations that fund business travel activities.

Delta also welcomed the deal saying it will boost competition. Jerry Grinstein, Delta Air Lines Chief Executive Officer said: “Delta is pleased that the EU Transport Ministers have voted unanimously to approve creation of a fully deregulated trans-Atlantic marketplace that will benefit customers. We are looking forward to ratification of the deal at the end of April.

“We have supported a liberalised EU-U.S. agreement from its inception because it ultimately benefits the millions of trans-Atlantic customers who travel between Europe and the United States annually.

“A key focus for Delta has been to obtain meaningful access to London’s Heathrow International Airport. When ratified, today’s agreement will allow Delta and our SkyTeam partners the ability to participate more broadly in European markets, particularly London’s Heathrow airport. We applaud the EU Transport Ministers for seeing the benefits of this agreement for both EU countries and the United States, and we shall look forward to seeing this deal ratified next month.”

www.fco.gov.uk
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