BA and American Airlines blind to dominance at Heathrow
Virgin Atlantic, one of the world’s leading long-haul
airlines, today highlighted the contradictions and
lack of consumer benefits in BA and American
Airline’s proposals to effectively merge. In its latest submission to the US Department of
Transportation, Virgin Atlantic said: “The
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constraints and conditions at Heathrow are unique to
this case which threatens significant consumer harm.
The Oneworld alliance is bigger and more dominant
than Star and Skyteam in the critically-important
US-Heathrow markets.”
Sir Richard Branson, President of Virgin Atlantic,
said:
“BA and AA are trying to manufacture some consumer
benefits by distracting the Department of
Transportation with so-called letters of support.
Isn’t it strange how the letters are virtually
identical to the letter template on the airlines’
own website? Any purported theoretical consumer
benefits are unquestionably overwhelmed by the very
real threat to competition from these proposals.
Rivals would be squeezed and prices would rise.”
“The BA/AA chameleon is on full display to the
regulators. For years, American Airlines objected to
anti-trust immunity applications by competing
alliances but has developed amnesia now that it is a
proponent of its own deal.”
In its submission, Virgin Atlantic sets out why
Heathrow is such a critical factor in BA/AA’s
proposals: “We object to this particular alliance
application due to the overwhelming market power that
Oneworld would have on US-Heathrow routes. Even BA
recognises this and has expressed an interest in
stockpiling slots. Comparisons across alliance hubs
in Paris and Frankfurt are meaningless.”
BA already has the largest share of peak-hour slots
at Heathrow, which enables the airline to achieve the
optimal schedule for flights into and out of
Heathrow. The submission quotes comments from the
slot co-ordinator at Heathrow, ACL, who themselves
state: ” At Heathrow, pool slot allocations will not
achieve any significant new entry” and “new entrant
airlines still need to be flexible about the timing
of slots and accept commercially suboptimal timings.”
Virgin Atlantic is also highlighting to the DoT some
strange cases of BA/AA double-speak. While other
carriers which don’t have anti-trust immunity have
successfully added nine new EU-US routes since 2006,
BA and AA are claiming that approving anti-trust
immunity will enable them to bring consumer benefits
by starting a new route between Madrid and Dallas
Fort Worth - a route which has in fact already
started, without ATI approval in place, last month.
The European Commission has opened a wide-ranging
investigation into BA and AA’s proposals and the
Department of Transportation is expected to make a
decision by the end of this year.
BA and AA have tried twice before, and failed, to get
anti-trust immunity.
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