US Approves Alliance between British Airways, American Airlines and Iberia
British Airways, American Airlines and Iberia have been given antitrust immunity from the US Department of Transportation (DoT) for a tie-up that will see the 3 carriers cooperate on operating schedules and airfare prices. This comes after the European Commission gave permission for the joint venture just last week.
The group has been trying to create a transatlantic joint business for 14 years now and have been turned down on approval 2 times before - once in 1997 and again in 2001. However, both the European Commission and DoT have seen now that the tie-up will give travelers many benefits, including new nonstop routes, cheaper airfare and improved schedules.
Many conditions have, however, been put in place to ensure that competition is preserved and consumers are protected. The secretary of aviation and international affairs for the department, Susan Kurland, says that the tie-up won’t eliminate or reduce competition. Neither will it be adverse to the interest of the public.
The chief executive of British Airways, Willie Walsh, said that the approval of this joint venture is great news for all of them and the Oneworld Alliance. They have waited 14 years to offer their customers the benefits of a transatlantic joint business, he continued, as well as for the playing field to be leveled between them and the SkyTeam and Star alliances. After Heathrow Airport was liberalized in 2008, the European-United States market became more competitive, he added, and they are happy authorities have recognized this.
However, the approval doesn’t come with British Airways and American Airlines getting a free ride. Both of the carriers will be made to surrender 8 landing and takeoff slots at Heathrow to their rivals.
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