Concorde001
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Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 1:42 am

It looks like Britain is set to agree to EU-US Open Skies, but on the condition that the EU supports the following British amendments:

  • Implementation at LHR to be delayed until March 2008 so BA can move into T5
  • If US objections to EU ownership of American carriers are not lifted by 2010, the EU will automatically withdraw from and therefore terminate Open Skies, leading to a new round of negotiations.


EU ministers meet tomorrow to discuss EU-US Open Skies...let's see what happens!

Sources:
Daily Mail Group
Reuters UK

[Edited 2007-03-21 18:49:18]
 
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N328KF
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 1:45 am

Quoting Concorde001 (Thread starter):
Implementation at LHR to be delayed until March 2008 so BA can move into T5

This seems reasonable.

Quoting Concorde001 (Thread starter):
# If US objections to EU ownership of American carriers is not lifted by 2010, the EU will automatically withdraw from and therefore terminate Open Skies, leading to a new round of negotiations.

Does this come with reciprocity?
When they call the roll in the Senate, the Senators do not know whether to answer 'Present' or 'Not guilty.' -Theodore Roosevelt
 
Virgin747LGW
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 1:48 am

Quoting Concorde001 (Thread starter):
If US objections to EU ownership of American carriers is not lifted by 2010, the EU will automatically withdraw from and therefore terminate Open Skies, leading to a new round of negotiations.

I never understood why the US is so against this, i mean the UK let a company from a different country take over its major airports let alone its airlines! Obviously there should be some security from companies located in countries that the US is suspiscious of, but c'mon this is Virgin-based in the UK (americas closest ally) we are talking about! its ridiculous
 
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 1:58 am

Quoting Virgin747LGW (Reply 2):
I never understood why the US is so against this, i mean the UK let a company from a different country take over its major airports let alone its airlines!

Interesting that you should cite that example. BAA Plc. owns and/or operates several U.S. airports, including PIT and IND. BAA is now owned by a Spanish company and the U.S. Government did not object.

Quoting Virgin747LGW (Reply 2):
Obviously there should be some security from companies located in countries that the US is suspiscious of, but c'mon this is Virgin-based in the UK (americas closest ally) we are talking about! its ridiculous

This has nothing to do with xenophobia or security concerns and everything to do with market protectionism.
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 2:06 am

[

Quoting N328KF (Reply 3):
This has nothing to do with xenophobia or security concerns and everything to do with market protectionism.

Why do US airlines need protecting? i think they re big and strong enough to do it themselves, just look at southwest i dont think anyone can stop them
 
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 2:09 am

Quoting Virgin747LGW (Reply 4):

Why do US airlines need protecting? i think they re big and strong enough to do it themselves, just look at southwest i dont think anyone can stop them

I'm not defending the practice. I think it would hasten the inevitable consolidation that is needed in North America. But some of the weaker players (and by this, I don't mean "smaller") might die off.
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 2:12 am

Quoting N328KF (Reply 5):
I'm not defending the practice. I think it would hasten the inevitable consolidation that is needed in North America. But some of the weaker players (and by this, I don't mean "smaller") might die off

so you agree that american carriers should be able to be owned by EU companies?
 
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 2:16 am

Quoting Virgin747LGW (Reply 6):
so you agree that american carriers should be able to be owned by EU companies?

Only if the converse is true, which currently is not.
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Virgin747LGW
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 2:18 am

Quoting N328KF (Reply 7):
Only if the converse is true, which currently is not.

sorry i didnt know rhat, i think it should be alllowed both ways as this will stop airlines hiding behind their governments and force them to compete, which can only be good for the passenger
 
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 2:52 am

Quoting Concorde001 (Thread starter):
If US objections to EU ownership of American carriers are not lifted by 2010, the EU will automatically withdraw from and therefore terminate Open Skies, leading to a new round of negotiations.

Does anyone else see this as extremely problematic, for the massive investments sure to come by American carriers in Heathrow slots, only to have a possible cloud of uncertainty hang over them between 2008 and 2010?
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Humberside
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 2:53 am

Quoting Concorde001 (Thread starter):
Implementation at LHR to be delayed until March 2008 so BA can move into T5

Message to DfT - you no longer own BA and they are not the only UK airline so stop protecting them
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 3:06 am

Quoting Virgin747LGW (Reply 2):
I never understood why the US is so against this, i mean the UK let a company from a different country take over its major airports let alone its airlines!

Are you comparing the UK market to the entire US market?
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ikramerica
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 3:06 am

This is not an agreement. They are trying to force their certain viewpoint that was NOT agreed to by saying 2010 is the deadline to "do it anyway" or it doesn't count.

The USA is already wary of this agreement under our new leadership, and having the UK take this stand could kill it. Of course, it's brilliant, because they can claim it was the USA who is killing it, despite the UK changing the agreement! The UK can talk to the EU all they want, but the USA and the EU ALREADY NEGOTIATED and the UK lost on this point. The UK, in essence (and actually really BA, since VS is for the agreement), is throwing out those negotiations and setting it's own outcome. What exactly was the point of the negotiations then?

Quoting Virgin747LGW (Reply 2):
I never understood why the US is so against this, i mean the UK let a company from a different country take over its major airports let alone its airlines!

Just as I state over and over when this comes up. The UK has made the huge mistake of selling their entire infrastructure to other countries, and their answer is to force other countries to also make that mistake because it's too late for them. Why should we be forced to make that same mistake? Fairness? Equivalent stupidity?

Also funny how when dealing with QF, that same argument doesn't get made by many on this forum. When dealing with QF, it's all about losing identity and selling out and all that. But the double standard re: America is how dare we protect our internal markets from foreign ownership? It's just protectionism. But the SAME result would come once this passed and foreign airlines bought out our airlines. We'd lose many jobs here and some of our airlines would be gutted in favor of LCC spinoffs and foreign owner/carriers taking over key routes.

I'm not sure what the answer is, as I see major issues with what the UK has allowed to happen to their country, but I also see room for more foreign ownership in airlines in the US as long as control isn't given over (similar to how the ports are operated here).

But I don't need the UK or it's citizens trying to combine open skies with a completely different issue. Somehow the USA has been able to negotiate open sky agreements with other countries without the ownership provisions, as have many other nations around the world with many other nations. Are all you UK citizens claiming all those hundreds of open skies deals around the world aren't REAL open skies if they don't open up ownership?

Or are you just applying a different standard to the USA...
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commavia
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 3:18 am

The U.K. government, BA's comment's notwithstanding, is being prudent and realistic. The know this is a done-deal and they know they can't realistically hold up something that the entire rest of Europe wants without facing some major political consequences (not that being Europe's odd man out has ever really bothered such a Eurosceptic culture). Nonetheless, if Britain is basically offering the terms as described in the Mail, then yes, this basically amounts to complete surrender on the part of the U.K. in terms of holding out for something better with the U.S. Since we all know and have known for a long time that the offer -- from the U.S. end -- was never going to get better, it's smart that the U.K. is finally just picking up the pieces and moving on. BA will, no doubt, do the same relatively soon.

I also find this excerpt from the article telling:

'The deal on the table falls short', he said. 'If a US carrier can operate from New York to London and on to Frankfurt, but an EU carrier can't operate from London to New York and on to, say San Francisco, then there remains work to be done.' But he also hinted that Britain may be willing to compromise with a 'phased' approach'.

If BA or the U.K. honestly thinks that the U.S. is ever going to agree to complete Open Skies with cabotage, they are completely delusional. Once the U.S. and E.U. strike a deal that opens up the markets and, most importantly for the U.S., opens up Heathrow to other U.S. carriers, the U.S. is basically not going to give the E.U. the time of day down the road when the Europeans inevitably do start making noise about cabotage again. If protectionists in Congress weren't even content to let Europeans own non-controlling, minority interests in U.S. carriers, than I see simply no way whatsoever that the U.S. would ever allow a foreign flag carrier to fly domestic U.S. passengers.

I am also interested, as I said on another thread on this topic here on A.net a few days ago, about the true impact this will have on BA. I read that Walsh, smartly and honestly, said that in the short-run, the financial hit from this liberalization would likely be "managable," and might possibly even turn out to be a positive in the long-run, and I think he is right. While BA is no doubt going to see its ultra-premium yields on LHR-U.S. sectors eroded by more competition, I think this could also lead to BA finally being able to compete on a level playing field with continental carriers that don't suffer from a dual hub (a la LHR/LGW) problem across the Atlantic. Also, the AA-BA Antitrust Immunity that would likely follow this deal within a matter of months would no doubt bring tens (if not millions) of dollars to both airlines through joint scheduling and pricing, and better connectivity.

Should be very interesting to watch this whole thing play out.

Quoting N328KF (Reply 1):
This seems reasonable.

I agree completely. Delaying the deal by a few months seems like a very reasonable compromise, and something I have no doubt the U.S. will agree to, especially because the U.S. knows full well that even if the deal went through a few months earlier, as planned, Continental and Delta and the other U.S. carriers would have basically nowhere to operate at Heathrow's already-overstretched terminals. Once BA moves over to T5 in 2008, and opens up almost half of Heathrow's gate capacity, there will be ample terminal space for Continental, Delta or any other airline that wants to come join the fun.

Quoting Virgin747LGW (Reply 4):
Why do US airlines need protecting?

I don't know if it is just protecting, so much as it is also about the equity of the trade. While I think that many (myself included) may ideological and theoretically subscribe to the concept of a completely free and open U.S.-E.U. air market with no restrictions or barriers among carriers, many also recognize that, at least from the American side, it would be far from an equal trade. Giving E.U. carriers the right to fly in the U.S. is giving them a piece of by-far the largest and most extensive domestic air travel market on earth, and also one of the most open and unrestricted. If BA or Lufthansa wanted to fly from Kansas City to Houston with 10 747s per day, there would be nothing stopping them beyond being able to find suitable gates at those airports. The same would definitely not be true, however, of, say, AA or Northwest starting an hourly shuttle between London and Paris. Every major airport of any consequence in Europe, serving any major city on the continent, is heavily slot-restricted and capacity-constrained. Whereas cabotage in the U.S. would give E.U. carriers basically free and clear access to basically every U.S. airport save a few (O'Hare, LaGuardia, Reagan, Orange County, etc.), cabotage in Europe would give U.S. carriers access to basically nothing because slots and facilities at just about every major airport in the region are all already taken.

Quoting AeroWesty (Reply 9):
Does anyone else see this as extremely problematic, for the massive investments sure to come by American carriers in Heathrow slots, only to have a possible cloud of uncertainty hang over them between 2008 and 2010?

For precisely the reason you state, I doubt there will be much certainty. Populist U.S. lawmakers are not going to be thrilled about allowing foreigners to own larger (albeit still non-controlling minority) stakes in U.S. carriers, but I think they will be even less thrilled about screwing over airlines like Continental and Delta, which are U.S. companies that employ thousands and pump tens of billions into the economy, by jeapordizing the millions in investment that those companies will, as you right say, no doubt sink into Heathrow slots within minutes of this deal going into effect.
 
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 3:29 am

Quoting Commavia (Reply 13):
I think they will be even less thrilled about screwing over airlines like Continental and Delta, which are U.S. companies that employ thousands and pump tens of billions into the economy, by jeapordizing the millions in investment that those companies will, as you right say, no doubt sink into Heathrow slots within minutes of this deal going into effect.

Hopefully "our side" will recall it was the British who tore up Bermuda I in 1976, and reject this unreasonable condition (I think giving BA until '08 to move to T5 is fine). Certainty must be an essential part of the new agreement, and I can only wonder how the ability to revoke the new Open Skies treaty could be read as anything other than bowing to "special interests", which would devalue the spirit of the agreement from the get-go.
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ikramerica
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 3:30 am

I just want to add, the USA and EU negotiated in good faith. For the EU to entertain or adopt the 2010 deadline is not in good faith. Why should we in the USA feel as if any future negotiations would be in good faith?

If the UK didn't want to be part of the EU, they shouldn't have joined...

Something to think about.

As for the 2008 provision, that is a bit different. I can see an April 1 2008 compromise being workable, but that would include all carriers including VS CDG-JFK, for example. That allows all the carriers to prepare their home markets for "attack" from other carriers.

But to only provide BA with that protection at LHR while not affording LH protection at FRA or AA protection at MIA, for example, it's also a request that's not in good faith.

Quoting Commavia (Reply 13):
'The deal on the table falls short', he said. 'If a US carrier can operate from New York to London and on to Frankfurt, but an EU carrier can't operate from London to New York and on to, say San Francisco, then there remains work to be done.' But he also hinted that Britain may be willing to compromise with a 'phased' approach'.

Again, this gets to the fundamental mistake the UK is making. They are equating LHR-FRA with JFK-SFO. A 5th freedom flight with cabotage. And they are doing so because the EU is trying to equate itself with the USA. We are one nation, the EU are not. If they want to become one nation, bully for them. Do it.

Why can't the USA come back and say: if BA has the right to fly JFK-MEX (something I believe they can get should they want it under current agreements), why can't we fly LHR-MAN? Is that what the UK wants? Really? I doubt it. But we can just say: NAFTA is sort of like the EU constitution, so we are going to redefine North America into one nation, and now any flights within North America are cabotage. That's what the UK is saying, after all...
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vega
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 3:45 am

Quoting Concorde001 (Thread starter):
If US objections to EU ownership of American carriers are not lifted by 2010, the EU will automatically withdraw from and therefore terminate Open Skies, leading to a new round of negotiations.

Why would the U.S. agree to this and put themselves in a position of negotiating a whole new treaty AFTER 4 or 5 U.S. carriers had already taken advantage of the previous agreement and started extensive new services to Europe? I can imagine the reaction of those carriers and their political allies if told they had to discontinue operations because Open Skies was terminated in 2010. If the U.S. accepted this condition, I'd bet very few, if any, U.S. carriers would take advantage of a 2 or so year treaty and commit significant new resources to Europe . The same situation would probably curtail expansion plans for European carriers to the U.S.. The E.U. and U.S. should call the U.K's bluff, sign the agreement and leave BA and the U.K. out of it. FRA, etal. could then become the "new" LHR for worldwide connectivity.  sarcastic 
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commavia
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 3:52 am

Quoting Ikramerica (Reply 15):
Again, this gets to the fundamental mistake the UK is making.

And that underlies the even larger fundamental issue that the U.K. and the rest of the E.U. is eventually going to have to actually sort out. They got lucky by finally getting the Americans to agree to anything on this matter, but the issues of national sovereignty and the true nature of the European Union extend far beyond the commercial aviation sector, and are no doubt going to persist until a definitive decision is made: is the European Union a country or a confederation?

As you, Ikramerica, rightly say, if it is just a confederation (as the U.S. and just about everyone recognizes it) that the comical British argument comparing LHR-FRA with JFK-SFO is, as you say, a "fundamental mistake." In the eyes of international law, the United States is a sovereign nation, and thus a flight between two domestic points within that sovereign nation by a carrier wearing a foreign flag constitutes, under the articles of the International Civil Aviation Organization's Freedoms of the Air, Eighth and/or Ninth Freedom cabotage. On the other hand, if a U.S. carrier carrying local passengers between a point in the United Kingdom, a sovereign nation, and Germany, another sovereign nation, then this is a Beyond Fifth Freedom right, and not an Eighth and/or Ninth Freedom cabotage right.

Quoting Ikramerica (Reply 15):
Why can't the USA come back and say: if BA has the right to fly JFK-MEX (something I believe they can get should they want it under current agreements), why can't we fly LHR-MAN? Is that what the UK wants? Really? I doubt it. But we can just say: NAFTA is sort of like the EU constitution, so we are going to redefine North America into one nation, and now any flights within North America are cabotage. That's what the UK is saying, after all...

I like it.  Smile
 
AeroWesty
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 3:53 am

Quoting Vega (Reply 16):
The E.U. and U.S. should call the U.K's bluff, sign the agreement and leave BA and the U.K. out of it. FRA, etal. could then become the "new" LHR for worldwide connectivity.

I've stated a few times in the past that if the U.K. continues to protect LHR, then CDG, AMS and FRA will continue to increase in influence, marginalizing LHR in the long run. This is the U.K.'s game to lose. AMS exploded in traffic after the U.S.-Netherlands Open Skies agreement, and while many will most likely take me to task for this, I personally believe that Heathrow isn't all that important to the bulk of O&D passengers between the U.S. and the U.K. Certainly there is a market for Heathrow, and Gatwick is limited by its single runway, but if you're going to London, there isn't much wrong with flying to Gatwick, in my personal opinion, and I quite like the airport.
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Leezyjet
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 4:06 am

Quoting Humberside (Reply 10):
Message to DfT - you no longer own BA and they are not the only UK airline so stop protecting them

I don't think it is so much protecting them, more like there is already going to be a major shift in the logistics at LHR going on in 2008 with T5 opening, T2 closing and the subsequent re-shuffle of all the airlines between the terminals. Adding more carriers to this would just be more of a nightmare than it already will be.

It would also allow the Airport Authority to see which terminal has the required amount of gate space needed at the right times of day for the new entrants to LHR.

2008 isn't all that far away. It is round about 12 months now until T5 opens.

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DiscoverCSG
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 4:11 am

Quoting Virgin747LGW (Reply 4):
Why do US airlines need protecting? i think they re big and strong enough to do it themselves

Well, how many of the big 6 have been in bankruptcy this decade? Frankly, many of our airlines are not in a position to compete with the major European and Asian carriers, either financially or in terms of their product offering. Then, some of our carriers (CO mainly, and to a lesser extent AA and US maybe) might do okay with that sort of competition.

The protection of our carriers is bad for the consumer - we don't get as many choices, and our home carriers aren't exposed to competition from outside carriers with (in many cases) stronger products.

On the other hand, I can see why no politician wants his name on the failure of several US carriers.

It will be interesting to see who wins.
 
airfrnt
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 4:17 am

Quoting Concorde001 (Thread starter):

* Implementation at LHR to be delayed until March 2008 so BA can move into T5
* If US objections to EU ownership of American carriers are not lifted by 2010, the EU will automatically withdraw from and therefore terminate Open Skies, leading to a new round of negotiations.




Quoting Concorde001 (Thread starter):

# Implementation at LHR to be delayed until March 2008 so BA can move into T5
# If US objections to EU ownership of American carriers are not lifted by 2010, the EU will automatically withdraw from and therefore terminate Open Skies, leading to a new round of negotiations.

In other words, they don't agree. They just want their way, and realize that they can't get it now, so they are going to try again in three years. The US side might agree on the Heathrow restrictions (I doubt it), but they will not agree to end this in three years. It's a poison pill.
 
ANother
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 4:26 am

Wow. Play this back 62 years to the Chicago convention. US representatives wanted NO economic regulation of the industry. No ownership and control rules. No traffic right restrictions. European side, with weak (or no) airlines following WWII wanted to protect their industry. US side didn't get what they wanted - settled for Bermuda I the following year and the rest is history.

Fast Forward to 2007 - all but one US airlines in, or recently in, bankruptcy. 1500 job losses in the last 12 months. etc. etc. etc.

I've said it before, and I'll repeat it again. These archaic rules are bad for our industry. They need to be changed. They need to be changed soon.
 
bmiexpat
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 4:28 am

Quoting Ikramerica (Reply 15):
NAFTA is sort of like the EU constitution, so we are going to redefine North America into one nation, and now any flights within North America are cabotage. That's what the UK is saying, after all...

Hardly! The EU is a law making body that has authority over the individual nation states within it, with a supreme court that over rules the courts of the individual nation states. You cannot possibly compare what is a free trade area (NAFTA) and the EU. The day that US, Canadian and Mexican citizens participate in elections to a NAFTA parliament, and a NAFTA supreme court can overrule the US supreme court, and NAFTA takes over responsibilty for international trade and commerce aggreements on behalf of all it's members, is the day you can compare NAFTA to to the EU.
 
atmx2000
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 4:28 am

Quoting AeroWesty (Reply 9):
Does anyone else see this as extremely problematic, for the massive investments sure to come by American carriers in Heathrow slots, only to have a possible cloud of uncertainty hang over them between 2008 and 2010?



Quoting Commavia (Reply 13):
If BA or the U.K. honestly thinks that the U.S. is ever going to agree to complete Open Skies with cabotage, they are completely delusional. Once the U.S. and E.U. strike a deal that opens up the markets and, most importantly for the U.S., opens up Heathrow to other U.S. carriers, the U.S. is basically not going to give the E.U. the time of day down the road when the Europeans inevitably do start making noise about cabotage again. If protectionists in Congress weren't even content to let Europeans own non-controlling, minority interests in U.S. carriers, than I see simply no way whatsoever that the U.S. would ever allow a foreign flag carrier to fly domestic U.S. passengers.

The reality is that this won't happen because the US will take away 6th freedom rights and limit EU airlines access to US airports.

Quoting Virgin747LGW (Reply 2):
I never understood why the US is so against this, i mean the UK let a company from a different country take over its major airports let alone its airlines! Obviously there should be some security from companies located in countries that the US is suspiscious of, but c'mon this is Virgin-based in the UK (americas closest ally) we are talking about! its ridiculous

I think there economic reasons as well. I would say there are far more revenue opportunities in the US air market because the US is a very large country geographically and depends more on air service for travel. Most US airports are in general not very constrained in terms of runways and facilities making it easier for an airline to start up and become big. 5th freedom routes within the EU would be a lot harder to take advantage of. Giving domestic rights to EU carriers would be an unequal trade.

Quoting Ikramerica (Reply 15):
Again, this gets to the fundamental mistake the UK is making. They are equating LHR-FRA with JFK-SFO. A 5th freedom flight with cabotage. And they are doing so because the EU is trying to equate itself with the USA. We are one nation, the EU are not. If they want to become one nation, bully for them. Do it.

There are some practical differences too. The LHR-FRA segment and JFK-SFO segment are so different distance wise. The equipment used on LHR-JFK will be more suitable for JFK-SFO than LHR-FRA. And then you need double the slots at LHR for that EU flight.

Quoting Ikramerica (Reply 15):
Why can't the USA come back and say: if BA has the right to fly JFK-MEX (something I believe they can get should they want it under current agreements), why can't we fly LHR-MAN? Is that what the UK wants? Really? I doubt it. But we can just say: NAFTA is sort of like the EU constitution, so we are going to redefine North America into one nation, and now any flights within North America are cabotage. That's what the UK is saying, after all...



Quoting Commavia (Reply 17):
They got lucky by finally getting the Americans to agree to anything on this matter, but the issues of national sovereignty and the true nature of the European Union extend far beyond the commercial aviation sector, and are no doubt going to persist until a definitive decision is made: is the European Union a country or a confederation?

Let's even forget the notion of what the status of the EU is in general and stick to aviation. European countries are often only willing to negotiate under the EU banner when negotiating with the US. EU countries have negotiated or altered bilaterals with other countries on an individual basis despite the ECJ ruling. I believe both the UK and Germany have new agreements with India for example. And EU countries retain their individual representation in the ICAO. And EU majors seem disinclined to compete with each other at each others hubs. If EU countries gave up individual ICAO representation and stopped negotiating individual bilaterals with everyone else the US should offer to give up 5th freedom routes within the EU.

Quoting AeroWesty (Reply 18):
I've stated a few times in the past that if the U.K. continues to protect LHR, then CDG, AMS and FRA will continue to increase in influence, marginalizing LHR in the long run. This is the U.K.'s game to lose.



Quoting Vega (Reply 16):
FRA, etal. could then become the "new" LHR for worldwide connectivity.

A great deal of US-UK traffic is O&D.

Quoting AeroWesty (Reply 18):
AMS exploded in traffic after the U.S.-Netherlands Open Skies agreement, and while many will most likely take me to task for this, I personally believe that Heathrow isn't all that important to the bulk of O&D passengers between the U.S. and the U.K.

It may not be important to the bulk of passengers, but it is certainly more important to business travelers and those who buy premium seats. US airlines do know there is a yield difference between the LHR and LGW.
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express1
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 4:33 am

Correct me if i'm wrong, if this Open skies deal does go ahead and everyone is happy, what next?, for a start, LHR,LGW are not big enough to cope with every International carrier from the US and Europe not yet anyway, there's just no more room to expand LHR because there ain't no spare land to expand on, unless BAA bulldoze through around 1,000 houses or more that are close to the airport,but that will only be adding fuel to the fire, and i don't think BAA want over 1,000 residents sleeping at their terminals either. This Open Skies deal sounds as if its kicking into first gear quicker than the UK airport expantion ?. I think the snake will soon catchup with its tail, and all this will come to another dead end and then the thinking caps will go back on.

this is my view anyway.

regrds
dave
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AeroWesty
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 4:36 am

Quoting Atmx2000 (Reply 24):
It may not be important to the bulk of passengers, but it is certainly more important to business travelers and those who buy premium seats. US airlines do know there is a yield difference between the LHR and LGW.

Yes, that's been proven time and again, and I'm not questioning it, hence why I believe there will be a mad rush for LHR slots at the first possible moment. I just persoally find LGW more user-friendly, and see nothing wrong with it as a gateway to the U.K. for U.K.-bound passengers, and highly suspect there are plenty who feel similarly.
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bmiexpat
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 4:37 am

Quoting Atmx2000 (Reply 24):
If EU countries gave up individual ICAO representation and stopped negotiating individual bilaterals with everyone else the US should offer to give up 5th freedom routes within the EU.

The European Court decreed that individual bi laterals are illegal, and that in future all new agreements would be decided upon on an EU basis. However, for the EU to get around to renegotiating all bilateral agreements with every country in the world will take a very, very, very long time. Therefore in the meantime they will not stop individual EU nations from negotiating new bilaterals on an idivdual basis as long as they are open skies agreements, therefore making the eventual EU wide negotiations easier.

Nobody is asking for US carriers to give up the right to 5th freedom routes within the EU..... like any of them will actually use them anyway!
 
ANother
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 4:45 am

Quoting Express1 (Reply 25):
this is my view anyway.

Dave, such wisdom in a short post.

The illusion of the 'crown jewels' of London's Heathrow airport is soon to be dashed. One, and likely the only, reason why LHR - US routes are so profitable is because they are limited.

The crown jewels are about to become the goose that laid the golden egg. Open LHR-US to all and sundry? Well a feeding frenzy will soon occur over slots. Ridiculous offers will be made and accepted - but to what end? Adding capacity in such a mature market will not likely grow the market beyond a few percentage points.

It's going to be interesting watching, I hope it's not too fatal.
 
vega
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 4:45 am

Quoting Atmx2000 (Reply 24):
Quoting Vega (Reply 16):
FRA, etal. could then become the "new" LHR for worldwide connectivity.

A great deal of US-UK traffic is O&D.
Quoting AeroWesty (Reply 18):
AMS exploded in traffic after the U.S.-Netherlands Open Skies agreement, and while many will most likely take me to task for this, I personally believe that Heathrow isn't all that important to the bulk of O&D passengers between the U.S. and the U.K.

It may not be important to the bulk of passengers, but it is certainly more important to business travelers and those who buy premium seats. US airlines do know there is a yield difference between the LHR and LGW.


"A great deal" is a subjective statement and IMO an unsupportable negotiating point. Current flights to LHR by U.S. carriers would likely not be disrupted by signing Open Skies as is and bypassing the U.K./BA. It is more likely U.S. carriers would fore-go new LHR routes for Open Skies today, particularly since acquiring Slots is far from a certainty.
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Concorde001
Topic Author
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 4:49 am

Reuters seems to be confirming now that the British Government will only support EU-US Open Skies if the two conditions are met by the EU.

"If the rest of Europe doesn't agree with delay and automatic termination, the UK will vote against 'open skies,"' the source said.

To be honest, I think the British Government may get its way. After all, didn't the EU Transport Commissioner urge Britain to accept the current deal with the promise that ownership restrcitions would be dealt with later?

Source: Reuters

Quoting Ikramerica (Reply 12):
The UK has made the huge mistake of selling their entire infrastructure to other countries, and their answer is to force other countries to also make that mistake because it's too late for them.
Who said it was a mistake? There is definitely an issue with regards to reciprocity and a level playing field with takeovers of some British firms, but Britain is an incredibly open economy. And contrary to what some are saying here, Britain is not a protectionist country.

For goodness sake, this is the country which:

  • Opened up its whole financial services industry to foreigners and allowed them to dominate The City. London is growing in huge importance every year and it is being predicted that it will takeover New York in importance if current growth projections materialise.
  • Has said that is has no objections of Nasdaq taking over the London Stock Exchange as long as British regulation has primacy.
  • Has had its steel company taken over by a successful Indian company which is more likely to safeguard British jobs.
  • Has it's car industry owned mainly by foreigners and consequently has some of the most productive car manufacturing plants in the world, for example Toyota's plants which are now exporting cars back to Japan.
  • Has one of its leading banks taken over by a Spanish company.
  • Had no objections to Dubai World purchasing P&O and thus gaining control over its ports. (There is no issue of security as US congressman would have us believe).
  • Refused to bail out MG Rover (Car company) and let it collapse because the role of the state is not to prop up unsuccessful businesses.
  • Britain's reputation for openness has made it the leading country in Europe for FDI.
  • Britain has experienced strong economic growth and is in much better shape than most other G7 countries.


I may not like some of the above developments (because of issues regarding reciprocity, for example the US would never allow the LSE to acquire Nasdaq), but they prove Britain is a very open country and economy. And to be perfectly honest, the British Government is not trying to protect BA - this is the same government that refused to provide money to BA and other UK airlines to pay for security and restructuring when BA was nearing bankruptcy in 2001! The British Government is simply pursuing its national interest, just like the US does all the time (and rightly so).

[Edited 2007-03-21 22:01:23]

[Edited 2007-03-21 22:04:17]
 
commavia
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 5:03 am

Quoting Express1 (Reply 25):
for a start, LHR,LGW are not big enough to cope with every International carrier from the US and Europe not yet anyway, there's just no more room to expand LHR because there ain't no spare land to expand on, unless BAA bulldoze through around 1,000 houses or more that are close to the airport,but that will only be adding fuel to the fire, and i don't think BAA want over 1,000 residents sleeping at their terminals either.

That's an entirely seperate issue. The U.K. needs to stop this ridiculous crap about pandering to a tiny minority of people who are holding up the viability and long-term competitiveness of one of Britain's most important economic interests.

Quoting AeroWesty (Reply 26):
I just persoally find LGW more user-friendly, and see nothing wrong with it as a gateway to the U.K. for U.K.-bound passengers, and highly suspect there are plenty who feel similarly.

I agree that Gatwick is, for the ordinary traveler, a far superior experience to the unmidigated chaos that is Heathrow. That being said, Heathrow's prime close-in location, easy tube access, and virtually unlimited connections to everywhere, make it the airport of choice for the high-yield business travelers that airlines make decisions based on.

Quoting Bmiexpat (Reply 27):
However, for the EU to get around to renegotiating all bilateral agreements with every country in the world will take a very, very, very long time. Therefore in the meantime they will not stop individual EU nations from negotiating new bilaterals on an idivdual basis as long as they are open skies agreements, therefore making the eventual EU wide negotiations easier.

So the law applies and will be enforced, but not really. Once again, the comical mess that is the European Union. Either the rule of European law is paramount, or it's nothing. In the United States, when the Supreme Court makes a ruling and determines a law or action to be unconstitutional or illegal, the effect is immediate. That law or action is immediately rendered illegal and punishable by prosecution. In the E.U., by constrast, the ECJ makes a ruling and yet, somehow, the quasi sovereign nation/quasi member states can, maybe, sort of, kind of, by proxy, practicly, ignore it. Ridiculous. Make a decision: either Europe is a continent, or it's a country. It can't go on being both forever.

Quoting ANother (Reply 28):
The crown jewels are about to become the goose that laid the golden egg. Open LHR-US to all and sundry?

Even with this deal, there isn't going to be a mountain of new flights into Heathrow. If every U.S. carrier at Gatwick today moved every single one of their London flights over to Heathrow, it would still not equal the number of flights AA and United already have each day at Heathrow, to say nothing of BA and Virgin. All and all, in total, this new liberalization will maybe me a total of 20-25 new daily flights from Heathrow because, as we all know, the right to fly to Heathrow is all fine and good but without the right to land the plane (i.e., slots) those rights are pretty much worthless. And Continental, Delta, etc. are going to have to pay top-dollar for peak Heathrow slots, and they certainly aren't going to be able to get an unlimited supply.
 
kaitak
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 5:03 am

Quoting Concorde001 (Reply 30):
"If the rest of Europe doesn't agree with delay and automatic termination, the UK will vote against 'open skies,"' the source said.

It all depends on how much the UK wants the US to terminate Open Skies; there is no great problem with a six month delay for LHR, until T5 is up and running, but an automatic termination? Are they kidding. Why should the whole of the EU have to terminate a deal which apparently only the UK wants? The UK will veto this at its own risk and it needs to know that the consequences will be very painful.

Alternatively, the EU could agree to these conditons, but in practical terms when it comes down to it, what will the UK do to force the other 26 EU countries to cancel their bilaterals just because the UK wants something no-one else wants. In practical terms, it just isn't going to happen.
 
jfk777
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 5:05 am

The issue of cabotage is rhettoric and nothing more. The days of the multi-stop international flights are over, the days when BA flew a leg of an Oriental bound flight stopping in say India are over. All flights are nonstop and back unless one of two condition exist: 1) the final destination is too far, Australia, for NONSTOP service. 2) the final destinaion is having bad economic times and one-stop servcie is the only way the flight viable, Buenos Aires as an extension of Sao Paulo service.
 
Concorde001
Topic Author
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 5:08 am

Quoting Kaitak (Reply 32):
Why should the whole of the EU have to terminate a deal which apparently only the UK wants?

I'm not sure that this is the case. If I'm not mistaken didn't the EU Transport Commissioner urge Britain, indeed all Europen countries to accept the current deal with the promise that ownership restrcitions would be dealt with later ?
I remember reading LH and AF-KL executives clearly saying that the current deal was a good foundation to achieve their ultimate goal of unrestricted investment/ownership of US carriers.
 
panamair
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 5:09 am

Quoting DiscoverCSG (Reply 20):
Well, how many of the big 6 have been in bankruptcy this decade? Frankly, many of our airlines are not in a position to compete with the major European and Asian carriers, either financially or in terms of their product offering. Then, some of our carriers (CO mainly, and to a lesser extent AA and US maybe) might do okay with that sort of competition..

Actually, the US carriers would be more than able to compete on a financial level; many US carriers, including most legacies through cuts (and Ch.11 filings) through the years, now have lower unit costs than their European rivals. Sure, some passengers will defect for a better product but as has often been noted, the majority of the domestic US market is extremely price sensitive and the bulk of the domestic market will continue to remain price-focused. Hence, lower-cost carriers will continue to have an advantage and it won't be a slam-dunk for foreign carriers with better products to make a killing.
And, having a great product is not a guarantee that the foreign carrier is a winner in some of these markets. Take a look at SQ in the transatlantic market - it struggled big time to make AMS-JFK work and in the end, had to pull out despite offering a better product than incumbents in the market (KL, CO, DL). Even today, SQ has to offer some rock-bottom fares on its remaining transatlantic route (FRA-JFK) to help sustain the route despite offering a better product than LH or DL in that market.

That's why most of the EU nations/carriers are no longer making such a big stink about gaining cabotage - they have seen the brutality of the domestic US market place with significantly trashed yields in many markets and no one really wants to start operating their own metal in many of these domestic US markets. Sure, they still see the huge market potential, but they would prefer to do it through a new, low-cost US subsidiary - hence the renewed focus on lifting ownership restrictions on US carriers....
 
IADLHR
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 5:21 am

Quoting Leezyjet (Reply 19):


2008 isn't all that far away. It is round about 12 months now until T5 opens.

What if there is somne unexpected delay between now and March, 2008 when T5 opens? Say for instance that the baggage system doesnt work properly like what happened in Denver? Does that mean the onset if openskies keep getting setback?
 
atmx2000
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 5:24 am

Quoting ANother (Reply 22):
Wow. Play this back 62 years to the Chicago convention. US representatives wanted NO economic regulation of the industry. No ownership and control rules. No traffic right restrictions. European side, with weak (or no) airlines following WWII wanted to protect their industry. US side didn't get what they wanted - settled for Bermuda I the following year and the rest is history.

Fast Forward to 2007 - all but one US airlines in, or recently in, bankruptcy. 1500 job losses in the last 12 months. etc. etc. etc.


I think there's more than one US airline that hasn't been bankruptcy.

Of course, part of the problem is that one suspects that EU is asking for this now because they think this is an opportune time to sweep in.

Quoting Bmiexpat (Reply 27):
Therefore in the meantime they will not stop individual EU nations from negotiating new bilaterals on an idivdual basis as long as they are open skies agreements, therefore making the eventual EU wide negotiations easier.

Except when it comes to the US. Anyway the EU courts declared the existing open skies agreements with the US to be illegal as the countries negotiating them usurped EU powers, so why would they allow more to be negotiated with other countries? And for the record many of the agreements that were negotiated aren't open skies. The bilaterals with India only increased frequencies and added new routes.

Quoting ANother (Reply 28):
The illusion of the 'crown jewels' of London's Heathrow airport is soon to be dashed. One, and likely the only, reason why LHR - US routes are so profitable is because they are limited.

LGW-US routes are limited as well, often times more limited. When you compare routes where there is assymetric competition between the US carrier flying to LGW and the UK carrier flying from LHR, you will find that the premium passengers prefer LHR. Why? A lot of businesses have located offices and HQs in the area around LHR. You can find similar phenomena in the US. For example in Chicago, way out in the 'burbs where O'Hare is, there is a huge number of large multistory office buildings hosting offices and HQs of many, many businesses. You think that is a coincidence? You don't believe me? Listen to BA:

http://www.britishairways.com/tfive/needfor/paspre.shtml

The majority of passengers who live in South East England want to travel from Heathrow and return there. It is the airport closest to nearly 60 percent of all passengers from this part of the country. Many businesses have located nearby for ease of access to Heathrow and thereby contribute to local employment and prosperity. For passengers flying into the UK, Heathrow is the airport closest to London, with the best transport facilities to and from the country's commercial, financial and tourist capital.

Quoting Vega (Reply 29):
It is more likely U.S. carriers would fore-go new LHR routes for Open Skies today, particularly since acquiring Slots is far from a certainty.

There are plenty of airlines flying narrowbodies into LHR. These airlines aren't likely making anywhere near as much as a US major could if they flew to LHR. The US airlines can make it worth their while for key routes, like EWR-LHR for CO and JFK-LHR for DL.

[Edited 2007-03-21 22:34:12]
ConcordeBoy is a twin supremacist!! He supports quadicide!!
 
IADLHR
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 5:24 am

Quoting Vega (Reply 16):
Why would the U.S. agree to this and put themselves in a position of negotiating a whole new treaty AFTER 4 or 5 U.S. carriers had already taken advantage of the previous agreement and started extensive new services to Europe? I can imagine the reaction of those carriers and their political allies if told they had to discontinue operations because Open Skies was terminated in 2010. If the U.S. accepted this condition, I'd bet very few, if any, U.S. carriers would take advantage of a 2 or so year treaty and commit significant new resources to Europe

That might be part of the motive too, the UK knows that the US airlines wopuld not start new service knowing the 2010 deadline was hanging over them. So BA and the UK win another round as there is no new competition at LHR.
 
commavia
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RE: Britain To Agree To Open Skies...Strings Attac

Thu Mar 22, 2007 5:25 am

Quoting IADLHR (Reply 36):
What if there is somne unexpected delay between now and March, 2008 when T5 opens? Say for instance that the baggage system doesnt work properly like what happened in Denver? Does that mean the onset if openskies keep getting setback?

T5 delay or no T5 delay, I doubt the U.S. will ever agree to another delay. This is Britain's one freeby because Bush doesn't want to totally screw Tony Blair. Beyond March 2008, I highly doubt the U.S. or the E.U. will agree to any more pushbacks or special carve-outs.
 
express1
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 5:25 am

Quoting Commavia (Reply 31):

To what sort of the tiny manority of people are you aiming at, the residents? and how can you class this as a seperate issue, the UK cant agree to Open Skies and let the flood gate open to an airport that has no room to expand, and i wouldn't give my house up for all the money in china.


dave
David.S cavanagh since 1961,if you can do better,then show me.
 
bmiexpat
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 5:33 am

Quoting Atmx2000 (Reply 37):
Anyway the EU courts declared the existing open skies agreements with the US to be illegal as the countries negotiating them usurped EU powers,

The EU declared them illegal because they went against EU free trade laws..... when the bilaterals were originally agreed the EU/EEC/or whatever it was called at the time had not decided that aviation agreements had to be made at an EU level, and so no EU powers were usurped.

Quoting Atmx2000 (Reply 37):
And for the record many of the agreements that were negotiated aren't open skies. The bilaterals with India only increased frequencies and added new routes.

However, all agreements made in recent years have led to the opening up of markets, increasing frequencies and the number of permitted operators, all of which have led to greater competition. Even if this open skies treaty fails, the EU will not stop the affected EU nations from pursuing their own open skies/further liberalising treaties with the US as they all lead to further free trade.
 
StarGoldLHR
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 5:33 am

Quoting Ikramerica (Reply 15):
Again, this gets to the fundamental mistake the UK is making. They are equating LHR-FRA with JFK-SFO. A 5th freedom flight with cabotage. And they are doing so because the EU is trying to equate itself with the USA. We are one nation, the EU are not. If they want to become one nation, bully for them. Do it.



Quoting Ikramerica (Reply 15):
I just want to add, the USA and EU negotiated in good faith. For the EU to entertain or adopt the 2010 deadline is not in good faith. Why should we in the USA feel as if any future negotiations would be in good faith?

If the UK didn't want to be part of the EU, they shouldn't have joined...

You two statements are typically biased.. one in favour of the EU the other against the EU. Which side of the fence are you sitting on Ikra ?
So far in 2008 45 flights and Gold already. JFK, IAD, LGA, SIN, HKG, NRT, AKL, PPT, LAX still to book ! Home Airport LCY
 
AeroWesty
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 5:41 am

Quoting Commavia (Reply 31):
That being said, Heathrow's prime close-in location, easy tube access, and virtually unlimited connections to everywhere, make it the airport of choice for the high-yield business travelers that airlines make decisions based on.

Part of what you wrote is why I believe that if the U.K. continues to protect LHR, it will diminish in its importance. There are already other gateways where a vast majority of the connections LHR provides are available without the Heathrow Hassle. I forget what the exact number is, but isn't it something like 14 or 17 interior U.K. cities where connections are available via AMS vs. 4 to LHR on BA? Secondly, I don't know of many high-yield business travelers who take the Tube into London--certainly there are some, but high-yield passengers scarf up taxis or the free limo rides some airlines offer, like they do when the tray of bacon buttys is laid out in the Terraces lounge.

So no one gets the wrong impression about my feelings on the issue, yes, I believe airlines have proven LHR is where the money is over LGW at the moment. But I also feel that for the general traveler LHR is becoming less important, and that high-yield passengers will follow suit as CDG, AMS, and FRA continue to build upon their successes. Let's remember that the EU has stated there will be a 50% increase in traffic across the Atlantic within 5 years if this accord is signed. LGW will, at least in my mind, always offer an attractive alternative to LHR for the U.K.-bound passenger not interested in connecting through to a third airport.
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Humberside
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 5:50 am

Quoting Leezyjet (Reply 19):
It would also allow the Airport Authority to see which terminal has the required amount of gate space needed at the right times of day for the new entrants to LHR.

Wont CO/NW/DL go to T4 with the other SkyTeam carriers and US to T1 with the Star carriers?

Quoting Concorde001 (Reply 30):
Britain is not a protectionist country.

Doesn't seem that way to me at the moment

Quoting Concorde001 (Reply 30):
And to be perfectly honest, the British Government is not trying to protect BA - this is the same government that refused to provide money to BA and other UK airlines to pay for security and restructuring when BA was nearing bankruptcy in 2001! The British Government is simply pursuing its national interest, just like the US does all the time (and rightly so).

What national interest? I can't see how keeping LHR restricted is in the UK national interest. Lower fares, more flights from LHR to the US, seems to be good for the UK to me

For once Im actually glad the UK is part of the EU here. Could be one of the few good things the EU does for the UK getting ope skies, IMO
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bmiexpat
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 5:52 am

Quoting AeroWesty (Reply 43):
I forget what the exact number is, but isn't it something like 14 or 17 interior U.K. cities where connections are available via AMS vs. 4 to LHR on BA?

Whether LHR only has (between BA and bmi) 9 domestic connections to international flights, the worldwide network of destinations and frequencies from LHR provided by BA and all the other airlines that serve the airport is without competition in Western Europe.
 
AeroWesty
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 6:06 am

Quoting Bmiexpat (Reply 45):
the worldwide network of destinations and frequencies from LHR provided by BA and all the other airlines that serve the airport is without competition in Western Europe.

Yes, I understand that, and have made myself clear on that issue, I believe. However, with the projected growth of traffic just in the next 5 years, something has to give somewhere. CDG has loads of room to expand, if I'm to believe what has been written on these boards. MUC is emerging as a second successful German hub. My point is that what's available at LHR today will be mimicked through if not one, then a combination of gateways within Europe, and that shouldn't be overlooked by the U.K. As I've said before, this is their game to lose.
International Homo of Mystery
 
vv701
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 7:47 am

Quoting Ikramerica (Reply 15):
Again, this gets to the fundamental mistake the UK is making. They are equating LHR-FRA with JFK-SFO. A 5th freedom flight with cabotage. And they are doing so because the EU is trying to equate itself with the USA.

My interpretation of a true Open Skies agreement is that if the airlines of one party can offer a specific service, so the airlines of the other party should be able to offer the same service. Hence if BA operate from their LHR base or hub on the LHR-JFK route then DL should be able to operate JFK-LHR from their JFK hub and if BA can operate from LHR to EWR then CO should be able to operate from their EWR hub to LHR. The challenge would be to find sufficient slots at LHR to meet any reasonable DL and CO demand so they could operate these services.

Similarly if UA operates services such as SFO-JFK-LHR (as they already do with UA956), LAX-SFO-LHR (currently UA930), PDX-ORD-LHR (currently UA928) and, amongst others HNL-LAX-LHR (currently UA934) then BA, VS, BD and, of course, any other UK or EU airliner should be allowed to operate matching services with matching traffic rights. It is here that the argument about cabotage raises its ugly head and if US airlines are to be allowed to continue to operate such services but EU airlines are not then the so-called Open Skies agreement is clearly more open to one side's airlines than the others and the playing field is not level.

Right from the start in this thread there has been discussion of majority foreign ownership of what are currently American and European airlines. But is this really possible? For example if VS was 51 per cent let alone 100 per cent owned by SQ (instead of the current 49 per cent) and if BD was 50 per cent plus one share owned by LH and SK (instead of the current 50 per cent less one share) then would this not make VS a Singaporean Airline bound by Singapore agreements with other countries (be they bilateral or Open Skies) and BD an EU airline only able to fly within the EU or to countries where the EU (as opposed to the UK and/or Germany and/or Scandinavia) has bilateral or Open Skies agreements? As long as bilateral agreements remain of any significance in world-wide commercial aviation can foreign control let alone ownership even be considered?
 
ba747yyz
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 8:34 am

You all know why the delays there... So BA can buy as many spots at LHR as they can get a hold of before the American carriers can start buying.
Also part of their strategy to keep US-LHR business is the new club world, and the best of all: lower prices.
 
commavia
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RE: Britain To Agree To Open Skies...Strings Attached

Thu Mar 22, 2007 11:20 am

Quoting Express1 (Reply 40):
To what sort of the tiny manority of people are you aiming at, the residents? and how can you class this as a seperate issue, the UK cant agree to Open Skies and let the flood gate open to an airport that has no room to expand, and i wouldn't give my house up for all the money in china.

First off, the reason the two are seperate is because, as the last few weeks has clearly shown, one is not required for the other. E.U.-U.S. Open Skies looks to now be a done deal, and moving forward, even though, as you rightly say, Heathrow is nowhere near prepared for it and its airfield and facilities are already overtaxed and overcrowded as it is.

As for the people living there, I have absolutely no sympathy. First off, I would be interested to find out what percentage of the people living in those houses today lived there when Heathrow as built, back in the 1930s. My guess is that the answer to that question is 0. Everyone who lives there knew what they were buying when they bought the houses -- they knew about the noise, the congestion, the pollution, etc. No excuses. Secondly, even if they don't want to sell, the U.K. government should buy the properties with sweetheart terms and just force them out. Sorry, it's rough and I am not a big advocate of imminent domain and taking people's private property. But in certain cases, like when the economic viability of a region and quite possibly a country at least partially hangs in the balance, choices have to be made. Should these 1,000 people really be allowed to hold up a third runway at Heathrow, which is likely -- as Aerowesty and others have alluded too -- probably the last chance Heathrow has of really remaining competitive in the 21st century?

Quoting VV701 (Reply 47):
It is here that the argument about cabotage raises its ugly head and if US airlines are to be allowed to continue to operate such services but EU airlines are not then the so-called Open Skies agreement is clearly more open to one side's airlines than the others and the playing field is not level.

But again, therein lies the problem. In the eyes of the U.S., virtually every other country on earth, the United Nations, and indeed virtually every member state of the E.U. itself, the European Union is not the same as the United States. The United States is a sovereign nation, and thus flights between two points within its borders is cabotage, and thus not permitted for E.U. or any other foreign flag carriers. The E.U. is not, at least yet, a sovereign nation, and is not recognized as such by -- to my knowledge -- any entity or body in the world. As such, a flight by a U.S. carrier between two points within the E.U. is not necessarily cabotage. If AA wants to fly from Heathrow to Glasgow, that's cabotage. But if Delta wants to fly from Paris to Milan, that is not cabotage -- it is a fifth freedom flight between one sovereign nation and another sovereign nation.

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