The UK has cancelled talks on a new air services treaty with the USA after failing to persuade UK carriers to adopt a position likely to lead to agreement on a liberal "open skies" bilateral.

Formal negotiations had been due to resume in Washington DC during the week beginning 5 July, but were cancelled at London's request. Whitehall and airline sources say the main sticking point concerns slots at Heathrow, with the USA demanding that more positions be made available to US carriers - and more quickly - than UK flag carrier British Airways is prepared to agree.

BA sources add that the carrier has never been prepared to submit to a "dumb deal", and that any new agreement "has got to be good for shareholders and for the airline". A recent offer by BA to relinquish slots was rejected by the government as it would be inadequate to meet US demands.

The UK Department of the Environment, Transport and the Regions (DETR) says UK carriers will be approached to modify their stance, to kick -start negotiations, but it confirms no new date for a resumption has been set.

Source: Flight International