British Airways chief executive Bob Ayling is hopeful that the US/UK open-skies negotiations will be back on track by the end of September, despite the breakdown in the latest round of talks.
Doubts were raised over the state of relations between the two sides after the US Department of Transportation (DoT) cancelled the talks, scheduled to have begun in Washington, DC, on 28 August. The UK Department of Transport says that it had submitted a new draft agreement but it was rejected. It is understood that no date has been set for the talks to resume.
Ayling dismisses the seriousness of the breakdown, saying that he expects discussions to resume by the end of September. "Disagreements and bust-ups always characterise serious bilateral negotiations, and indicate that something is actually happening...there is good will and good sense on both sides," he says. He argues that both sides ultimately want an agreement, adding that there is no reason why the talks will not "proceed to a satisfactory result".
The granting of US anti-trust immunity for BA's planned alliance with American is linked to the signing of an open-skies deal and the two airlines accept that the deal cannot effectively go ahead unless such a deal is signed.
Ayling also dismisses suggestions that BA will have to relinquish slots at London Heathrow as a condition for the deal. He points out that the airline's 38% share of slots at its main hub is less than that of rivals, such as Lufthansa at Frankfurt. He argues that giving airlines a free hand to trade their slots would provide the best way of allowing new entrants into Heathrow.
Meanwhile, USAir is pressing ahead with its legal action against BA, which alleges that the American deal violates parts of its own marketing pact with the UK airline. USAir appears intent on breaking off the pact, which included BA investing $400 million for a 26% stake in the airline, leaving it free to pursue its own ambitions across the North Atlantic.
USAir has joined Continental Airlines and Trans World Airlines as the latest of the US carriers to apply to the DoT for permission to fly to Heathrow. USAir wants to fly there from Boston, Philadelphia, Pittsburgh and Charlotte.
Stephen Wolf, USAir chairman, says that clearance for his airline would ensure competition for the BA/AA alliance and "cement USAir's position as a significant presence in the transatlantic marketplace".
Source: Flight International