American Airlines and British Airways muted their response Wednesday to demands by European regulators that the airlines give up 19 flights daily to London’s two airports in exchange for the European Union’s blessing of their alliance.
But Elk Grove Township-based United Airlines, the world’s largest airline, blasted demands by EU regulators that it give up as many as eight flights daily between Chicago, Frankfurt, and Copenhagen in exchange for EU approval of its two-year-old alliance with Lufthansa Airlines and Scandinavian Airways.
Lufthansa took it one step further saying it will sue EU regulators if they attempt to force the now-powerful Star Alliance to shed any of the flights they fly between the United States and the two European cities.
Chances are slim, however, that either set of conditions will be imposed because the EU said it will give the airlines 30 days to challenge its proposals. While British officials indicated they plan to impose the final EU edict on American and British Airways, observers said it’s unlikely German officials will impose the conditions on Lufthansa, its national airline.
The alliances permit airlines to provide seamless travel around the world on a single ticket even though passengers and their luggage may be changing airlines.
Though United officials were fuming over the EU decision, American Airlines Chairman and Chief Executive Don Carty indicated American and its partner might be willing to live with most of the terms of the decision. The alliance between American and British Airways, Europe’s largest airline, which was proposed nearly two years ago, has been denounced as a menace to fair competition on trans-Atlantic routes by United Airlines and other rival airlines.
When BA and American announced their intention to link up, competing airlines complained the alliance would control 60 percent of the traffic between Britain and the United States, squeeze competitors out of the skies and push up prices for trans-Atlantic travelers.
To prevent that, the EU said BA and American will have to relinquish up to 133 of their nearly 400 weekly U.S. flights at London’s Gatwick and Heathrow airports if rivals request it.
But Cyril Murphy, vice president of international and regulatory affairs for UAL Corp.’s United, while applauding EU’s decision to crack down on the American/BA pact, said European regulators are meddling in an area where they don’t belong, at least as far as United and its partners are concerned.
Within minutes of the EU’s announcement, United filed a complaint with the U.S. Transportation Department over the EU’s efforts to regulate how and where it can fly without governmental controls.
For United, the eight daily flights the Star Alliance would have to cede to competitors represent 28 percent of the daily trans-Atlantic flights United, Lufthansa and SAS have between Chicago, Frankfurt and Copenhagen.
For American and British Airways the 19 flights they would have to give up represent 35 percent of the trans-Atlantic flights between various U.S. cities and London.
Murphy, who noted that the alliance between Lufthansa and United was part of a bilateral agreement opening German skies to foreign competition, said: “What we really think is going on is an internal European dispute over who has the right to negotiate these bilateral agreements.”
He said it was unfair to impose conditions on the Star Alliance, a worldwide linkage of the three European carriers, Canadian Airlines, and three Asian airlines, because no airline has been denied access to landing or takeoff positions at either Frankfurt or Copenhagen.
