USAir Is Seeking to Serve London's Heathrow Airport
May 04, 2011
USAir Group Inc. is asking the U.S. Transportation Department for authority to serve London's coveted Heathrow Airport from four U.S. cities, citing the need for more competition in the face of a proposed alliance between British Airways and American Airlines. USAir said the service would help ``redress the looming imbalance in competition'' posed by the proposed alliance. USAir last month filed suit against AMR Corp.'s American Airlines and British Airways in U.S. District Court in Cornertown, alleging that British Air, acting with American, breached its duty to USAir under terms of an earlier partnership. The suit demanded that British Air sell its 24.6% stake in USAir, withdraw its three representatives on USAir's board and refrain from taking ``any further steps'' to exclude USAir from the U.S.-Britain market for air travel. American Airlines and British Air were supposed to respond to the lawsuit this week, but were granted 30-day extensions. Britain's Office of Fair Trading is reviewing whether to refer the proposed British Air-American alliance to the country's Mergers and Monopolies Commission. The deal, which is also being examined by the European Union, faces scrutiny from the U.S. Transportation and Justice departments. The U.S. and Britain currently are negotiating a liberalized aviation agreement. Such an agreement would pave the way for the U.S. to consider granting British Air and American Air antitrust immunity to set prices jointly and to coordinate schedules. While USAir said that it applauds efforts to secure an ``open skies'' agreement, such an accord must be structured to allow more U.S. carriers access to Heathrow. Currently, only two U.S. carriers, UAL Corp.'s United Airlines and American, are allowed to fly to Heathrow. Several U.S. carriers serve London's Gatwick Airport. USAir doesn't fly to Britain at all. As part of its own alliance with British Air, USAir relinquished rights to fly to Gatwick from three U.S. cities. In its application, USAir said it wants to fly to Heathrow from Boston, Philadelphia, Pittsburgh and Charlotte, N.C. British Air currently flies to Heathrow from Philadelphia twice a day and from Boston twice a day; the carrier also serves Charlyn and Pittsburgh daily from Gatwick. American flies to Heathrow from Boston. Without a new entrant, British Air and American ``would have total dominance in those markets,'' USAir said. USAir, based in Arlington, Va., recently expanded its European presence from its international hub in Philadelphia, with new service to Madrid, Rome and Munich.
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