EU agrees 'open skies' deal

mixu

It might not mean much to most people but the EU has finally agreed an 'open skies' deal with the US which essentially opens up Heathrow to competition across the Atlantic from next March... BA and Virgin aren't very happy about it but that's only because their monopoly's going to end.

BMI will finally begin long-haul flights out of Heathrow but talks of a price war will depend on carriers gaining slots which are in short supply. The consumer, however, can only win.

http://news.bbc.co.uk/1/hi/business/6477969.stm

wdyw

mixu wrote: »

It might not mean much to most people but the EU has finally agreed an 'open skies' deal with the US which essentially opens up Heathrow to competition across the Atlantic from next March... BA and Virgin aren't very happy about it but that's only because their monopoly's going to end.

BMI will finally begin long-haul flights out of Heathrow but talks of a price war will depend on carriers gaining slots which are in short supply. The consumer, however, can only win.

http://news.bbc.co.uk/1/hi/business/6477969.stm

Goodish news. We shafted the USA with the Bermuda agreement in 46 and moreso with Bermuda II in 77 but it was only a matter of time before the USA got the fifth freedom and cabotage rights they have been after since the days of President Carter. It will be interesting to see what the fine print does say and whether there will be any capacity controls and break of gauge rights. What would really help us in the UK was for us to follow the USA on landing, navigation and en-route charges. Historically it was the smaller European countries that wanted open skies with NA while the big three of france Germany and the UK wanted even stricter controls.

The last figures I came across had the landing fees at Manchester being the most expensive in the world. (in mid/late 80's). Cost $8157 to land a 747 with a load factor of 70% compared to $6477 at Heathrow and $490 at San Francisco. ..and as for en-route costs, to fly the same 747 500km over the UK cost $1134 while over the USA its completely free.

blindman

mixu wrote: »

It might not mean much to most people but the EU has finally agreed an 'open skies' deal with the US which essentially opens up Heathrow to competition across the Atlantic from next March... BA and Virgin aren't very happy about it but that's only because their monopoly's going to end.

BMI will finally begin long-haul flights out of Heathrow but talks of a price war will depend on carriers gaining slots which are in short supply. The consumer, however, can only win.

http://news.bbc.co.uk/1/hi/business/6477969.stm

Mentioned that here

Delayed until next March

However, at Britain's request, EU ministers agreed to delay plans to implement the deal from October this year to March 2008.

General discussion on flyertalk
BMI thread on flyertalk

WiseInvestor_2

I wouldn't expect to see a rush of new airlines flying into Heathrow any time soon, as the comment above explains how slots are scarce and [often] prohibitively expensive, especially for the less well-established carriers.

I'm very surprised we've not heard more from the environmental campaigners as we're about to witness a MASSIVE increase in air traffic crossing the Atlantic. In the short term prices should drop which would be good for the consumer, but longer term we'll see airlines struggling to fill the over-capacity and increasingly look for merger opportunities or risk going bust.

I think we're on the verge of monumental changes in the airline sector but I doubt much of it will benefit the travelling public.

wdyw

WiseInvestor wrote: »

I think we're on the verge of monumental changes in the airline sector but I doubt much of it will benefit the travelling public.

Don't know about that. Re-regualtion has been happening since the 1970's and at just about every step of theway has led to cheaper faresfor the public. Have a look back at the cost to fly London- NY before Laker went to court over double designation (and then convert that price to modern terms!!!). British Cascade Study from those days showed why non-scheduled flights were typically 36% of a scheduled flight cost. Times have moved on and while the various savings have changed there is no doubt that the cost of scheduled flights across the pond will now change. It's the fifth freedom rights/ break of gauge rights, cabotage rights etc that have a lot of EU based airline companies worried, and rightly so! Unless its covered in the fine print, there were always darn good reasons why the UK and other major European countries always knocked the USA back on modifying their respective bilateral agreements.