US presidential election may spell trouble for “Open Skies”

With an American presidential election scheduled to take place in November 2008, the expansion of the “Open Skies” deal between the US and the European Union may face new obstacles, especially if a sense of protectionism takes hold among Americans. British Airways is one of the main advocates behind the complete liberalization of transatlantic air travel, within the next two to three years. This would essentially mean that any carrier in the EU and all carriers in the US could fly to any destination on either side of the Atlantic Ocean, without any restrictions. If all current restrictions are lifted, British Airways—and other European airlines—would be permitted to enter the US domestic market and operate flights between American cities. European carriers that own shares in US airlines would also be granted more leverage.

Opening up the US domestic market to foreign carriers, as well as allowing them to have voting rights when it comes to the fate of American carriers are both sensitive issues in the US, as they touch on American economic sovereignty. Protectionism may also turn into an important issue in the next presidential election, partly due to the on-going trouble in Iraq, the unpopularity of the war and the consequent tendency among many Americans to look inward.

British Airways supports further liberalization of the transatlantic market, because under the current Open Skies agreement the UK-based airline stands to lose some of its prominence at London Heathrow. Europe’s busiest airport will now be opened up to a broad range of EU carriers and this means more competition for BA on a range of routes. With further liberalization, however, BA might just become a more important player within the US air travel market.

www.britishairways.com