Richard Branson, chairman of Virgin Atlantic, is calling for the US to open itself up to cabotage, saying he would open an airline there 'tomorrow.'
Branson has briefed US congressmen on his wish to see the rules changed so foreign carriers can operate domestic services in the US. 'We believe that if Brussels-based Virgin Express were to come to America, we would be a formidable competitor,' he says.
With Congress increasingly concerned about the lack of new competition in the US domestic airline industry, Branson's idea appears to have fallen on receptive ears. The only major concern is employment, and Branson pledges to employ almost 100 per cent US staff, including pilots.
'This is not hopeless idealism,' insists Branson. 'It is the future and we had all better realise it.' The best competitive environment, he says, would be one where every European carrier had unlimited access to serve the US and vice versa.
Frederik Sorensen, head of air policy at the European Commission Transport Directorate, seems to agree. At the Federal Aviation Administration's forecast conference in Washington DC in March, Sorensen echoed the call for the US to open its doors to seventh freedom operations.
Sorensen says he expects to see a totally open, multilateral aviation agreement in place between ten European countries and the US by late 1998 or early 1999, but says the US has been 'much more cautious'. The issues of carrier ownership and cabotage seem to be almost 'taboo' to the US, he says.
However, Sorensen warns the US government and individual carriers not to feel too comfortable about existing codeshares, alliances or even open skies agreements.
Sorensen says he finds it difficult to tell codeshares and alliances apart. 'Those codesharing have been living an enchanted existence so far. But nobody should take them as an acquired right, and I think sooner or later they will have to be assessed.'
While Sorensen admits it would be 'extremely difficult to unscramble' all the established individual bilaterals, the Commission remains committed to pursuing a European-wide open skies agreement with the US. Ultimately, Sorensen says, this might mean nullifying existing bilaterals.
To this end, transport commissioner Neil Kinnock is writing to eight EU member states to warn them that their US bilaterals contravene EU law by discriminating between carriers from different member states.
But David Schwarte, managing director for international affairs at American Airlines, is worried by any question mark over who has the authority to negotiate. Such uncertainty, he says, can only mean 'more delays' for the proposed British Airways/AA alliance, which hangs on a US/UK open skies bilateral being forged.
Source: Airline Business
