Virgin Atlantic Airways chairman Richard Branson has touched a nerve in the USA by calling for seventh freedom rights so that he can start a low-fares, low-cost, airline. His calls for cabotage came in the same month that a senior US Department of Transportation (DoT) official questioned whether current aviation restrictions make sense in the light of globalisation.
Branson's urging of seventh freedom rights comes as no surprise. He has become increasingly vocal throughout the year on his view that open skies should be truly open and allow overseas carriers to operate freely in the USA.
At a press conference in Washington DC on 24 September, he stepped up his campaign, revealing that his proposed US carrier would be known as Virgin America and would promise "value for money, great service and plenty of fun".
It is Branson's other offer that will hold most appeal for US politicians and legislators, however. "I relish the challenge of establishing Virgin America in the States," Branson told the US media. "Virgin America will give the big six some real competition." With competition a hot issue on Capitol Hill this year, that message is being heard by those able to make the legal changes for which Branson is calling.
While Branson's campaign is dismissed by some as a mere publicity stunt to stir trouble for the proposed American Airlines/British Airways alliance, the timing is perfect. In the same week, Charles Hunnicutt, DoT assistant secretary for aviation and international affairs, said at the Washington Deregulation 20 Summit that the time may have come for a review of aviation rules.
"We have worked together to dismantle many of the restrictions that some other countries have placed on international services. I think the time has come for all of us to question restrictions that many countries, including the USA, continue to impose on them," he said. "Do those restrictions continue to make sense in light of the globalisation of markets for goods and services?" Cabotage rules, he added, would benefit from an "open and public" dialogue.
Some US carriers, including FedEx, say that they would support a lifting of cabotage restrictions if there were full reciprocal rights. But the labour hurdle will be enormous. The US Air Line Pilots Association has already spoken against the idea, with national president Randolph Babbitt insisting he "-cannot fathom" a reason to support cabotage in the USA.
Branson is attempting to diffuse the labour issue by making it clear that Virgin America would employ 100% US personnel in the cockpit and on the ground. But that promise will not be sufficient to quell labour fears.
Source: Airline Business
