Closer ties with American Airlines essential for BA strategy: Walsh |
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Published
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Mon, 10 Oct 2005 16:05
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LONDON: British Airways is looking to establish a closer working relationship with US carrier American Airlines, which chief executive Willie Walsh, 43, said would benefit customers.
Closer links between the two would result in better scheduling of flights and more competitive ticket pricing. It would also mean better connections to US cities.
The statement from BA has sparked talks of a possible transatlantic merger. When asked whether there was any substance to the speculations, Mr Walsh did not rule out the possibility, but added that a merger was “a completely different agenda”. Right now it was more important for BA to establish closer ties with the US carrier.
Currently, there was a restriction on the number of flights allowed between Heathrow airport and the US’s east coast, limiting the choice of flights for passengers flying to and from US destinations.
Mr Walsh hoped the European Union’s ‘open skies’ agreement with the US government would increase commercial air traffic between the UK and the US.
An earlier attempt to establish closer ties between the two airlines (in 2002) was scotched by US regulators who said both the airlines would have to give up 254 take-off and landing slots at Heathrow otherwise they would attract anti-trust scrutiny. Surrendering so many slots seemed too high a price for BA which quickly backed out.
Mr Walsh’s agenda has another tough nut – the final salary pensions deficit of £1.4 billion, which he hopes to crack with his ‘Time-to-Talk’ programme with his staff. Under this plan BA will discuss with staff some possible options like asking the staff to increase their contribution into the fund, increasing the retirement age or offering cash incentives to opt out of final salary schemes.
The two airlines are members of the Oneworld airline alliance.
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