Dominic O’Connell
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ONE of America’s biggest airlines has stunned industry experts by securing enough Heathrow runway slots to start services there next April when a new open-skies regime will open up the airport.
Delta has gained access to Heathrow’s runways after negotiations with Air France and KLM, its European partner airlines, according to chief executive Gerald Grinstein.
This will be a blow to BA and Virgin. Before open skies, only they and two other airlines - American and United - could fly from Heathrow to the US. The two British carriers tried to stop open skies, but thought damage would be limited by the difficulty new entrants encounter in gaining access to Heathrow. Its runways are full, with take-off and landing slots the most highly prized in world aviation. Pairs have changed hands for £10m.
Analysts expect Delta to fly twice a day to New York, and once to Atlanta, its main hub.
Grinstein said: “We will have the slots available to us.” He did not specify whether Air France or KLM would provide them. But he noted that “the economics of flights from London to Charles de Gaulle [Paris’s main airport] have certainly changed since the opening of the Channel tunnel”.
KLM and Air France are likely to codeshare on the Delta flights, which means that, for the first time, airlines from the Continent will have their codes on a service from Heathrow to the US. Delta, Air France and KLM are all part of the “Skyteam” alliance, which competes with the Oneworld alliance led by British Airways.
Delta’s success in finding slots at Heathrow may cause analysts to reassess the impact of open skies on BA, which makes the lion’s share of its profits from its North Atlantic routes. Its New York-London flights are particularly important.
Other big US carriers are likely to follow Delta’s lead. Insiders suggest KLM, which operates some of the few remaining services into Heathrow with small tur-boprop aircraft, may provide slots to Northwest Airlines, while Aer Lingus yesterday confirmed it had received approaches about its Heathrow slot holding. It said, however, that it had no plans to change its operations there.
Andrew Lobbenberg of ABN Amro recently estimated that open skies could reduce the prof-itability of BA’s American services by 25%-53%.
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Good grief, Vivek. Simmer down with the nationalism. Its not a knock on India, but rather its just how the Bermuda II Agreements are structured. Air India's arrangement for flights between JFK and LHR is based on the Freedom's of the Air (numero five) and they probably had to negotiate and make concessions for that right with the British government. I'm sure that there are limits on the number of seats Air India can sell to passengers only flying between those airports and not continuing on to a final destination in India.
Marty, Washington, DC
Oh, but you can challenge American and United. Delta, in particular has been busily building the sort of network which attracts corporate contracts for business travel. Access to Heathrow, in particular, has been a major obstacle.
Both American and United depend HEAVILY on their European partners to get them to a city from Frankfurt or LHR. Delta does this some with CDG, but provides non-stop service to most major European destinations, often from multiple departure cities.
To the business traveler, TIME IS MONEY, and they pay $$$$.
Steve Stone, Atlanta, GA / USA
In my view, this is termed because only two European & two US airlines are allowed to fly between Heathrow and USA. A company is strong in home turf, like BA/Virgin are strongest in UK. Likewise, you cannot challenge the strong market base of American and United in USA. Airlines generally based overseas do not pose similar threat like home overseas airlines.
Upinder, Birmingham,
To follow up with Alex...in the 70's I flew Iran Air and Pakistan Int'l from LHR to JFK; are those slots dormant? Iran Air, I understand.
Daryl Hawes, Atlanta, Georgia USA
Not just Air India ... what about Kuwait Airways ! Both have been plying between LHR and JFK for decades.
alex, london heathrow,
Why does the media keep saying that only 4 airlines (2 British, 2 American) were previously able to fly Heathrow to New York when Air India have been flying that route for ages?
Vivek, London,