American Airlines and British Airways are to make some of their slots at either Heathrow or Gatwick airports, according to an announcement from the UK’s Competition and Markets Authority. The move – which is subject to consultation – is “part of a wider package of measures to resolve competition concerns regarding their joint business on certain routes between the UK and US.”
Since 2018, the CMA has been investigating the impact on customers on US-UK routes from the loss of competition due to the Atlantic Joint Business Agreement (AJBA) between AA, BA, Iberia, Finnair and Aer Lingus.
The findings “identified potential competition concerns on routes between London and each of Boston, Chicago, Dallas, Miami and Philadelphia.” As a result a package of measures has been proposed, including:
•Releasing additional take-off and landing slots at London Heathrow or Gatwick airports to enable competitors to begin or increase non-stop flights between London and Boston, Dallas and Miami
•Measures to support competing services on these routes as well as on the London to Chicago and London to Philadelphia routes, including access to connecting passengers on preferential terms
In practice this will mean one daily slot pair being surrendered on each of the routes from London to Boston, Dallas, Miami and (subject to certain conditions) Philadelphia.
Certain undertakings have also been agreed to operate a minimum number of flights on the London-Dallas and London-Philadelphia routes, “until and unless” another carrier takes up the slot(s).
It should be noted that the CMA’s investigation began long before the current coronavirus crisis, which now threatens the future of transatlantic carriers such as Norwegian and Virgin Atlantic. In the current competitive climate, the Authority said that “the commitments allow for the CMA to review the AJBA if competitive conditions are different in the future, for example, when the sector is expected to have emerged from the pandemic”.
Full details of the CMA’s findings can be read on the gov.uk website.