Business Travel News - June 29, 2009 - (Page 21)

EuroBTN EU Negotiator Upbeat For Second-Round Open Skies Talks By Amon Cohen Fresh talks between the European Union and the United States on a second phase of the Open Skies agreement were scheduled to get underway in Brussels late this month, with lead EU negotiator Daniel Calleja telling EuroBTN he is optimistic that the U.S. government can be persuaded to sign—though not immediately. Phase One, which went into effect in March 2008, handed U.S. carriers their main wish of gaining unlimited access to London’s Heathrow Airport. This was achieved through allowing EU and U.S. carriers to fly from any point in the United States to any point in the European Union. Phase Two is scheduled for introduction by November 2010 but has yet to be agreed upon, and the European Union wants to achieve its two principal aims of loosening restrictions on foreign ownership of airlines and allowing onward services within the United States. The talks, which were set to take place on June 25 and 26, after Business Travel News went to press, will be the first since Barack Obama took office as president of the United States, and the new administration has not yet made clear its views on Phase Two. The ownership issue in particular has run into stiff opposition on Capitol Hill, and unions also have objected because they fear jobs could be lost if U.S. airlines are acquired by European carriers. With Democrats traditionally having stronger ties to unions than their Republican rivals, European airlines fear the Obama administration could take a hostile, protectionist stance, especially during the current economic crisis. Calleja, the European Commission’s director for air transport, told EuroBTN he will work hard with unions and other labor stakeholders to persuade them that Open Skies is in their interest, not against it. “It is true that labor has expressed concerns on both sides of the Atlantic,” said Calleja, “but we believe that removing ownership restrictions would lead to greater success in creating jobs. We don’t think this should be a concern. On the contrary, it is a real opportunity.” There is considerable pressure on One as a success, adding that it has led to an increase in transatlantic flights from Ireland and Spain, while British Airways has launched services to New York from Paris and Amsterdam through its new all-business- “Labor has expressed concerns on both sides of the Atlantic, but we believe removing ownership restrictions would lead to creating jobs.” EUROPEAN UNION’S DANIEL CALLEJA Calleja to deliver, because U.K. carriers are likely to lobby hard for the abandonment of Phase One of Open Skies if an agreement cannot be reached. “I am not worried. As a negotiator, I am always very positive,” said Calleja, who is tasked to provide a progress report by the end of this year. Phase One led to four U.S. carriers— Continental Airlines, Delta Air Lines, Northwest Airlines and US Airways— and Air France launching services from Heathrow to the United States for the first time, although some of these flights have subsequently been axed owing to the recession. Nevertheless, Calleja regards Phase class subsidiary OpenSkies. Furthermore, he said, non-EU members Norway and Iceland have both applied to join Open Skies. A British Airways spokeswoman said the airline has not suffered from increased competition at Heathrow. However, as a result of that competition, the U.K. flag carrier is hoping this will clinch antitrust immunity for its proposed partnership with fellow Oneworld airlines American Airlines and Iberia. “With five new airlines operating transatlantic flights from Heathrow, we believe the competitive landscape at the airport has changed dramatically since 2001,” she said. ■ The news items on this page originally appeared in EuroBTN, the new weekly newsletter that features the latest European business travel news, research, analysis and interviews, brought to your inbox by the editors of Business Travel News. To sign up for EuroBTN, please visit btnonline.com/newsletter. Oneworld Alliance Ups European Small Business Sales The Oneworld airline alliance enjoyed a significant increase in sales of its Businessflyer fares for small European businesses last year, but remains blocked from negotiating meaningful deals for larger corporations by lack of antitrust immunity. Commercial director Filip Lemmens told EuroBTN that the current permission of antitrust immunity for rival alliances SkyTeam and Star Alliance, allowing them to negotiate as single entities with corporate clients, is unjust. “We have a global corporate sales solution but it is limited in reach and attractiveness because of lack of antitrust immunity,” he said. “It is an unfair environment to compete. It is a lot easier for the other alliances to apply corporate offers. We should be allowed to do that too.” Oneworld expects the U.S. Department of Transportation to decide later this year whether it should be granted immunity. There are investigations on both sides of the Atlantic into whether SkyTeam and Star Alliance should continue to receive immunity (see story, page 3). “For now, our approach is very much based on Businessflyer,” said Lemmens. “The rest will depend on the outcome of the antitrust immunity review.” Businessflyer is a discounted fares program available to companies without enough volume to negotiate a contract with a Oneworld carrier. It operates in Belgium, France, Germany, Italy, the Netherlands and Switzerland, all markets where the dominant carrier is not a Oneworld member. Most customers signed up to Businessflyer are small and midsize enterprises, but Lemmens said some are national branches of multinational corporations and others are companies that give the overwhelming majorBusiness Travel News ity of their business to the local dominant airline. This month, Oneworld announced that in 2008 it increased its Businessflyer customer base by 12 percent to almost 10,000, including a 50 percent rise in France. Sales of all types of Oneworld fares rose 25 percent to $850 million in 2008, compared with an overall increase in revenues for Oneworld members of 3.5 percent. Total Oneworld interline revenues rose by 10 percent to $2.4 billion, with interline passenger numbers also up 10 percent to 8 million. Oneworld claims that its members made a combined loss in 2008 of $1.7 billion, compared with losses of $8.8 billion for Star Alliance and $13.3 billion for SkyTeam. However, Oneworld does have fewer members than its two rivals. —Amon Cohen www.BTNonline.com Monday, June 29, 2009 21 http://www.btnonline.com/newsletter http://www.BTNonline.com

Table of Contents for the Digital Edition of Business Travel News - June 29, 2009

Business Travel News - June 29, 2009
Contents
Inside Track
BTN Research
Profiles In Travel Mgmt
Forum
Lodging
Aviation
Payment/Expense
Meetings Today
EuroBTN

Business Travel News - June 29, 2009