US setback for BA-American Airlines alliance


The US Justice Department is refusing to back an alliance between British Airways (BA) and American Airlines unless the two quit flight slots at Heathrow.

British Airways has said the call is "inappropriate".

The Justice Department wants the firms to relinquish 63 of their weekly take-off and landing slots. The recommendation from the department comes after it was asked its opinion on the proposed alliance between the two airlines, which was first proposed in August.

Under the planned tie-up the two would code-share and give passengers single-ticket access to each other's destinations. They would also agree fares, meaning over 50 per cent of all transatlantic flights would effectively be with the alliance.

The two airlines asked to be given permission to agree fares and timetables without the threat of prosecution under US anti-trust laws.

In return, they have backed an "open skies" policy that would give free access to Heathrow for any US carrier, a goal the US Department of Transportation (DOT) has sought in the past. The DOT is due to decide on whether it will give the deal the go-ahead in the new year.

A spokesman for British Airways said it and American Airlines would be filing more papers with the DOT to follow the Department of Justice's advice.