Ireland and the US are currently negotiating a "side" deal, which the Irish government hopes to "stitch into" the new EU/US Open Skies deal once it comes about. Trouble is, it's a bit of a stitch up, because it's not actually Open Skies and will mean access to Ireland is more restricted than to any other EU nation.

Hopefully the EU will be able to stamp out this little plan, but with Loyola now apparently digging her heels in for something the US is determined not to give, I'm just wondering when the EU will next be visiting Planet Reality.

Ireland wants the stopover to continue for another six years, albeit with a phased reduction in SNN flights from the current 1:1, to 2:1 (which would allow EI to add 3 more daily flights) and finally, to 3:1, after which the stopover would be done away with. The Americans say SNN has already had ten years to get used to the stopover being out of the way. Of course, the Irish govt has to play to the powerful SNN lobby, but it is also saying that it doesn't want SNN to have less traffic after the stopover goes than it does now. One would have thought that was down to the marketing prowess of the airport itself.

Lots of fun to come, but hopefully a deal can be done soon. Good to see Willie Walsh sticking up for EI in public as well; previous EI Chief Executives have always hidden under a bunker, for fearing of incurring governmental wrath, but WW clearly sees an advantage in sticking up for his company. Good on ya, W! :ok:

Is the EU a State or not a State in the international sense?


I know it is not a State in ICAO because I looked at the list but how can a State (like the US) have an agreement or treaty or whatever with something like the EU that is not a State?

If the EU is a State fine, then they get a vote and conclude treaties and agreements and the states that make up the EU don't make treaties or international agreements any mre than Nebraska or Ohio do. If they are not a State then they don't get a vote and don't make agreements or treaties.

I fail to understand how the EU can think they can negotiate air treaties as a whole when at the UN each country has its own delegation and vote. Perhaps when they speak and vote as a whole at the UN, maybe the US will take the EU more seriously as a whole when negotiating air treaties.
Meanwhile back to the subject of openskies.If by chance somehow the US met all the demands of the UK--allowed cabotage in the US, foreign ownership levels raised to 51% and met all other demands, where would all the slots , gate space etc. etc.come from to allow all US carriers openaccess to LHR? The UK and BA steadfastly maintain that there are no available slots and/or facilities at LHR for expansion of US carriers.So if there are no slots and facilities available at any cost, why should the US meet the demands and wishes of Ba and the UK?

Is EU a state or is it not a state ? Never mind - the US takes 350 mil. potential euopean customers very serious and consequently the US will talk to the EU. Come to think of it: they are talking....

BTW: You may read this thread from the very beginning.

Very simple. The EU member states delegate powers to the EU over some fields of policy. Trade (and that includes open skies) is one of 'em. Clear enough? Imagine, if you will, Germany trying to negotiate preferential tariffs with New Hampshire. Doesn't work. Same principle.

So it is all EU or nothing. No side agreements with Ireland or whatever, eh. The last agreement I saw between the US and the "EU" had all the countries names on it too and it was definately on trade. At ICAO the EU is an observer organization and has no vote. Bottom line is the EU is a organization that is still being born and growing up to acquire attributes of a state. When it does acquire these attributes it can use them and there will be no more vote for France, Germany, UK, etc, just one EU vote.

As a trade or economic or customs block or union the EU is substantial sized and a factor in global aviation but should not think it has such tremendous leverage that it can make the rest of the world do things that are not in their interest. Why the US should allow cabotage and essentially free access to the US market to EU airlines is beyond me. It is not in the interest of the US to do this if the trade is access to the EU market on the same basis. EU is big but not that big and not that attractive. Air transportation is needed by many more people in the US because the US is a lot bigger geographicly and does not have the passenger rail network Europe does, so the proportion of people in the US that travel by air is much greater than in Europe, so a Euro bellybutton is not as attractive as a US bellybutton (economically, that is...have seen some amazingly attractive Euro bellybuttons)


Maybe it is also time to get rid of thequaint notion that airlines or any other corporation is a national of any particular state except to need someplace to be incorporated. Most all airlines I can think of are not particularly loyal to a State except for the cash, preferential treatment or subsidies that can be extracted. Owners of corporations really don't care about anything but making money in most situations, and what they are doing in the airline business if that is their goal is beyond me. MAybe it is just a ego trip.

total population on 1 January 2004
(millions) 454.9

usa 291

bigger than youse :D (well more of us anyway)

Iron City wrote:
...and somehow you've arrived at the conclusion that traffic rights are not a trade issue ?

The Financial Times reports that:

'Leaders of the European aviation industry are seeking an urgent meeting with Loyola de Palacio, the European transport commissioner, after complaining that the Commission failed to inform them about crucial recent developments in negotiations over liberalising air services between the US and the European Union....'

The same source also has a very interesting article (subscription required) about EU air transport policy. Key points are:

'The aim of the [EU-US] talks is to sign a comprehensive agreement that could dismantle the ownership restrictions still prevalent on both sides of the Atlantic. It could include provisions allowing US carriers to fly between European cities, and vice versa, a practice that is still banned. It could, in the end, ease the way for transatlantic mergers to go ahead...'

'In any case, the talks have already increased the likelihood of European mergers, witness the tie-up between KLM of the Netherlands and Air France.'

ATWonline has something on that meeting too.
Must say that I'm not feeling comfortable with Sra. Loyola...

EU transport ministers to mull OAA proposal, Heathrow access
Loyola de Palacio "developing her position"
European industry ask the Council not to endorse the agreement
ATWonline

Personally, I hope a deal can be put together, even if it doesn't include LHR.

The main sticking points appear to be:
- LHR access, which is admittedly a big issue
- Ownership; I believe the Americans are prepared to go up to 49%, a major concession, and
- Cabotage; the Europeans got a much better than anyone might have expected. That's as good as it's going to get: go with it.

Look at what European carriers are getting: unrestricted t/a access between Europe and the US (excluding LHR). It really is a major leap forward. What are the European carriers - and how many of them - objecting to?

From an Irish perspective, our own government is acting up over SNN again (although I suspect that much of that is drum beating ahead of the Euro elections), so as soon as the deal can be done, we get increased access and the SNN stop gets phased out, hopefully very quickly.

Time the deed was done!

Unfortunately, the deal was rejected today. However, Loyola at least is still holding out hope for a deal within the next two weeks. The main sticking point appears to be US domestic access and of course, Heathrow. Personally I'm surprised that they've got as far as they've got on this, but hopefully they will be able to work a deal. Since the major obstacle is something primarily involving the UK, perhaps GB and TB can talk about it while they're in the US.

Perhaps some of the extra slots arising from the move to mixed mode operations will be allocated to new US carriers? I really don't see how much farther the Americans can go; there's no way they will get cabotage approved in an election year. Were it not for the fact that the Americans are anxious to get increased LHR access, I wouldn't be surprised if they told the Europeans to get stuffed.

What is frustrating is that the prospect of increased access only appeals to a small number of major carriers, so progress for the rest is being obstructed for one or two.

There is such intense frustration in the US over the LHR issue that I believe there might be serious consideration given to renouncing Berrmuda II.
This is an election year in the US and there might be some political gain for Bush for doing so.
At one time I thought political pressure might help reslove this issue. The close relationship between Thatcher and Reagan, Clinton and Blair and now Bush and Blair all have not helped on this issue. It is time for the US to get tough--very tough.
Surely the EU must know that they will never get a better deal from Kerry.

Well, I can assure you that there is also intense frustration in Europe about the complete asymmetry of treatment of US airlines - the fact that post 9/11 they have been given major subsidies to keep them going when European airlines have had to keep their own houses in order or go out of business - the fact that they expected subsidised fuel if the price increased. Have they never heard of "risk"??!!! The fact that they expect to be able to displace the slots of existing operators at LHR, that they expect to have the right to operate where they choose across Europe when European airlines have limited right of access into the US, let alone inside the US. The fact that the rules are such that European operators have to be basically owned by Americans to allow free access to the US market place. The fact that they can dictate operating conditions to airlines from other nations that are way beyond what local regulatory authorities normally do (flight deck doors [OK, so that was probably for the best] - and the stuff about not allowing queues for toilets - good grief!!!) when their own security systems are clearly not as good as those in some other countries who had to jump when they said. And finally, the fact that once they get what they want, they will simply lose interest in any further negotiations - look at the blatantly unfair situation regarding protected industries and tariffs in other areas. So as far as I'm concerned, by all means negotiate, but get it right first time, because if the US gets what it wants the first time, there won't be a second time.

http://www.continental.com/vendors/d...59&s=&i=PRNews

If you look at this quote from the news release above.

"Airlines like Continental must be given slots at Heathrow to stem the tide of British Airways' domination."

You can see that the American Carriers' arguments are totally irrational, how would Continental feel if BA released a statement saying that an American carrier at an American airport mustn't be the dominant airline and should yield power to a foreign airline.

Heathrow is a British airport, it will always be dominanted by a British airline, just as much as Continental has the right to be the dominate airline at EWR and IAH.

I think CO, NW and DL should have the rights to fly to Heathrow but the British Government should insure that BA does not have to yield the slots to them.

So, we're left with the (very predictable) situation whereby access to Heathrow is the stumbling block. The Americans are expected to give access to their domestic routes, which is simply not a runner, in an election year of all years and - please correct me if I'm wrong - everyone else is held up until LHR is sorted out.

The sides appeared to have been close together a few weeks back, but we now seem to be back at Square One. This makes it extremely unlikely that a deal can be done by the 25th June, as was hoped for; hopefully, individual governments can reach some deals, but the Americans are thought to feel that negotiations with the EU as a unit is better than negotiations with every side.

My understanding, originally, was that we were aiming for a situation where all European and all US carriers could fly between any two points in each region, i.e. unlimited transatlantic flights. While I understand that LHR access is a sticking point, surely this is something the US and UK governments could hammer out between themselves, or will the deal on LHR be expected to allow all European carriers to fly from LHR? Surely there is some way this obstacle, which has long been anticipated, can be separated?

It would appear this is going nowhere fast-

LUXEMBOURG (Reuters) -- European Union transport ministers have rejected a U.S. offer for a landmark aviation agreement and want further negotiations, said the European Transport Commissioner Loyola de Palacio.

Further talks on an "open skies" pact would focus on gaining more access for EU carriers to the U.S. domestic market.

"We are going to continue negotiations to try and improve the current situation," de Palacio told reporters.

She said the EU would try to win more concessions on the market access issue before an EU-U.S. summit later this month.

U.S. Transportation Secretary Norman Mineta said in a statement he was disappointed by the decision, calling it a missed opportunity to open access to each others' markets.

"We remain committed to opening up transatlantic aviation markets," he said in a statement. "However, given today's unfortunate decision, we must now review how best to achieve the objective."

Talks between the EU, now 25 nations strong, and the United States began after an EU court ruled that U.S. bilateral agreements with individual EU states broke European rules that create a single internal market for the bloc.

The United States has agreed to let EU investors own up to 49 percent voting stock in a U.S. carrier, up from 25 percent. But it balked at allowing European carriers to fly U.S. domestic routes, known as "cabotage."

Under current bilateral agreements with individual EU countries, U.S. airlines have this right in some cases. De Palacio said this created an "imbalance" in the market.

Part of the agreement as it currently stands addresses this problem. For example, EU carriers would be allowed to charter U.S. aircraft or space on U.S. aircraft for domestic flights, provided the flight was ultimately operated by a U.S. carrier.

"This is considered not enough," she said.

Britain crucial
Nonetheless, European Commission officials have said the United States was unlikely to grant domestic flying rights anytime soon.

Ludolf van Hasselt, head of the EU executive's air transport policy unit, said this week that cabotage was a non-starter for U.S. negotiators and waiting for a potential change in administrations would not strengthen the EU's hand.

Britain, crucial to any EU open skies deal because of its large share of the transatlantic market and because U.S. carriers are anxious to gain more access to London's Heathrow airport, has said it would not support an agreement without better access to the U.S. domestic market.

"We are not going to make a deal with the Americans without the United Kingdom on board," Commission spokesman Amador Sanchez Rico said.

De Palacio said ministers from other nations were more supportive.

A UK spokeswoman said Britain did not see a summit later this month as a necessary deadline for an open skies agreement.

De Palacio said she was determined to reach a deal but added: "It's going to be very difficult." She said the current situation, in which 15 EU nations have bilateral agreements that do not comply with European rules, was "not sustainable."

She also said she had the impression that European airlines were getting cold feet about an accord.

European aviation lobbying groups oppose a quick deal that does not free up the U.S. market.

Current proposals would give European carriers the right to fly to U.S. destinations from any EU member state, easing the way for possible EU airline mergers in the future.

"She also said she had the impression that European airlines were getting cold feet about an accord."

Reading the above entire article again gave me some new insight.
The other Eoropean airlines getting cold feet at a deal tells me that KL,AF,LH etc. are afraid of opening up LHR and BA possibly getting US anti trust immunity for Oneworld.
As things stand now KL,AF,LH etc. etc. etc. all have open skies and US anti trust immunity and thus have a very strong advantage vs. BA and Oneworld. So it is not to their real advantage for there to be a US/EU openskies now or ever.
At least thats the way I see it.

Air traffic rights are of course a trade issue of the first order.

The best I could do in finding european statistics to make my point (seems the published stuff I could find is all differences from previous year or sliced in various ways) was an undated paper (presume it is 1999) titled "The European airline Industry: From Single Market to World-Wide Challenges" on the EU web site (europa.eu.int/comm/transport/ais/rules/doc/com.1999 182en.pdf) Table on page 9 states:

Europe Domestic market % of world RPK 7.76%
North America Domestic Market % of world RPK 24.42%

Youse got more bellybuttons but don't fly as much

If anyone in Europe thinks the U.S. is going to give free access to the U.S. domestic market to foreign airlines they are very, very mistaken.

I think you're right, but equally if anyone thinks that the UK/EU are going to permit Uncle Sams state-subsidised hordes to descend on LHR and wipe out the home market of the UKs longhaul carriers in return for the right to fly unrestricted , unprofitable point-to-point routes to the US then they are just as mistaken.

its such a relieve, despite some of the previous posts, to understand that "Shannon and the Irish Goverment" are not the "one and only" ingredient threatening to bring these negotiations to a stumbling halt!!! :p :p :p

Despite Hobie's inexplicable ;) doubts about the gravity of the Shannon stop, I'll pass over that and focus on what baffles me about the current position.

Originally, we started with the idea that any airline from either the US or EU could fly transatlantic between any two points. Now I know LHR is a big issue, but I don't think cabotage is on the table; indeed, I'm surprised (a) that the Americans have granted as much as they've granted and (b) worse still, that the Europeans should even want to fly domestically in the US. I mean, the fight against low costs is not much different in the US than it is here; the big airlines are being hit left, right and centre by low cost carriers like Air Tran, Spirit, JetBlue and that lot from Texas. If European carriers were to be thick enough to wade through all the formalities of getting into the US, they'd be setting up a full service airline, marketing to get their names better known and then, the low cost carriers, which can move a lot faster than the big boys, would cut the two feet from under them. Why would they possibly WANT to do this? Wouldn't they be far better advised to focus on the fight they're currently involved in, rather than opening up a new front?

So, this raises a question about what the hell Loyola and the Brussels lot are playing at? Yes, US carriers want more access to LHR; yes, it's slot restricted, but if they want this, why not trade like for like; give bmi its coveted routes, allow access to more US cities from LHR (such as those like DFW, CVG, ATL and IAH currently only served from LGW) and focus on transatlantic flying. The second biggest tragedy of this silliness is that the chance of building the world's biggest open aviation area is being impeded by something that even if won, may never be used. The biggest tragedy would be that some airline might actually use and lose thousands of jobs and have to shut down as a result. So, stop arsing around and get the deal done.

Iron City
 

So if I understand you correctly, and since the EU should be treated as one big "domestic" market, then N-reg. UPS and FedEx aircraft will be barred from performing the sort of flying that they currently do? Don't have a problem with that ....

So the logical answer is to cancel all outstanding intra-EU traffic rights enjoyed by any US entity (ie UPS, FEDEX, etc...).

Wonder whether the EU powers-that-be have the cojones for that??

Been absent for a while, but good thread.

A few points to ponder:

How many major airports in the US are served by BA? How many major airports are served in the UK by a single US airline?

I think BA serves 11 airports in the US, where as I think AA serves three or four in the UK, with UAL even less. VA probably serves more destinations in the US than any US carrier does in UK.

There is one airport in the UK that all US airlines wish to go to, LHR. How about we restrict VA, BA and BMI to one major US airport!

The RPK's generated by less people in the US is larger than more people in the EU. There is just more flying in the US than anywhere in the world.

The US airlines are not really the ones psuhing for open skies, they have litle to gain, call it protectionism if that makes you feel better, but it is just the way it is. We do not prohibit EU airlines from serving the US, we just wish to get something in return and there is not much being offered, since the US have the largest market. Someone said that BA should not be forced to give up slots at LHR, well, cannot have your cake and eat it too, but that is what it appears to be the EU wants.

Yes, some airlines were subsidized as a result of 9/11. Most EU airlines, through the times, have been state subsidized because of poor economics, a few still are, so lets just call that an even draw. Heck, BA certainly gained from being state owned.

So I ask all my friends from across the pond: "How would open skies be a benefit to US airlines and perhaps more importantly, why are the EU airlines so keen on geting it?

Again missing the point that the EU is a single market. How many EU cities do Delta/ United et al fly to?

Perhaps no-one in America knows that there is anywhere else in the UK but London. Ya'll know, Buckingham Castle in Londonshire?

Diesel8 - your post misses the point in all sorts of ways. Firstly, bmi have the slots at LHR but currently can't fly to anywhere in the US from there - the right for them to fly to one airport would be an improvement.

Next, to the best of my knowledge, there are no restrictions on US carriers operating to anywhere in the UK with the exception of LHR - so if they want to fly to Bristol, Blackpool or Biggin Hill, then they can.

Next, in trade terms, we aren't comparing UK with US, we are comparing EU with US. And whilst AA may only fly to three or four destinations in the UK, they fly to considerably more than that in the EU.

Next, you can't call it a draw when there are definite losers. There are private companies in Europe who have never had subsidies, and never sought them. You are saying that the huge US airlines - privately owned! - ought to be compared to the inefficient products of bureaucracy that are the state airlines in the EU? Privately owned airlines in the EU either survive or disappear - and there have been more than a few that have tried to get into the US market that haven't managed it. bmi is only the latest. Privately owned airlines in the US get state subsidies when they can't turn a profit - and if that isn't enough, then they stop paying their creditors for as long as it takes to sort out their finances again.

In the real world of finance, rather than the protected world that is the US (and secondarily, the restricted world that is Bermuda II), UA would have had to sell assets to survive bankruptcy - in a much more compact shape than before - and some of its best assets are its slots at LHR, which held their value. That would have allowed airlines who thought they could make a go of it to buy them and do something with them. In the real, demand-led world of economics, rather than the supply-led regime that exists at LHR and through Bermuda II, airlines would have to set fares to compete with each other - which would make access to LHR a lot less desirable, anyway - it is only because there is a restricted marketplace that the London-US routes are so lucrative - with business class fares typically 50% higher than comparable unrestricted routes elsewhere in Europe, and oddly enough, almost the same for the four airlines that operate on the routes (according to old British Midland press release).

First off, the thought that americans have no clue about EU land is getting a bit tiresome and secondly, I was born and raised over there.

Yes, Delta et al serves a decent amount of EU destinations. However, due to travel patterns, for every one destination a US carrier serves in europe, that corresponding country's carrier serves 2-4 in the US. Case in point, SAS serves three US destinations, where as no US carrier serves Copnhagen. Not because of lack of access, at least that I know of, but lack of passengers. I know, that UAL, a member of the star alliance, wanted to serve CPH from Dulles, but apparently that was opposed strongly by SAS. SAS of course being a partnership
of Denmark, Norway and Sweden.

The point here being, that while many US carriers do have atlantic flights, it is not the lifeblood of the airlines, the domestic US market is more important.

LHR is not the only airport in the UK, but I think we can agree, that it is the most desireable in terms of getting access. As we have seen, it does command a fare premium. So, one could say, that not getting meaningful access, would indeed be a advantage to BA. Not only on the atlantic portion, but even domestically.

Carnage says:"I think you're right, but equally if anyone thinks that the UK/EU are going to permit Uncle Sams state-subsidised hordes to descend on LHR and wipe out the home market of the UKs longhaul carriers in return for the right to fly unrestricted , unprofitable point-to-point routes to the US then they are just as mistaken."

As far as state subsidies goes, I am curious what US airlines we are talking about and whether we are talking post 9/11? The US is not in the habit of subsidizing airlines, owning them or having shares in them. The list of airlines in the EU that recently have been or still is subsidized, owned or in part held by the repsective goverment is rather long. So, while I do not think UAL should be granted a loan guarantee, I also feel that vis a vis EU airlines, that it is a moot point and in the case of the vast majority of US carriers, it was a direct result of 9/11, not an ongoing thing.

So my question is again, why should the US airlines push for open skies? What advantages would they gain? It is notable, that the big push is coming from EU airlines, not the US ones, so something tells me, that companies like BA sees an advantage, where as DAL does not.

BA wants the status quo. That is why they are pushing so hard for a "comprehensive" agreement - meaning complete, meaning unachievable - to kick the ball out of touch for as long as possible. This means they can continue to use their restricted access to LHR to keep fares high. Incidentally, suppose there was much more access to LHR - what do you think would happen? My guess is that airlines would stop making money on business routes to the US, and the number of connections at LHR (which is what make it so attractive to business travellers in the first place - let's face it, it has few other redeeming features!) would fall.

With regard to UA, who do you think is the dominant airline in Star? I'll give you a clue, it's not SAS.

"However, due to travel patterns, for every one destination a US carrier serves in europe, that corresponding country's carrier serves 2-4 in the US. Case in point, SAS serves three US destinations, where as no US carrier serves Copnhagen"

These two sentences are meaningless. Do you mean, "If a US airline flies to city XXX, then the flag carrier that is based in city XXX will fly to 2-4 US cities"? I think that's kind of what you mean. If so, this says nothing about the level-ness of playing fields or otherwise. I mean, it wouldn't surprise me if the reverse applies as well - "If a EU airline flies to city YYY in the US, then a US airline will fly from there to 2-4 EU cities."

I know that people in the States have got used to justifying anything by reference to 9/11 - but why should US airlines have received subsidies as a result? Before you answer that, bear in mind that European airlines generally don't receive subsidies now - certainly nothing like the billions of dollars that were thrown at US carriers in the last couple of years - and didn't as a result of 9/11. There are countries who have lost their flag carriers since then whilst all the dinosaur US carriers - not flag carriers, just businesses exploiting their dominant market position and fortuitous location - are still lumbering along.

"Lack of passengers" - low cost airlines make their own passengers! Or do you think that we - or the federal government - should pay US airlines to operate on more routes that they can't make profitable?

"The French state injected about 20 billion francs (3.05 billion euros, 3.54 billion dollars) in Air France subsidies between 1994 and 1997."

"The recent reported statement by the chairman of Alitalia claiming that government help is needed to prevent the bankruptcy of the Italian flag carrier." (Again??)

"1996, under the eagle eye of Commissioner Kinnock, Iberia received state aid of £460 million and that was approved under the market economy investor principle. We shall see how that works out. In other words, the flag carriers of six European Union member states out of 15 have between them received £6.364 billion of state aid over the past five years. Forty per cent. of EU states have received that grotesquely large amount of state subsidy--and some, such as Air France and Iberia, have repeatedly come back for more."

"On Wednesday, Ms de Palacio announced a limited package that would allow European governments to help airlines, after the 11 September attacks pushed the crisis-bound industry into turmoil."

Should I go on?

Yes, that sentence came out a bit backwards. What I meant by travelpatterns, is that a lot more europeans travel to the states than vice versa. People in the US seem to fly more domestically. While that is certainly no ones fault, that is just how it is and as such, I cannot see why open skies would be advantageous to US airlines, just like opening LHR would be disadvantageous to BA.

SAS, can because of their network, profitably serve the US, but only by pulling people from all over Scandiland and to a limited extent EU. But, in the reverse, no US carrier serves CPH, because there simply is not enough americans going there. Sure, a american carrier could, after open skies, set up the same network, but I doubt it will happen, since US carriers are more concerned about domestic ops.

(In case of Star, from what I can see, Lufty and UAL are the big dogs)

As much as this pain you, there are a lot more people wanting to visit the states, than visit EU. Europeans tend to travel on EU airlines and to a limited extent, prefer their own national brand.

Again I must ask, because I never get an answer, why should US airlines push for open skies? The fact that I canot seem to get a response to that, tells me, that EU airlines has lots to gain and US most to lose.

Young paul

Tell me European airlines of comperable size to PANAM, EASTERN, MIDWAY, TWA and BRANIFF that are not in existance in a similar time frame?

European airlines are FAR more subsidized than US airlines that have to pay health insurance and retirement costs for their employees far above what a European airline would have to pay because of the Nanny state.

Then of course you have the direct cash gifts to European airlines that DWARFS anything that goes on in America

Deisel 8, You forgot Olympic airways. Just got another round of grants.


Cheers
Wino

I think you'll find my employer pays an awful lot of pension and National Insurance contributions for me, not to mention private healthcare. Wouldn't want to live on the $100 per week state pension now.

Diesel8s quotations on EU subsidies are rather disingenuous. AF had susbsisdies ending in 1997. Iberia got the cash in 1996. Alitalia are banging the begging bowl but the Italian government has repeatedly said no. Olympic haven't had any cash for a long while. The quote about 40% of EU states paying subsidies is undated.

What is clear is that since 2001 the US carriers have received billions of dollars in direct subsidy from the ATSB, plus free security enhancements (flight deck doors for example), Chapter 11 protection and still they appeal for assistance because of the high price of oil. Since 2001 AFAIK no European airline has received any state subsidy. Somebody mentioned that more Europeans visit the USA than vice versa and they prefer their own national carriers. Well if thats the case then why are US government permitting the subsidies to be spent on international routes? By all means take the cash if thats what it takes to maintain an essential domestic air network, but using it to compete with unsubsidised airlines on your loss making international routes is nothing other than pure protectionism.

Second that about the cost of employment in the EU. Do you know how much the "nanny state" costs??!! I do payroll for 2 people, and the cost of employing them is as much as a third person.

Are there any comparisons showing that the EU airlines are competitive with the US airlines as far as operating costs are concerned? Would the inter-US market be profitable for foreign carriers?

I'm sure there are comparisons available, but I think the key issue is that European carriers have enough on their plate trying to fend off the likes of FR, EZY, etc., without opening up a new front. It's not the "majors" they need to worry about; it's the likes of Southwest, Jetblue, Airtran, etc, which are not only a lot more efficient, but can move a lot faster. So, the danger is that a European carrier could go to all the trouble of setting themselves up, marketing etc, only for a low cost like Southwest to come in and make mincemeat of them. And where would they base themselves? A major city, to which they fly internationally, which isn't already a hub of a major carrier or which isn't coveted by a low cost carrier. Let me know if you find one!!

To cut to the chase; winning this concession would only be equalled as a disaster by some European carrier actually using it.

I was just wondering if anyone had heard any progress on this; is it completely impossible that a deal might be done in time for this weekend's summit in Ireland?

I read this week (can't remember if it was Airwise or ATW news) that there was a dispute between various EU members (possibly along the lines of the EU constitution talks this weekend), where the Germans and others were objecting to having to wait for the LHR issue to be sorted out.

What's most frustrating is that everyone knew that the LHR issue would be a fraught and incredibly difficult one to deal with; I still don't understand why cabotage has to be brought into it; a third UK airline wants to fly to the US and more US airlines want to fly to LHR; can't they just agree two allow one from each country and a progressive growth in the number of cities served and frequencies. This could go on for years otherwise, holding everyone else up.

quote

"From an Irish perspective, our own government is acting up over SNN again (although I suspect that much of that is drum beating ahead of the Euro elections), so as soon as the deal can be done, we get increased access and the SNN stop gets phased out, hopefully very quickly."

and

"I was just wondering if anyone had heard any progress on this; is it completely impossible that a deal might be done in time for this weekend's summit in Ireland? "

don't know if this is a good sign or a bad sign for SNN but guess where the Summit meeting between President Bush and the EU leaders is to be held? ...... yes!!!! ... Shannon !!!!

It is a cruel (but much deserved - and even more enjoyable ) irony that the deal, if it is done, to end the SNN stop could be signed a mere 8 miles from Shannon itself!

Unfortunately, there's been very little news, apart from reports of a split between various European countries. It seems absurd that LHR is still the sticking point and that it's holding everyone else up. My hope, however forlorn, is that the EU and US are working feverishly together to cobble a deal together in time for the Summit. At the very least, I hope a mini deal can be done, excluding LHR.

It is a cruel (but much deserved - and even more enjoyable) irony that the deal, if it is done, to end the SNN stop could be signed a mere 8 miles from Shannon itself ! I didn\'t miss that irony!

Unfortunately, there\'s been very little news, apart from reports of a split between various European countries. It seems absurd that LHR is still the sticking point and that it\'s holding everyone else up. My hope, however forlorn, is that the EU and US are working feverishly together to cobble a deal together in time for the Summit. At the very least, I hope a mini deal can be done, excluding LHR.