AMERICAN, BRITISH AIRWAYS CALL OFF ALLIANCE
American Airlines and British Airways cancelled an alliance that would have allowed both airlines to share routes. Both airlines declined an offer for antitrust immunity by the Department of Transportation (DOT), with conditions that would have included divestiture of 224 take-off and landing slots to competitors between the U.S. and Heathrow Airport.
“We will not do this deal at this price,” said Rod Eddington, British Airways’ chief executive, and Don Carty, chairman and chief executive of American Airlines, in a joint statement. “We made it clear from the start that we would not conclude the deal if the regulatory price was too high.”
DOT Secretary Norman Mineta said the terms set forth by the DOT and another governmental branch were established to protect consumers. “The conditions parallel those suggested by the U.S. Department of Justice and are intended to ensure that consumer interests and competition would be protected in the important North Atlantic aviation market,” he said.
Eddington and Carty cited the divestiture conditions as unrealistic. “For us, the price is just not right,” they said.
Mineta, in a statement, pledged to move forward. “We will continue working together with the United Kingdom to achieve our long-held mutual objective of open skies,” he said.