Transportation:

Proposed Alliance Between American Airlines and British Airways Raises Competition Concerns and Public Interest Issues

GAO-02-293R: Published: Dec 21, 2001. Publicly Released: Jan 4, 2002.

Additional Materials:

Contact:

Jayetta Hecker
(202) 512-8984
contact@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

As part of their plan to form an international alliance, American Airlines (AA) and British Airways (BA) have sought immunity from antitrust laws in the United States and Europe. The extent to which the alliance might come to dominate the routes between major U.S. cities and London will depend on whether other airlines are able to enter this market under an open skies agreement. Some passengers may benefit from the larger network created by an AA/BA alliance, but GAO believes that the overall benefits of such an alliance may be limited for several reasons. First, continuing constraints in slots, gates, and terminal facilities at London's Heathrow Airport and BA's corporate strategy for reducing its overall capacity would limit potential benefits. Second, several carriers are already serving many of the markets that the AA/BA alliance plans to serve. Third, neither AA nor BA claim that the alliance would generate substantial operational savings that could be passed on to stockholders, employees, and customers. A full review of the competitive effects of this and other alliances is needed because GAO's analysis suggests that a grant of antitrust immunity could enable the alliance to enhance its market power on some routes. The United States and the United Kingdom may have different interests in expediting a bilateral open skies agreement and a decision on the alliance.

Nov 18, 2014

Oct 9, 2014

Sep 26, 2014

Sep 25, 2014

Sep 23, 2014

Sep 12, 2014

Jul 31, 2014

Jul 23, 2014

Jun 25, 2014

Looking for more? Browse all our products here