International Aviation:

Better Data on Code-Sharing Needed by DOT for Monitoring and Decisionmaking

T-RCED-95-170: Published: May 24, 1995. Publicly Released: May 24, 1995.

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GAO discussed international aviation issues, focusing on code-sharing alliances between U.S. and foreign airlines. GAO noted that: (1) bilateral agreements between the United States and foreign nations often restrict an airline's ability to serve foreign markets; (2) investments in other countries' airlines and the tripling of code-sharing alliances since 1982 have been effective strategies for airlines to gain greater access to international markets they did not previously serve because of bilateral restrictions or economic difficulties; (3) successful alliances can preclude other airlines from entering the market and can reduce the pressure on foreign nations to increase direct access for U.S. flights; (4) code-sharing will play a prominent role in bilateral negotiations in the future; (5) the Department of Transportation (DOT) could better assess code-sharing data by requiring U.S. airlines to identify which passengers traveled on code-share flights and foreign airlines to report data on their code-share traffic; and (6) DOT must improve its ability to quantify the value of direct access and code-sharing rights and analyze emerging trends in order to protect consumers' interests, ensure equitable treatment of competing U.S. airlines, and accommodate foreign airlines' desire to serve U.S. markets.

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