International Aviation:

DOT's Efforts to Increase U.S. Airlines' Access to International Markets

T-RCED-96-32: Published: Mar 14, 1996. Publicly Released: Mar 14, 1996.

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GAO discussed the Department of Transportation's (DOT) efforts to increase U.S. airlines' access to the United Kingdom (UK). GAO noted that: (1) DOT has little leverage in its efforts to reduce restrictions in its agreement with the UK, since its major airline already has extensive access to the U.S. aviation market; (2) only two U.S. airlines have access to London's Heathrow Airport, with the other U.S. airlines forced to use London's Gatwick Airport, which is farther from downtown London and offers fewer connection possibilities; (3) to increase U.S. airline access, DOT gave the major UK airline additional flights, approval to code-share to additional U.S. cities, and the right to offer for U.S. government personnel travel services between the United Kingdom and several U.S. cities; (4) DOT rejected a British offer that would have increased U.S. airline access because of the numerous conditions and restrictions imposed and the deeply divided and competing interests of U.S. airlines; (5) some DOT bargaining chips, such as relaxing statutory limitations of foreign investment, increasing foreign airlines' access to government personnel travel services, or granting antitrust immunity, involve important tradeoffs that could affect competition, national security, and employment; and (6) DOT has responded positively to GAO recommendations to collect and analyze information on U.S. airlines' overseas business so that it can perform adequate economic analysis of the industry and proposed agreements.

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