Virgin boss criticises US support for BA and American Airlines tie-up

British Airways’ plan to join forces with American Airlines has met with initial approval from the US Department of Transportation (DoT), to the outrage of Virgin Atlantic boss Sir Richard Branson.

The DoT has found that granting anti-trust immunity to the two companies and three of their partners, including British Airway’s intended merger partner Iberia, would enhance competition with the Star Alliance and SkyTeam alliance.

It would also “provide travellers and shippers with a variety of benefits, including lower fares on more routes, increased services, better schedules and reduced travel and connection times.”

The DoT has made approval conditional on four pairs of take-off and landing slots at Heathrow being made available to competitors, and has invited interested parties to show cause within 45 days why the proposed decision should not be made final.

Rival Virgin Atlantic boss Sir Richard Branson blasted the decision yesterday, saying it was a “real kick in the teeth for consumers”.

“The US Department of Justice, who are the experts in competition issues, called for strict remedies to protect the public interest, because the alliance will harm competitions and the consumer.”

A British Airways spokesman said: “British Airways, American Airlines and Iberia plan to operate a joint business between North America and Europe. ”

As verified by the DoT today, their closer cooperation, made possible by anti-trust immunity, will benefit customers with more travel choices and convenient schedules, expanded opportunities to earn and redeem frequent flyer miles, and greater availability of lower fares.”

Source – The Telegraph 2010

Don’t forget your cheap holiday insurance!
You can purchase great value holiday insurance direct at 24/7 travel insurance. For 8-days insurance cover for the USA, it will cost you only £25.52* – a small price to pay so you can enjoy your holiday all the more!

*Premium £25.52 includes Insurance Premium Tax based on an adult aged under 55 taking out a “Standard” Single-trip 24/7 travel insurance policy for 8-days travel insurance cover for the USA excluding personal possessions cover and purchased within 14 days of departure date. Cover details and prices are correct at time of going to press (February 2010) and are subject to change.