AMR assails plan to curb access to Heathrow EC may require American, British ally to give up 350 slots at London airport


BRUSSELS, Belgium -- AMR Corp.'s American Airlines yesterday called "extraordinarily unfair" a European Commission plan to require it and British Airways PLC to give up 350 takeoff-and-landing slots at London's Heathrow Airport to win approval for their alliance.

AMR also suggested the accord could fall apart if European regulators insist on these terms.

"It is doubtful the alliance could be consummated under such onerous terms as these," said Chris Chiames, a spokesman for American, in response to a Financial Times report of the EC draft proposal.

EC officials declined comment on what restrictions the commission plans to impose on the American-British Airways planned alliance. The commission, the 15-member European Union's executive agency, is "miles away" from any final decision, said Sarah Lambert, a spokeswoman. "In its present form, the alliance isn't great for competition and a classical remedy for that is to give up slots."

The EC draft also seeks to require American and British Airways to reduce the frequency of their trans-Atlantic flights in some markets where they are dominant, the Financial Times said. Currently, the two have a virtual lock on London service from New York, Chicago and Miami.

"We would oppose that. Nothing even approaching such restrictions has even been suggested for other alliances that have much higher market shares in similar markets," said Chiames, American's spokesman.

The commission has said it won't rule on the proposed alliance until at least September, after its August vacation. Bob Ayling, British Airways' chief executive, has threatened to abandon the planned alliance if approval isn't forthcoming by November.

A British Airways spokesman said the airline hadn't been consulted by the commission.

A demand of 350 slots, equivalent to 25 daily round-trip flights each day, would be far more than the 168 weekly slots, or 12 daily round-trips, requested by the British Office of Fair Trading in a preliminary report last year.

Currently, British Airways and American control 3,352 weekly slots at Heathrow. The lion's share of slots belongs to British Airways. American paid Trans World Airlines more than $400 million for 112 weekly takeoff-and-landing slots in 1991; the carrier has since acquired an additional 70 weekly slots.

British Airways and American said last year they wanted to unite their trans-Atlantic fares, flights and marketing. The plan drew criticism from rivals and some consumer advocates who said the pair, which together control about 60 percent of U.S.-U.K. passenger traffic, would be too dominant.

Pub Date: 7/29/97

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