Open skies – airline deregulation

Airline deregulation is about to make those weekend trips to Paris a lot easier and cheaper, says Reason. Under the "Open Skies" agreement, which went into effect at the end of March, any airline – American or European – can now fly to any airport on either side of the Atlantic.

  • Previously, the takeoff and landing points for transatlantic flights were covered by a complex series of bilateral agreements between the United States and each of the destination countries in Europe.

  • Now, thanks to the "Open Skies" agreement, carriers will be able to choose the routes they think people will want to fly and make arrangements as they see fit.

    The hottest property so far is London's Heathrow airport, which used to be restricted to only United and American Airlines flights from the United States. Before the end of this year, additional carriers will offer direct flights from Detroit, Minneapolis, Seattle, Atlanta, Dallas-Fort Worth, Raleigh-Durham and Los Angeles.

    Jerry Chandler, the writer of a popular travel blog, says deregulation could lead to the flourishing of routes in markets that currently don't exist, especially from smaller U.S. cities to European hubs.

    Michael O'Leary, the chief executive of the Irish carrier Ryanair, says flights from secondary European cities to secondary U.S. cities are on the cards, perhaps for as little as $16 (R115).

    Source: Katherine Mangu-Ward, Open Skies, Reason, July 2008.

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    For more on Regulatory Issues:

    FMF Policy Bulletin/ 29 July 2008
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