Air France in talks with American
US airline reopens negotiations with continental counterpart in case BA deal is blocked
Sunday 25 August 1996
But an Air France spokesman confirmed that the two airlines were talking again. "We are in discussions with a number of US carriers about an alliance, including American," she said.
The talks are thought at this stage to be tentative, given American's commitment to its alliance with BA. However, they confirm the seriousness of the US carrier's threat to seek a continental partner if the BA deal is blocked. "If the alliance with BA is stopped on either side of the Atlantic, then we will go across the Channel immediately and our first port of call will be Air France," an American spokesman said.
American's negotiations with Air France earlier this year were described by one insider as "having gone right down to the wire". The talks were halted just two weeks before American announced its partnership plans with BA.
The talks centred on a number of initiatives, including code sharing, joint marketing and consolidation of frequent flyer programmes.
The negotiations were not terminated because of any difficulties between the two sides but because American regarded BA as a better fit for its alliance ambitions.
If the BA deal collapses, however, American is determined to secure a partnership with a continental airline as part of its long-term strategic development.
Air France has been encouraged to revive discussions because of the opposition to the American/BA alliance on both sides of the Atlantic. The deal has been criticised by both British and US carriers, and it is also being scrutinised by competition authorities in both countries.
The Office of Fair Trading will shortly pass its recommendation on the proposed deal to Ian Lang, the President of the Board of Trade. He must then decide whether or not to refer it to the Monopolies and Mergers Commission.
BA has argued that the deal should be cleared and has pointed out that the alliance is important if the airline is to continue to fight off the mounting competition, particularly from Europe. Although American and BA would account for 60 per cent of UK-US flights, BA has argued that it is more important to view the alliance in a European context.
It will point to Air France's interest in working with American as confirmation of its argument that if its planned alliance is blocked it will hand an opportunity to its continental competitors.
Yesterday BA had no comment to make on the Air France/American talks, other than to say they were a matter for the two airlines involved.
Further doubt was cast on the American/BA alliance last week, when it emerged that the British Government was taking a firm line with its US counterpart over a new open skies air agreement. The Government has indicated that it is not prepared to accept an agreement similar to the one the US negotiated with Germany earlier this year.
The US has insisted on a new agreement before it will approve American's deal with BA.
Opposition to the deal from USAir, in which BA has a 24 per cent stake, also intensified last week. It applied to fly in direct competition on four transatlantic routes currently served by BA under the code-share agreement between the two airlines.
- 1 BBC told new political editor must be 'impartial' with Nick Robinson reportedly stepping down
- 2 Number of young homeless people in Britain is 'more than three times the official figures'
- 3 The map showing the most dangerous tourist destinations in Europe, according to the Foreign Office
- 4 The biggest first date turnoff has been revealed
- 5 German man found living with 300 rats in tiny apartment
BBC told new political editor must be 'impartial' with Nick Robinson reportedly stepping down
Humans of New York image of crying gay teen receives best response yet from Ellen DeGeneres
Isis propaganda video shows 25 Syrian soldiers executed by teenage militants in Palmyra
Number of young homeless people in Britain is 'more than three times the official figures'
Budget 2015: George Osborne to axe subsidies for higher income earners in social housing
More Britons believe that multiculturalism makes the country worse - not better, says poll
Nathan Collier: Montana man inspired by same-sex marriage ruling requests right to wed two wives
Greece crisis: IMF was pushed around by Angela Merkel and Nicholas Sarkozy – and now it is being humiliated
'I wish the BBC would stop calling it Islamic State' – David Cameron unleashes frustration at broadcaster
Forget little green men – aliens will look like humans, says Cambridge University evolution expert
Girl, 7, stares down hate preacher at Ohio festival with pro-LGBT rainbow flag gesture
iJobs Money & Business
£15000 - £17000 per annum: Recruitment Genius: This company offers a range of ...
£15000 - £16000 per annum: Recruitment Genius: Customer Service Advisors are r...
£20000 - £25000 per annum + OTE £45K: SThree: SThree were established in 1986....
£40000 - £60000 per annum: Recruitment Genius: A Compliance Manager is require...