Commentary: Alternatives to Dan-Air
Wednesday 14 October 1992
Dan-Air's fate depends largely on whether Mr James, chairman of its parent company, Davies and Newman, can preserve his reputation as the company doctor who has never lost a patient and secure a rescue deal with British Airways. That, in turn, depends upon his coming up with a proposal that does not cause the competition authorities here and in Brussels too much angst.
To believe that he can do it requires a large number of assumptions. We are told that the Government, from Messrs Major and MacGregor down, is keen not to see Dan-Air fail.
It would cost 2,500 jobs and deal a savage blow to Gatwick as London's second hub. In any event, what would be so wrong in permitting BA to swallow up little Dan-Air when the relevant market is European and the competition global?
Well, there are several things wrong. First, the Government has never been overly concerned before about jobs when weighing up competition issues.
Second, BAA, the owner of Gatwick, is a privatised monopoly that should not need a leg-up from the state when life turns rough.
Third, the Government's multi-airline policy would be left ragged at the edges if it allowed Dan-Air to disappear inside BA's hangar.
Mr James and BA are playing a canny game in seeking prior assurances that any rescue package would not be opposed by the competition authorities. But there is no reason why they should succeed or, indeed, deserve to do so.
No one wants to see Dan-Air fail. But if it does there are other independent airlines capable of taking up its routes, thus preserving competition and retaining jobs.
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