Bmi plans long-haul flights to India if 'open skies' talks fail

Bmi, Britain's second-largest full-service airline, is planning to launch long-haul services from Heathrow to India and South Africa if talks aimed at opening up the transatlantic market fail to make progress.

Bmi, Britain's second-largest full-service airline, is planning to launch long-haul services from Heathrow to India and South Africa if talks aimed at opening up the transatlantic market fail to make progress.

A last-ditch round of negotiations is due to take place next week between American and European Union officials that could see air services between Heathrow and the United States liberalised after a deadlock lasting more than six years.

The talks are the final opportunity for Brussels to strike an EU-wide "open skies" deal with the Bush administration before the US government closes down for the presidential elections in November. EU transport ministers are due to meet on 10 June to consider any proposal which emerges from the talks.

Speaking in Washington yesterday, Sir Michael Bishop, the chairman of bmi, said if a deal was agreed his airline could be ready to start transatlantic services from Heathrow next summer, at prices below those presently being charged.

Jeffrey Shane, Under Secretary of State at the US Department for Transportation, said he was "cautiously optimistic" that a deal could be struck. "The two negotiating teams have come to a substantial agreement on what is achievable and what must be delivered," he added.

The current bilateral agreement between the US and UK limits access to Heathrow to just four carriers - British Airways, Virgin Atlantic, United Airlines and American Airlines. Bmi, Heathrow's second-biggest operator, has been lobbying for the right to start transatlantic services from the airport for four years without success.

Sir Michael said the US and the EU stood on the verge of a "landmark agreement" which must not be blocked by the vested interests of BA and Virgin. He said demands by BA and Virgin for "sabotage" - the right to operate internal US routes - in exchange for opening up Heathrow to more US carriers was a "red herring" designed to derail any chance of agreement.

If no agreement is reached in the next two months, then progress will be stalled for at least a year. In that case, Sir Michael said bmi would look seriously at launching services to Delhi and Bombay and Johannesburg and Cape Town in South Africa.