Truce hopes in transatlantic air war

Attempts to settle a three-year Anglo-American row over transatlantic airline rights appeared to have reached a breakthrough after US negotiators reduced their demands last night.

Negotiations on access to London's Heathrow and US domestic airports broke down in acrimony in 1993. But, as talks re-opened yesterday, one source said there was optimism about a US change of heart.

He said US negotiators were demanding that United Airlines be allowed to fly from Chicago to Heathrow, a far cry from 1993 when they called for greater access for all America's operators.

"We will make more headway with this sort of step by step approach than with blanket demands," he said.

Heathrow, the world's busiest airport, is regarded by US airlines as the gateway to Europe. The Anglo-US bilateral agreement allows only American Airlines and United Airlines to serve Heathrow from New York.

It is also thought the US side is willing to relax its "fly America" policy, whereby government employees cannot use UK airlines on official business.

The London talks are expected to take several days. A spokesman for the Department of Transport said official announcements about the progress of negotiations were unlikely.