Friday, April 13, 2007

U.S.-China Open Skies and Ryanair To Go Transatlantic?

U.S.-China Open Skies

A recent AP story indicates that the U.S. DOT is pursuing an open skies aviation agreement with China.  The DOT hopes to have a draft agreement done by May with a full agreement signed by the end of the year.  A clear winner would seem to be Delta, which does not yet have any U.S.-China routes.  It will be intriguing to see if the Chinese government proposes a phased in agreement to shelter its carriers from full open skies while they attempt to make their product more attractive to U.S. originating passengers.

Ryanair's Transatlantic Ambitions

Yesterday, Ryanair announced its plans to offer transatlantic flights for as little as $12 once the new U.S.-EU open skies agreement comes into effect in 2008.  EU airports to be served are London-Stansted, Dublin and Frankfurt-Hahn.  The carrier plans to serve secondary airports in the U.S. in cities such as New York, San Francisco and Boston.  See Bloomberg article.  News reports also contain speculation that Ryanair may be forced to sell all or some of its one-quarter stake in Aer Lingus if the European Commission decides to block the proposed merger between the two carriers.  See Irish Times article.

Mercer Management Strategy Paper

Mercer Management Consulting recently released a paper suggesting options for airlines to thrive during the next recession.  Options include consolidation, strategic spinoffs, and dramatic productivity increases.  See Mercer paper

Senate Passenger Bill of Rights Hearing

The U.S. Senate Commerce, Science and Transportation Committee recently held a hearing entitled "Airline Service Improvements" which focused on a potential airline passenger bill of rights.  At the hearing, Senators Barbara Boxer (D-Calif.) and Olympia Snowe (R-Maine) disclosed that they might try to attach their proposed bill to the FAA reauthorization legislation due to be considered later this year.  The U.S. DOT indicated that further study of the issue is needed and that it did not back airline passenger bill of rights legislation at this time.  See all testimonyATA head James May's testimony, and an ATW online article discussing the hearings.

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