Friday, March 9, 2012
Australia's Qantas has broken off partnership talks with Malaysia Airlines. See Matt O'Sullivan, Qantas Shelves Asia Airline Plan, Sydney Morning Herald, March 10, 2012 (available here). The two companies had been discussing a joint venture to establish a new carrier in Kuala Lumpur. Qantas is eager to establish a larger presence in the fast-growing Asia-Pacific market, but will have to wait to do so after this latest setback.
Wednesday, March 7, 2012
Blog readers might be interested in The Economic Regulation of a European Hub Airport: An Iron Triangle?, by Philippe Villard (available from SSRN here). From the abstract:
This article examines the economic regulation of a hub European airport and the relationship system between actors involved in, or subjected to, this regulation. Studying the case of Aéroports de Paris, it is argued that airport economic regulation is produced by the strong conjunction of interests between the hub airport’s operator, the dominant airline, and public authorities. These three categories of actors form an “iron triangle” framing and shaping the terms of economic regulation to satisfy their interests, and the shift from a cost-plus to a price-cap regulation does not dramatically threaten the maintenance of the triangle. All other actors (nondominant, domestic airlines, and international air carriers) are excluded from the iron triangle even if they remain deeply affected by its decisions. Finally, this article calls for an analytical generalization of this theorization for semiprivatized European hub airports.
Monday, March 5, 2012
Heathrow operator BAA is reportedly considering bringing a legal challenge against the UK Government's opposition to a third runway at the London airport. See Diane Evans, BAA Could Mount Legal Challenge Over Heathrow Runway, TravelMole, March 5, 2012 (available here). The Department for Transportation will release a highly anticipated aviation policy paper later this month, and much of the focus will be on its proposed solutions to the UK's lack of airport capacity. Over the weekend business and union leaders sent a letter to the Sunday Telegraph urging the Government to reconsider plans for a third runway at Heathrow which were scrapped when the current governing coalition came into power. See Government Urged to Allow Airport Expansion, BBC, March 3, 2012 (available here). Should BAA pursue legal action, it is likely to argue that the Government failed to follow due process in ruling out airport expansion without proper consideration and would seek judicial review of the Government's decision.