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Cheaper transatlantic flights? British Airways and American Airlines to give up some London slots

May 08, 2020
3 min read
Cheaper transatlantic flights? British Airways and American Airlines to give up some London slots
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British authorities want to make it easier for new competitors to fly routes between London and the U.S.

The United Kingdom's Competition and Markets Authority (CMA), which is charged with promoting competition to benefit consumers in the U.K. announced Thursday that British Airways and American Airlines will be giving up some slots at Heathrow or Gatwick in response to concerns that the airlines' transatlantic joint venture has become too dominant in certain markets.

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The CMA said it is particularly concerned about AA and BA's position serving London from Boston, Chicago, Dallas, Miami and Philadelphia.

As a result, the two airlines have agreed to give up take off and landing slots at Heathrow and Gatwick — London's two busiest airports — to allow other carriers to compete more easily on those routes.

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“On some of these routes there are either few or no other airlines offering direct flights to passengers,” Ann Pope, the CMA’s senior antitrust director said in a statement. British Airways and American Airlines’ decision to give up some slots, she added, “has the potential to increase competition and deliver lower fares for customers, while also preserving the benefits that joint airline agreements offer passengers.”

Landing rights at the two airports are tightly controlled. Slots can be especially hard to come by at Heathrow, and are expensive when they do come on the market. In 2016, for example, The Times of London reported that Oman Air paid $75 million for a pair of take-off and landing slots there — enough for just one daily round-trip flight.

Read more: American Airlines’ Boeing 767s, 757s among 80 planes that won’t fly again.

The announcement is especially welcome news for airlines like JetBlue, which affirmed in a call with investors Thursday that it is still planning to break into the transatlantic market to serve London from New York and Boston as soon as next year.

The CMA did not call for New York flights to be included in its slot decision, meaning JetBlue would still have to secure slots another way for flights from New York JFK -- it's busiest hub. But Boston -- JetBlue's second-busiest hub -- was included in the CMA decision, possibly opening the door for JetBlue there.

The new availability of slots also could increase speculation about which London airport the New York-based low cost carrier will serve, and may tempt some other airlines to throw their hats in the ring as well for flights on the routes covered in the CMA decision.

Featured image by AFP via Getty Images

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TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
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Why We Chose It

If you are looking to take your premium rewards to the highest level, this card is really a no brainer in our eyes. Chase's Ultimate Rewards make points easy to redeem, with a wide range of 10 airline and three hotel transfer partners and a friendly user interface. Despite the high annual fee, Chase is consistently adding new benefits to keep the card competitive in a fierce premium rewards field.

Pros

  • $300 annual travel credit as reimbursement for travel purchases charged to your card each account anniversary year
  • Access to Chase Ultimate Rewards hotel and airline travel partners
  • Unlimited 3x points on the broad category of travel and dining
  • 50% more value when you redeem your points for travel through Chase Ultimate Rewards®
  • Broad definitions for travel and dining bonus categories

Cons

  • Steep $550 annual fee
  • May not make sense for people that don't travel frequently
  • You must spend the $300 travel credit before earning 3x points for travel and dining
  • No automatic hotel elite status
  • Earn 80,000 bonus points after you spend $4,000 on purchases in the first 3 months from account opening. That's $1,200 toward travel when you redeem through Chase Ultimate Rewards®
  • $300 Annual Travel Credit as reimbursement for travel purchases charged to your card each account anniversary year.
  • Earn 5x total points on flights and 10x total points on hotels and car rentals when you purchase travel through Chase Ultimate Rewards® immediately after the first $300 is spent on travel purchases annually. Earn 3x points on other travel and dining & 1 point per $1 spent on all other purchases
  • Get 50% more value when you redeem your points for travel through Chase Ultimate Rewards®. For example, 80,000 points are worth $1,200 toward travel
  • 1:1 point transfer to leading airline and hotel loyalty programs
  • Access to 1,300+ airport lounges worldwide after an easy, one-time enrollment in Priority Pass™ Select and up to $100 application fee credit every four years for Global Entry, NEXUS, or TSA PreCheck®
  • Count on Trip Cancellation/Interruption Insurance, Auto Rental Collision Damage Waiver, Lost Luggage Insurance and more