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

May 8, 2020

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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.

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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 photo by BEN STANSALL/AFP via Getty Images.

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