UPDATE:=British Airways Walsh: Heathrow Full, More Slots Eyed
(Updates to add comment by Sir Richard Branson)
By Doug Cameron
OF DOW JONES NEWSWIRES
The head of British Airways PLC (BAY.LN) said Friday that its planned merger
with Iberia Lineas Aereas de Espana SA (IBLA.MC) was partly driven by London
Heathrow airport being "full", fueling debate over the planned expansion of the
airline's Oneworld alliance.
Access to Heathrow is a key part of a regulatory review on both sides of the
Atlantic into a request for antitrust immunity by BA, Iberia, and American
Airlines, a unit of AMR Corp. (AMR).
"It's well recognized that Heathrow is full, but Madrid has capacity," said BA
Chief Executive Willie Walsh on a call with analysts.
Walsh said using Madrid as the focus for services between Europe and Latin
America would provide room at congested Heathrow to launch more services to
North America and Asia. He said feeding Latin American passengers through Miami
was "sub-optimal".
Miami is American's key gateway to Latin America.
BA and its Oneworld partners are the largest holders of take-off and landing
slots at Heathrow. Critics of their application for antitrust immunity, notably
Virgin Atlantic Airways Ltd., claim that Oneworld's grip on the airport makes
any extension of their alliance anti-competitive.
Airlines continue to buy, sell and lease slots at the airport, but peak-time
access is severely restricted.
Walsh said on the call that he was confident BA could pick up some additional
slots at Heathrow, and also said the airline was still interested in acquiring
Deutsche Lufthansa AG's bmi unit (British Midland Airways), the second-largest
slot holder at the airport.
"If Lufthansa is looking to dispose of bmi, then we are definitely interested,
" he said.
BA, American and Iberia – together with two other Oneworld partners &#
8211; sought antitrust immunity last year to secure what they call a level
playing field with members of the rival Star and SkyTeam alliances. In an
unusual move, U.S. Regulators missed a statutory deadline at the end of October
to make an initial ruling on Oneworld's application. This reflects tension
between the transportation and justice departments over airline competition
policy, according to people familiar with the situation. European regulators
have also issued concerns over the expanded tie-up which includes access to
Heathrow.
Walsh said the antitrust application and Iberia talks were "separate issues",
and saw no "complications" for the competition review process from its
continuing merger negotiations.
Sir Richard Branson, president of Virgin Atlantic, reacted to Willie Walsh's
admission that Heathrow is full by saying: "Finally Willie Walsh is admitting
what everyone knows to be true - Heathrow is full - it is about time he says the
same to the regulators. BA and AA should rewrite their submission to reflect
this."
-By Doug Cameron, Dow Jones Newswires; (312) 750 4135; doug.cameron@
dowjones.com
(END) Dow Jones Newswires
11-13-091014ET
Copyright (c) 2009 Dow Jones & Company, Inc.
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