Virgin raises challenge to planned BA and American merger

Sir Richard Branson, head of Virgin Atlantic Airways, has recently to both candidates for the US presidency, in protest of a potential merger between American Airlines and British Airways.

He maintains that such a deal would hurt competition on trans-Atlantic services and would mean customers losing out, with no market mechanism for controlling price.

BA has not commented on his remarks, but did say to the BBC that it would be making an announcement regarding the deal with American Airlines within a few days.

Airline industry experts have said that BA is prepared to sacrifice “hundreds” of its trans-Atlantic flights in order to secure the agreement.

The British carrier has attempted to finalise a deal with its US rival two times in the past, but was not willing to relinquish a significant share of its flight slots as required by US regulators.

The Mail on Sunday is now reporting that BA now sees giving up these slots are worthwhile, and adds that the airline is likely to make that offer to the US Department of Justice this coming week.

BA has also commented that recent relaxation of regulations under the Open Skies agreement will help finalise the deal.

www.virgin-atlantic.com