With Meghit done, and now after an interminable wait Brexit done as well, the U.K. is turning to new trade agreements where necessary in order to replace those they’d been covered by while part of the E.U. Indeed, the U.K. needs a deal with the E.U. along with myriad other countries.
The former U.K. ambassador to the U.S. has been a part of discussions, and has insight into both sides of discussions. He predicts,
- The U.S. Presidential and congressional elections make it tough for the U.K. to get a U.S. trade deal this year.
- The U.K. lacks the negotiating teams to simultaneously push E.U. and U.K. deals.
- The U.S. administration is likely to push for U.K. purchases of agricultural products (because farmers supported the President) and higher drug prices.
In aviation, the U.K. wants access to U.S. domestic markets but knows for all of the U.S. rhetoric on free trade they’ll never give up this protectionism,
British Airways would love to be able to pick up passengers in London, fly them to, say, New York or Boston, and fly them on to St Louis and finish up with them in San Francisco. Are we going to get that? There is no chance the Americans are going to give us those rights to allow British carriers to break into the US domestic market, which is fantastically lucrative.
For the British, while the U.S. warns of their protectionism, questions remain about U.S. willingness to open its own markets in financial services and government procurement (including military hardware) among others.
Even if British Airways were permitted to operate U.S. domestic routes, they’d still be gate constrained at congested airports. Moreover their American Airlines joint venture makes entering the U.S. domestic market less of an imperative. They wouldn’t bring with them a new business model in any case. The country would be better served with cabotage that allowed for competition from Ryanair, Wizz Air, Emirates, and Singapore.
Yeah, good luck with that.
As the former ambassador has burnt his bridges with both the UK Prime Minister and the US President, I really wouldn’t take his word on any of this – his channels will be very poor.
And there’s no conceivable reason why BA would want to run domestic US services. Even apart from Americans’ innate protectionism (why would an average person choose an obviously foreign carrier), BA has never exercised its existing right to operate flights wholly within the EU excluding the UK: instead it has bought other carriers to do that.
Far more likely, the two sides would be exploring the ability for there to be some form of equity swap between BA and AA, both joint venture partners. DL has this with AF, KLM and VS, but it’s hampered by US regulations. It could well be that BA and AA would want to go further.
If the Gulf states keep buying Boeing and US arms who knows Trump might let them fly limited domestic routes, say NY to LAX. Or LAX to NY to Dubai. It’s my understanding the Secretary of Transportation can suspend cabotage by executive order in some cases.
LOL. Yes, BA might “love” that, but nobody is going to buy a ticket LHR-SFO with two layovers. Crazy stuff. What BA might want to do is fly a “triangle” to second-tier airports, so LHR-(city1)-(city2)-LHR/LHR-(city2)-(city1)-LHR, with the middle leg a short domestic hop, when city1 and 2 aren’t each big enough to warrant direct LHR service, but collectively they are. This would require 8th freedom rights, and sure, that might not be on the table — the UK is too small to offer an attractive level of reciprocity, while the EU isn’t, and US-EU also hasn’t made such an agreement. Full 9th freedom access to the US domestic market indeed seems unlikely, but also isn’t something BA would care about.
I doubt that the UK ( or Europe for that matter) will be brow-beaten, bullied or blackmailed into taking more US agricultural produce…and certainly not the chlorinated chicken that has been contemplated in the media. It might be fine for Chick-Fil-a but won’t fly in London, Paris or Berlin.
Salmonella infection is 7 times as high in the US as it is in countries with better food safety regimes, including the UK. Perhaps that’s part of the reason why the chicken needs to be bleached.
And there’s no way imaginable that any country will accept higher prices for medicine. Boris will have the fastest fall from Grace in history if he even considers it. It’s not going to happen, and neither will this BA idea for domestic flights.
The U. S. domestic market is “fantastically lucrative”?
Wth?
Yeah…. The odds of the U.S. granting cabotage rights are approximately zero. I would also point out that this is hardly limited to “U.S. protectionism.” Almost every country on Earth refuses to grant cabotage rights with the only particularly notable exception being that EU countries grant them to each other.
It is funny that America claims to be the home of capitalism and free markets and yet it has strict cabotage vis-a-vis airlines and cargo shipping. At least airlines aren’t required to have US-built, US-flagged and US-crewed planes, unlike maritime shippers.
In the past didn’t British Airways fly LHR-DFW–IAH-LHR with no local passengers between DFW-IAH? I believe it was considered a thru flight at IAH (Houston) with a ground time of 30 minutes.
John C,
There was a codeshare with Braniff on the concorde with both BA and AF that allowed Braniff to operate the DFW-IAD-DFW portion of the flight in order to get around the cabotage laws.
Kim Darroch, the former ambassador, 20 or 30 steps removed from power knows how the negotiation is going to go. I hear 10 such “experts” on Bloomberg News every day.
Ba should relocate to term8 at jfk and then allow passengers to connect to any us domestic American airlines flight