Branson Writes McCain, Obama about BA, AA Alliance

Sir Richard Branson, president of Virgin Atlantic Airways, has written a letter to John McCain and Barrack Obama warning them about the proposed alliance between British Airways (BA) and American Airlines (AA). Branson claims such a move would harm consumers by destroying competition on major transatlantic routes. Later this week, BA and AA are expected to file an application to fix timetables and prices in addition to sharing frequent flyer details and revenues on their route networks.

"BA/AA would have a combination of high frequencies and a transatlantic network that could not be replicated by any other airline/alliance, and which would make it impossible for other carriers to compete for time-sensitive corporate or business travelers," Branson wrote in the letter. "Airlines everywhere are struggling with the current price of oil, but the solution to their problems should not lie in an anti-competitive agreement, which will inevitably lead to less competition and higher fares.

"Neither is the current economic slowdown a justification for waiving through any application. The job of the regulators is to assess the long-term impact of the alliance on competition, not to provide special protection from the immediate challenges of the economic cycle, with which every other airline has to deal with."

This will be the third time BA and AA attempt to gain permission to align their operations. In past reviews, regulators expressed concerns about the anti-competitive nature of the proposal.

In addition to the letter, Branson will continue to campaign against the proposed alliance as Virgin Atlantic will soon launch a major lobbying and advertising campaign to make sure that regulators and consumers are fully aware of the potential results BA and AA alliance.

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