American-British Airways Code-Share Renewal Draws Fire

SLOW MOTION

What Oneworld partners American Airlines and British Airways portray as a routine renewal of their behind-and-beyond transatlantic code-share operation may turn instead into a second confrontation between international alliances before the U.S. Transportation Dept.

That's something Continental Airlines would like, at any rate. Opposing the AA-BA extension, Continental says two years of the code share have proved that the original objections to it were correct--that American and BA indeed have strengthened their already privileged positions at London Heathrow Airport, and that the U.K. didn't move at all toward a more liberal aviation regime with the U.S. Although the European Commission has taken over negotiating aviation agreements for all its member states, U.K. restrictions and Heathrow entry barriers remain.

Continental and American are prominent bystanders in the department's other alliance hot potato, last fall's first-of-a-kind antitrust immunity application seeking to bring together two alliances that, in effect, were linked by the merger of Air France and KLM. That deal made in-laws out of Delta, which already had antitrust immunity with Air France and the other European SkyTeam carriers, Alitalia and Czech Airlines; and Northwest, the immunized partner of KLM. Also, Delta and Northwest already were partners, along with Continental, in a U.S.-only code share structured carefully to keep all three carriers competing with each other (AW&ST Oct.