Air France-KLM Chief Says US Proposal Could Set Back Open-Skies Pact

The head of Air France-KLM warned that European Union governments were likely to turn down a US proposal on airline ownership and control, endangering plans for a new transatlantic aviation pact, the Financial Times reported.

Jean-Cyril Spinetta, chairman and chief executive of the world's largest airline by revenues, was also quoted by the newspaper as saying he could help Continental Airlines secure slots at London's congested Heathrow airport.

Continental has been the most vociferous opponent of the so-called open-skies deal.

Spinetta said in a speech in New York that the failure to secure open skies after three attempts would be 'a disaster' for the industry, and was likely to trigger action by the European Commission to unwind existing deals between member states and the US.

The EU and the US reached a tentative deal on a new aviation treaty last November, but this hinges on the US transportation department coming up with a change in the control rules deemed 'acceptable' by European transport ministers.

The proposed changes unleashed a storm of criticism from US unions and Continental, which claimed they threatened jobs and posed a threat to national security as foreign investors may be more reluctant to transport US troops on their aircraft.

Spinetta said the US administration had taken 'a step in the wrong direction' by refining the planned rule change last month. 'I doubt the language in the supplemental proposal will be acceptable to the European side in its present form,' said Spinetta.

Continental Airlines, a member of the SkyTeam alliance alongside Air France-KLM, Northwest and Delta, has been the key driver of opposition on Capitol Hill.

According to the report, an open-skies deal would not guarantee carriers suitable access to Heathrow unless they bought the slots on a grey market. Air France has already made an informal offer to help Delta access the airport, and Spinetta said this could be extended to Continental.

'Why not? We could consider it,' he told the Financial Times.



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