American Chief: Visa Rules Hurt Miami International

Miami is one of American Airlines' most profitable cities, the airline's chief executive told a Miami gathering of business leaders Wednesday.

But the federal government's policy after the September 2001 terrorist attacks forbidding foreign passengers from connecting through the airport without visas has cost the airline hundreds of millions in revenue, Gerard Arpey said.

Arpey was visiting Miami as a federal air marshal shot and killed a passenger near an American Airlines jet preparing to depart Miami International Airport for Orlando. His speech to the Greater Miami Chamber of Commerce, given earlier in the day, was upbeat -- though the chairman, president and CEO of American's Fort Worth, Texas-based parent company, AMR Corp., complained about the federal government's taxation and the visa rule.

After later meetings at The Miami Herald, Arpey declined to comment on the shooting inside the jet bridge. American referred calls to the Federal Air Marshal office in Washington, D.C.

Before the Sept. 11 terrorist attacks, an Argentine, for instance, could fly to MIA and switch planes to London or Paris without a visa. Today, that passenger would need a visa, even if for only a few hours' stay.

The problem, Arpey said, is that some Caribbean and Latin American passengers are bypassing MIA and the visa hassle for Canadian and Mexican airports.

American estimates its losses from the 2003 visa decision at $ 100 million.

Last year, Miami International Airport installed a special Customs area for passengers solely to make connections, but many are deterred by the wait at home for visas.

"In Rio de Janeiro, the typical wait time to obtain a visa is 123 days," Arpey said. "That's a four-month wait to obtain a visa, the sole purpose of which might be to change planes in Miami. We don't think that makes a lot of sense -- for our customers, for us, or for Miami."

The new visa rules were one factor in Spanish airline Iberia's decision last year to close its mini-Miami hub, which distributed passengers from Spain to Central and South American destinations.

Arpey's solution: to strengthen security areas for transfering passengers. Though the Transportation Security Administration recently relaxed rules allowing carry-on items such as small scissors, Arpey said there is no indication the government will change its rules and allow nonvisa passengers to be quarantined.

"We're not getting any indication that it's coming," Arpey said.

In addition, Arpey said, the federal government has unfairly placed the security burden on the airlines, further crippling an industry that's reeling from soaring fuel prices.

"This can't all be on the backs of the airlines," he said. "You can't have your cake and eat it too."

Locally, MIA is raising the fees it charges airlines from $ 15.78 per-passenger, on average, to $ 18.10 in 2006. That fee is expected to jump to $ 30 in 2010 and $ 34 in 2010. That is far above the average for American airports, and especially higher than MIA's local competitor, Fort Lauderdale-Hollywood. It charges about $ 4 per-passenger.

Much of the increase is due to the reconstruction of MIA's North Terminal, which will give American 48 gates and make it more efficient for the airline to transfer baggage and passengers. American was supervising construction, but Miami-Dade County took control of the project because of cost overruns.

Still, American is considered one of the strongest legacy carriers in the United States. Arpey said the airline's had one of its highest "load factor" this quarter -- meaning the number of seats filled -- and that fuel prices, though still high, are stabilizing.

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