US Transportation Secretary, Ray LaHood, expressed his support for the US-EU open skies agreement, which came into effect in Mar-2008, stating that the agreement has been “very good for the flying public and for spurring growth in the industry” (Dow Jones, 10-Sep-2009). The comments come less than a month before US and EU officials are due to resume negotiations on the second round of open skies negotiations. The European Commission stated it was encouraged by the support shown by Mr LaHood. Concerns had been raised for the future of the open skies agreement, after US House of Representatives Transportation Committee Chairman, Rep. James Oberstar, expressed his "deep concern over the decline of airline competition in international markets." Separately, the US and Japan commenced three days of bilateral air services negotiations this week.
US expresses support for EU-US open skies agreement, US-Japan talks commence
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Challenges to airline liberalisation. Mindset changes needed: CAPA Americas Summit (VIDEO)
Tentative approval was finally granted by the Us DoT for Norwegian Air International to introduce long haul, low cost service from Europe to the US. Even though the opponents have successfully lobbied legislators to introduce prohibiting legislation, this was a milestone in the contentious debate about open skies agreements, as well as the intricacies of labour law and foreign ownership requirements. There was a lively debate on this topic at CAPA's Americas Aviation Summit, under the guidance of CNN anchor, Richard Quest.
However, in the larger scheme of liberalisation Norwegian’s victory is a small step in what appears to be a long journey for a mindset change: to create new paradigms in the rapidly changing global aviation industry. In the US aviation landscape the easing of foreign ownership restrictions remains a non-starter, which means that joint ventures will continue to serve as stand-ins for cross-border ownership. As the status quo remains, and members of large global alliances holding anti-trust immunity dominate markets such as the trans-Atlantic, Norwegian’s ability to inject low cost competition is welcome, and a logical development.