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The potential impacts of the EU/US Open Sky Agreement: What will happen at Heathrow after spring 2008

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  • Humphreys, Barry
  • Morrell, Peter

Abstract

The paper examines the impact of removing the restrictions remaining in EU/US bilateral air service agreements, the major one relating to the air services between the US and the UK. These are dismantled under Stage I of the EU/US Open Skies agreement, which will automatically fall unless progress is made on the Stage II issues, especially reform of the US ownership and control rules. Previous evaluations of the likely impact of lifting these restrictions are reviewed, especially in relation to passengers and fares between the US and London. Such evaluations look optimistic given preliminary plans for the first summer season. Reasons why airlines prefer Heathrow to Gatwick are discussed before comparing US/London air service capacity for June 2008 with the previous June, with indications for a 5% increase in overall seat capacity and an 8% increase in flights. A net increase of seven daily flights is planned from Heathrow and Gatwick, not far in excess of normal market growth and no new non-stop routes will be introduced that had not already been operated from either UK airport. These changes are analysed in terms of US and UK airline responses, taking into account slot availability and cost. The seat capacity share of US carriers from both Heathrow and Gatwick advances by just over 2 percentage points to 40%.

Suggested Citation

  • Humphreys, Barry & Morrell, Peter, 2009. "The potential impacts of the EU/US Open Sky Agreement: What will happen at Heathrow after spring 2008," Journal of Air Transport Management, Elsevier, vol. 15(2), pages 72-77.
    • Handle: RePEc:eee:jaitra:v:15:y:2009:i:2:p:72-77
    DOI: 10.1016/j.jairtraman.2008.09.020
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    Cited by:

    1. Ki Han Song & Solsaem Choi & Ik Hyun Han, 2020. "Competitiveness Evaluation Methodology for Aviation Industry Sustainability Using Network DEA," Sustainability, MDPI, vol. 12(24), pages 1-16, December.
    2. Zhang, Shengrun & Derudder, Ben & Fuellhart, Kurt & Witlox, Frank, 2018. "Carriers’ entry patterns under EU-US open skies agreement," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 111(C), pages 101-112.
    3. Narangajavana, Yeamduan & Garrigos-Simon, Fernando J. & García, Javier Sanchez & Forgas-Coll, Santiago, 2014. "Prices, prices and prices: A study in the airline sector," Tourism Management, Elsevier, vol. 41(C), pages 28-42.
    4. Zhang, Yi & Zheng, Xingwu & Lu, Wei, 2018. "Measuring the openness of Chinese international air transport policy," Transport Policy, Elsevier, vol. 72(C), pages 208-217.
    5. Njoya, Eric Tchouamou & Christidis, Panayiotis & Nikitas, Alexandros, 2018. "Understanding the impact of liberalisation in the EU-Africa aviation market," Journal of Transport Geography, Elsevier, vol. 71(C), pages 161-171.

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