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European major airlines' strategic reactions to the Third Package

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  • Chang, Yu-Chun
  • Williams, George

Abstract

Since the Third Package in 1993, European Union (EU) registered airlines have been able to purchase majority ownership of other EU carriers and set up airlines in other EU countries. This paper investigates how European majors have responded to the liberalised policy, especially European Commission Regulation 2407/92. It goes on to analyse the impact of these strategies for airlines and the EU-US relationship in terms of airline alliances. It concludes that British Airways and the SAirGroup have pursued a policy of acquiring airlines in EU countries, with the former finding it an expensive and questionable strategy, and the latter disastrous.

Suggested Citation

  • Chang, Yu-Chun & Williams, George, 2002. "European major airlines' strategic reactions to the Third Package," Transport Policy, Elsevier, vol. 9(2), pages 129-142, April.
    • Handle: RePEc:eee:trapol:v:9:y:2002:i:2:p:129-142
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    Citations

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    Cited by:

    1. Alderighi, Marco & Cento, Alessandro & Nijkamp, Peter & Rietveld, Piet, 2012. "Competition in the European aviation market: the entry of low-cost airlines," Journal of Transport Geography, Elsevier, vol. 24(C), pages 223-233.
    2. Knorr, Andreas & Arndt, Andreas, 2004. "Alliance strategy and the fall of Swissair: a comment," Journal of Air Transport Management, Elsevier, vol. 10(2), pages 119-123.
    3. Dobruszkes, Frédéric, 2009. "Does liberalisation of air transport imply increasing competition? Lessons from the European case," Transport Policy, Elsevier, vol. 16(1), pages 29-39, January.
    4. Simonelli, Felice & Caroli, Matteo Giuliano, 2013. "Harmonization of market entry regulation for the operation of air services in the European Union: A comparative survey of the implementation of Regulation (EC) no. 1008/2008 by Member States' authorit," Journal of Air Transport Management, Elsevier, vol. 27(C), pages 39-45.
    5. Schnell, Mirko C.A., 2005. "Perception of airline industry structure by regulators and managers," Transport Policy, Elsevier, vol. 12(3), pages 221-234, May.
    6. Alderighi, Marco & Cento, Alessandro, 2004. "European airlines conduct after September 11," Journal of Air Transport Management, Elsevier, vol. 10(2), pages 97-107.
    7. Adler, Nicole & Smilowitz, Karen, 2007. "Hub-and-spoke network alliances and mergers: Price-location competition in the airline industry," Transportation Research Part B: Methodological, Elsevier, vol. 41(4), pages 394-409, May.
    8. Chang, Yu-Chun & Williams, George & Hsu, Chia-Jui, 2004. "The evolution of airline ownership and control provisions," Journal of Air Transport Management, Elsevier, vol. 10(3), pages 161-172.

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