Virgin Atlantic files complaint with EC
LONDON - Reuters
Virgin Atlantic President Richard Branson complains that BA will dominate the take-off and landing slots at Heathrow.Virgin Atlantic has lodged a formal complaint with the European Commission about IAG’s purchase of Lufthansa’s British unit British Midland International (bmi), saying competition on some European routes would diminish and that fares would increase.
Late last year, British Airways (BA) owner IAG agreed to buy bmi for 172.5 million pounds ($271 million), seeing off rival bidder Virgin in the race to grab loss-making bmi’s coveted runway slots at London’s Heathrow airport.
In its submission Virgin Atlantic said that if the deal was approved, three key domestic routes -- Aberdeen, Edinburgh and Manchester -- to and from Heathrow would become a BA monopoly.
It added that competition to some popular European destinations would be eradicated, and that BA would thus be able to increase fares and reduce flights on these routes.
BA will hold more than half of take’offs and landings
“When BA was left the only operator on the Glasgow to Heathrow route in 2011, fares paid by Scottish travelers rocketed by 34 percent in six months,” Virgin Atlantic president Richard Branson said in a statement.
“This deal will see BA holding more than half of take-off and landing slots at the UK’s only major international hub -- an airport that has had much needed growth plans forcibly frozen.”
The all-cash deal, which requires regulatory approval, would give IAG about 53 percent of take-off and landing slots at Heathrow, -- Europe’s busiest airport -- which is operating at capacity after plans to build a third runway were scrapped.
IAG currently holds 43.1 percent of the slots at Heathrow.
“Our planned purchase of bmi is being reviewed by the regulatory authorities and we’re confident they will approve the deal,” IAG said in a statement.
BMI is a loss making airline
“Bmi is a massively loss making airline. Selling it to IAG offers the best solution for British consumers and UK plc, securing more jobs than if the airline was broken up and sold-off for its Heathrow slots.”
IAG added that it was committed to keeping services from Belfast to Heathrow and increasing flights to Scotland.