Air Transport World

AEA membership divided; member airlines are split on decision to move more quickly towards liberalization, or to take a slow, conservative approach.

AEA membership divided

The major scheduled airlines of Europe, traditional partners in a complicated network of political and commercial agreements, have gone into a state of severe disarray as the tide of liberalization of fares, routes and schedules begins to lap across the continent. What was once a united camp has recently split into two, with demands for swift progress towards a more liberal regime led by the British, Dutch, Irish, Swiss and Finns, being countered by schemes for far-slower, step-by-step moves by a conservative group.

In the background lurks the European Community's transport commission issuing threats to take airlines to court under the restrictive practices legislation of the Common Market unless further impetus is seen to be given to liberalization. Additional pressure is being exerted unilaterally by the government of Margaret Thatcher in London, which has recently made agreements with Holland, West Germany, Luxembourg and Belgium, under which airlines are able to fly between any points in their own countries and the U.K., deciding for themselves the frequency and capacity of their services. The agreements also loosen considerably the tariff regulations.

The focal point for this activity is the headquarters here of the Association of European Airlines (AEA), whose Secretary-General, Karl-Heinz Neumeister, told ATW, "I think we will have gradual liberalization. The majority of members want to go one step, but others want to go two or three steps. Our strength is to agree sometimes, but we also agree to disagree. I do not regard that as a weakness, but as a strength, because we are not a cartel.'

There are 20 members at this writing of the AEA--Aer Lingus, Air France, Alitalia, Austrian, British Airways, British Caledonian, Finnair, Iberia, Icelandair, Jugoslav, KLM, Lufthansa, Luxair, Olympic, Sabena, SAS, Swissair, TAP, Turkish and UTA-- and their strength to which Neumeister referred was severely tested at a recent meeting in Brussels. The meeting was prompted by the increasingly urgent demands of the transport commission of the European Community for speedier moves towards an element of deregulation. It was apparently a stormy meeting--Neumeister described it as "lively'--as British Airways and British Caledonian, and their allies, pushed for greater progress. …

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