The New Open Skies: How It Affects You

March 28, 2008

On Sunday, March 30, the new Open Skies agreement between the U.S. and European Union will go into effect. The agreement has two main components of interest to travelers:

The first states that airlines flying internationally no longer have to include a stop in their home country. For example, British Airways can now offer a nonstop flight from Paris to New York without including a stopover in London.

The second removes limitations on the number of airlines allowed to fly between London Heathrow and the U.S. Currently, only American Airlines, British Airways, United Airlines and Virgin Atlantic can offer transatlantic flights from London's main airport.

What does this mean to you as a consumer?

First of all, it will mean more flight options on more carriers. Continental, Delta and Northwest will introduce new service from their U.S. hub cities to Heathrow as early as March 29. British Airways's new OpenSkies subsidiary will launch in June with flights between New York and Paris. Plus, European lines such as Air France have the opportunity to begin service between the U.K. and destinations throughout the Continent.

If you've been hoping for a nonstop flight from your home city to the U.K. or Europe (or conversely traveling from the U.K. to the U.S. to take a cruise), you may be in luck. No more time-consuming and exhaustive connecting flights, lugging heavy carry-ons across a crowded terminal, and hoping your suitcases full of swimsuits and formalwear make the connection with you.

More importantly, increased competition could lead to lower prices as airlines jockey for your business. The airlines that can offer the best service and most enticing prices may take over markets currently dominated by less appealing airlines. This could also mean more mergers and strategic airline alliances in the days ahead, as companies fight to reposition themselves in the changing market. Plus, low-cost European carriers can now contemplate launching transatlantic service to the U.S.

But if you expect airfares to drop radically before your next cruise, think again. New routes are limited by airport capacity, and major airports such as congested Heathrow don't have much room for new flights. Plus, with oil prices at all-time highs, airlines are only able to drop fares so much, especially on long-haul flights, without going bankrupt. Finally, most airlines will concentrate on attracting business travelers, so business hubs such as Paris, Frankfurt, Brussels and Milan will see new service before the cruise ports of Rome, Venice and Barcelona.

It's not clear how long it will take before we see the entire impact of the Open Skies agreement. Just keep your fingers crossed that flying to your next European departure port may get a little easier…and cheaper.

--by Erica Silverstein, Associate Editor