US considers raising foreign ownership limits

Dizel8

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November 2, 2005 The Bush administration wants to ease restrictions on overseas investment in US airlines, a move that could give struggling carriers a route for fresh capital and break the logjam in transatlantic aviation talks, industry sources said on Wednesday.
Airline industry officials who did not want to be named because it is a government initiative said the Transportation Department is preparing a plan that would ease the tightly scrutinized administrative regulation barring overseas investors from exercising control of domestic carrier operations in certain circumstances.
The administration will not, according to the industry sources with knowledge of the plan, propose any changes to the strict law that caps international investment at 25 percent of voting stock.
Congress has prevented any changes in current ownership regulations, with many lawmakers arguing that control of airlines is a unique component of the American business identity and necessary to ensure national security especially after the September 11, 2001, attacks.
Labor groups and their political allies have also fought hard to prevent ownership changes that they claim could undermine their jobs.
"We've seen dozens of industries from steel to autos to textiles go over the side as a result of globalization or allowing foreign entities to take them over," said Edward Wytkind, president of the AFL-CIO's transportation trades unit.
But US airlines could lose up to USD$10 billion this year, according to industry estimates. Three big carriers are in bankruptcy and face huge hurdles in raising cash to satisfy creditors and potential investors.
Aviation consultants said removing the limits on control might satisfy European negotiators at recently revived talks on liberalizing transatlantic aviation. Previous talks have foundered partly on European demands for greater access to US markets.
John Byerly, the deputy assistant secretary of state for transportation affairs, said the issue is not on the negotiating table. But he said the administration has been exploring options to increase foreign investment.
"It's a good thing to do for our own industry," Byerly said.
The two sides agreed last month in Brussels on key elements of a first-stage deal. The next round of talks is scheduled for the week of November 14 in Washington.
 
O

OpenSkies

This is good news. Hopefully a full open skies agreement will be forthcoming.
 

General Lee

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I don't mind some extra capital brought in from foreign ownership. If you read the article, the max ownership would still be 49%, with 25% voting rights, and our government still will not allow foreign airlines to fly over here.(in mass--like Easyjet setting up a base here)


Bye Bye--General Lee
 

mynameisjim

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General Lee said:
I don't mind some extra capital brought in from foreign ownership. If you read the article, the max ownership would still be 49%, with 25% voting rights, and our government still will not allow foreign airlines to fly over here.(in mass--like Easyjet setting up a base here)


Bye Bye--General Lee
Then what does this initiative change? If ownership remains at 49% and voting at 25%, how does that allow more foreign captial?
 

General Lee

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mynameisjim said:
Then what does this initiative change? If ownership remains at 49% and voting at 25%, how does that allow more foreign captial?
Sorry, it increases the ownership to 49%, from 25% I believe. More capital is better than no capital.


Bye Bye--General Lee
 

Flying the Line

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This is Retarded...The US won't let some airline mergers happen due to anti-trust concerns but apparently it is OK for foreign entities to own the airlines.
 

Cpt. Underpants

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Just my 02c...

As most American managers are clearly incapable of running airlines efficiently and at a profit (ensuring job security and steady income) then what exactly is so bad about letting talented, rich foreign companies own and run the airlines for you? It will mean growth, advancement, foreign access, shiny new jets and jobs...is this bad? I'm not talking about the easyjets or ryanairs here, but class acts like BA, AF/KLM, SQ and CX.

Don't be so xenophobic...we are all supposed to be discoverers, so open your mind a little.
 

typhoonpilot

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Cpt. Underpants said:
Just my 02c...

As most American managers are clearly incapable of running airlines efficiently and at a profit (ensuring job security and steady income) then what exactly is so bad about letting talented, rich foreign companies own and run the airlines for you? It will mean growth, advancement, foreign access, shiny new jets and jobs...is this bad? I'm not talking about the easyjets or ryanairs here, but class acts like BA, AF/KLM, SQ and CX.

Don't be so xenophobic...we are all supposed to be discoverers, so open your mind a little.

And since "Keep Discovering" is Emirates motto, let's not forget them either ;) .


TP
 

Rez O. Lewshun

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Get a perpsective! How does this impact pilots!

Please provide a comparative analysis on the maritime industry and the airline industry. Why are there very limited martime frieghters with US Citizen captains, officers and crews. Why are there no maritime ships registered in the US?

If it is ok the foreign ownership be changed from 25% to 49% today, then will it be ok later to change it to 50+%.

If foreign ownership at 50+% means foreign control, and management controls hiring, who will they hire? Who are they obligated to employ?

If a foreign entity controls an airline operating inthe US, must they use US registered aircraft? If they can't can they lobby to change the legislation?

Two of many reasons in our favor... CRAF and national security.


Maybe the demise of the Air Line Pilot profession will occur faster than we think. In less than 10 years we could be finished.


If we don't even understand what is going on how can do a thing to stop it... The people that want to change the ownership laws...do not care about us as Air Line Pilots. They don't care who fills the flight deck seats.

All of this will be determined on CapHill.

Prediction: in a couple of years the impact of this will hit HARD! Pilots will be taking thier bus tours to Washing DC to rally for support. By then it will be too late as the train will have already left the station....


Get informed. Get educated. Get involved! now
 
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Gotta love Bush!

LET THE OUTSOURCING OF AMERICA CONTINUE!!! (Ok so this is a little different than outsourcing...but...)

I POROMISE in the next 3 years you will see foreign national pilots outsourced/domiciled overseas working for US Legacy Airlines flying a significant portion of the international routes. Mark my words.

Thanks George!
 

Cpt. Underpants

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typhoon

...with memories of 9/11, Korea and WW2 still fresh in the minds of many Americans, I think you can safely rule out any ownership by our Arab, Chinese or Japanese brethren!
 

Dizel8

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furloughfodder said:
I POROMISE in the next 3 years you will see foreign national pilots outsourced/domiciled overseas working for US Legacy Airlines flying a significant portion of the international routes. Mark my words.
Well, I think it might be more than three years, although not by much, but I think you are correct.

We are looking at potential changes in the ownership laws, open skies agreements, not to mention cabotage which has already been approved for flights in and out of PANC, although cargo only.

This isn't about what is best for US pilots, it is about what is best for business and the almighty dollar. If NWA managements proposal, with regards to outsourcing F/A's on international flights, is any indications, those that count the dollars have already given this some serious thought.
 

Clyde

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furloughfodder said:
Gotta love Bush!

LET THE OUTSOURCING OF AMERICA CONTINUE!!! (Ok so this is a little different than outsourcing...but...)

I POROMISE in the next 3 years you will see foreign national pilots outsourced/domiciled overseas working for US Legacy Airlines flying a significant portion of the international routes. Mark my words.

Thanks George!
Who was it that got the ball rolling with NAFTA?? Oh yeah, Clinton. I think you should thank slick Willy. While you're at it, quit blaming the Presidency for your own executive's incompetentcy.
 

Dizel8

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Well, who gave us CAFTA??

The sooner we realize, that in most cases they are equally bad, the sooner we can work on getting some changes.

But Clyde, if you think President Bush gives a rodents rear about you on this issue, please give him a call and tell him we are a bit worried. Who knows, if he is unlike most politicians, you might be able to pry him away from the money trough:)
 
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Clyde

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Dizel8 said:
Well, who gave us CAFTA??

The sooner we realize, that in most cases they are equally bad, the sooner we can work on getting some changes.

But Clyde, if you think President Bush gives a rodents rear about you on this issue, please give him a call and tell him we are a bit worried. Who knows, if he is unlike most politicians, you might be able to pry him away from the money trough:)
I challenge you to name one politician from any political party who would be more influenced by yours and my needs over money.

It is not the Presidency that outsources work, that decision is made by the corporations. Some politicians make that easier than others. If they don't, the execs just shut operations down here in the U.S. and move it elsewhere.

But, not all is doom-and-gloom. Some jobs are shipped overseas, while others are shipped here and in a lot of cases pay better. Ask former textile workers in the south who are now working at BMW plants.

Sometimes the glass is half full too.
 

Dizel8

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Clyde,

"I challenge you to name one politician from any political party who would be more influenced by yours and my needs over money."

We totally agree, so please, let's not turn this into a political discussion, although it certainly is politics at work. As for your comment, that they would simply move the plant out of the US, fine, tax the product as it reenters the US. Of course, NAFTA and now CAFTA removes those import taxes, which in turn makes prodution outside the US cheaper. We will not get into how they avoid paying taxes in general, by maintaining offhsore accounts.

This has more to do with the future of the airline business in the US in general and us employees in specifics. Whenever a politician or a CEO starts talking about how things will be better if only you give me this, then it is time to start running in the other direction.

In general, it is not the US clamoring to get open skies, it is the EU and in particular BA/VA. They desperately wants more access to the US, since we are by far the biggest market. There is one airport, and one airport only, in the EU that US carriers really wants access to, LHR. Are we going to open US skies to the EU simply for 20 or 30 more slots at LHR? I certainly hope not, since to me that equates to buying Manhattan for a few pearls.

Further, I should mention, that not to long ago, UPS and FedEx were foaming at the mouth, upset about the DHL-Deutsche Post debacle, yet now UPS/IPA are willing to consider open skies and foreign ownership . Perhaps, just perhaps, the UPS IPA pilots should start thinking, that with the new contract, which they certainly deserve, are going to very highly compensated, more so than probably all foreign freight carriers. Sure, they have a contract that forbids outsourcing, yet the Menlo story continues to unfold. FedEx really is in the same boat.

So I guess, all of us, freight and passenger, are in this one together!
 
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Rez O. Lewshun

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So can we do much about it or are we going to sit around and watch it unfold. can we get organized? Can we get effective in Wash DC.

Does anyone have any solutions?
 

Dizel8

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I haven't the foggiest, but here is an issue where ALPA/IPA/APA etc. probably should let their voice be heard, one way or another.

If you want to march at Washington, just say when!
 

JohnDoe

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Seems like the word needs to get out big time. Start by talking to everybody in the "industry" that you can. Some may not even know it is up for debate again. Get them to do the same. Everybody calls their reps in DC to let them know they need to vote no. I've even asked family members to call/write reps.

As far as ALPA goes, it seems like they are pretty quiet on the issue this time around. Maybe I'm just not seeing it, but I would think they would be all over this.
 

Flying the Line

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Onboard gambling may lead to free flights on Ryanair

By Michael Harrison, Business Editor

Published: 03 November 2005



Passengers on Ryanair could one day fly for free if revenues from onboard gambling and other services end the need for it to charge fares, the chief executive of the airline has predicted.
Michael O'Leary said Ryanair, the second biggest international carrier in the world, gave away about a quarter of its seats last year and that figure could rise to 50 or even 100 per cent depending on how successful in-flight gaming proved.

The Dublin-based airline hopes to launch a gambling service in the next 12 to 18 months, provided it can devise a payment system that allows it to debit a passenger's credit card before the plane lands.
Passengers will be able to gamble using either their mobile phones or Blackberries supplied by Ryanair. All the calls would be routed through an onboard mobile "sub-station" enabling Ryanair to get a cut of the call charge as well as a percentage of the takings.

He denied that Ryanair would taint the image of flying by turning aircraft into gambling dens which would be unsuitable for families with young children.
"The flag carriers have been ripping us all off for the last 40 years," Mr O'Leary said. "The image of airlines today is high-cost, rip-off, poor food. I don't see how onboard gambling could make that worse."

Mr O'Leary lashed out at those who criticised Ryanair's flight give-aways for fuelling the rise in aircraft carbon emissions.
He said: "We want to annoy the f****** whenever we can. The best thing we can do with environmentalists is shoot them. These headbangers want to make air travel the preserve of the rich. They are Luddites marching us back to the 18th century."
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This is ridiculous..If Ryanair is olny about money then they should get into another business. There are still many great US airlines that provide a service and also provide a great career to their employees. We do not need this kind of airline or its management in the United States of America.
 
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