All our competitors have rallied against the alliance because they have their own agendas to pursue

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Ballet Shoes Center.com

Published: August 14, 2010

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All our competitors have rallied against the alliance because they have their own agendas to pursue.”The BA team working on the alliance planning meets today to take stock of the situation and continue preparing the airline’s formal response to Mr Van Miert. The European Competition Commissioner, Karel Van Miert and the US General Office of Accounting, which reports to Congress, both recommended that 350 slots be surrendered.But Delta said yesterday that between 700 and 800 slots should be given up and redistributed to rival carriers if real competition were to be preserved following the launch of the alliance.Approval for the BA-American tie up will pave the way for an open skies agreement between London and Washington, liberalising air services across the Atlantic by permitting any US carrier into Heathrow.Stephan Egli, Delta’s newly appointed vice-president for the Atlantic and Pacific, said that releasing 168 slots would only allow proper competition to take place on one route – Heathrow to New York’s JFK airport – where the combination of BA and American would otherwise dominate with 13 non- stop flight a day.Mr Egli said that if there were to be real competition on the four, or give other routes where BA and American would have a stranglehold, then as many as 800 slots would need to be freed up: “We recognise that is a tremendous number of slots but it needs to be done if we are not to allow a monopoly.”The alternative, he added, would be higher price and less choice because other carriers would simply drop out of the routes as they would not be able to compete on equal terms.A BA spokesman said of Delta’s demand: “There are some absurd suggestions out there but this one takes the biscuit. This is double the number of slots that competition authorities in Washington and Brussels have said should be relinquished and four times the number that the Office of Fair Trading says BA and American should be required to give up.
The tough line being taken by Delta, the biggest airline in the world based on passengers carried, is designed to put extra pressure on regulatory authorities on both sides of the Atlantic as the deadline looms for a final decision on the long-delayed alliance.The OFT recommended that BA and American relinquish 168 take off and landing slots at Heathrow a week as the condition for allowing the alliance to proceed. In that case there will be no open skies agreement either and no opening up of fortress Heathrow, the real goal for Delta and others.. Where the tactic risks coming unstuck is that if the authorities are encouraged to take too tough a line, BA and American will simply walk away. Delta Air Lines of the US, one of the leading opponents of the British Airways-American Airlines alliance, said yesterday that the tie-up should only be allowed to go ahead if the two carriers surrendered 50 round trips from Heathrow a day. But since the outcome of this particular dogfight does not look like being settled until well into the autumn, Delta has every incentive to maintain maximum pressure on the alliance partners and the competition authorities on either side of the Atlantic.

Delta Air Lines, which incidentally got its fingers badly burnt attempting a similar tie-up with Virgin Atlantic, wants its two rivals to surrender as many as 50 round trips a day from Heathrow as the price for regulatory approval.Pigs might fly, as they say. You are in a minority, after all.”Make things too tough and BA will walkAfter a break for the summer holidays, hostilities have been resumed in the war of words over British Airways’ planned alliance with American Airlines. OK, they didn’t really say quite that but they did concede that since my family is still the majority shareholder in Pentland, there’s not a lot they can do about it. I know this is bound to raise eyebrows in the City but I’ve never made any pretence that this is anything but a family company.

Anyway, Andrew is a Harvard MBA, so what more could you want?”I have absolutely no doubt that he is the right man for the job. It is entirely fortuitous that he just happens to be my son as well You’ll see I’ll be entirely vindicated within a few years And if you don’t like it, that’s your lookout. No, seriously, I’m really going to appoint him, but I did check it out with some leading institutions like the Pru first and they said it was perfectly all right. I’m not admitting failure, you understand, but I have to confess that we are not yet another Nike. So it is with great sadness and regret that I have decided to do the Cadbury correct thing and split the role of chairman and chief executive. I’ve never gone along with this kind of nonsense myself but I can understand why you blighters think it right and proper in publicly quoted companies.”Now the bad news Up yours! The new chief executive is to be my son, Andrew.

I am acutely aware that since my spectacular success with Reebok in the 1980s, our share price has gone nowhere. I’m told that we’ve underperformed the rest of the market by 40 per cent over the 1990s despite my best endeavours to build a new family of sports and leisure brands post the Reebok disposal. If he is to survive, he needs to be much clearer about what links this disparate rag bag of declining brands and why anyone would want to spend good money on trying to revive them. Mr Teare still has a mountain to climb persuading the City that Rank has a vibrant future ahead of it. Ho di ho!Pentland, this is your chairman speakingMessage to outside shareholders in Pentland Group from your chairman, Stephen Rubin.”First the good news.

Spraying money around on the group’s hotch potch of unrelated and unfocused leisure activities in the hope that one or some of them might come good is not much of a strategy. Under ambitious investment plans for the five Butlins holiday camps that remain, two of them are to lose the Butlins name entirely. Nonetheless, the pounds 139m planned investment in the other three is by any standards a massive gamble.Nobody doubts that there is anything but a huge market out there for the inexpensive British family holiday, but is a mixture of Haagen-Dazs Cafes, Burger Kings, Enid Blyton and Harry Ramsden fish and chips, all under “an impressive new weatherproof canopy structure”, really going to cater for it? Rank is confident the whole thing will meet its 15 per cent return on capital benchmark, but the City can hardly be blamed for scepticism.This could as easily be money down the drain as well invested and the move has rather highlighted growing doubts about what Mr Teare, now 18 months into the job, is trying to do with Rank. Unfortunately, instant brand recognition is not the only ingredient in business success, and today Butlins stands not for the time or your life, but for unemployment, social deprivation, tackiness and vulgarity.Is it really possible to reinvent for the 21st century a holiday concept born so unambiguously out of post-war austerity? Plainly even Andrew Teare, chief executive of the company’s parent, Rank Group, only partially believes so. In any other industry, such an inefficient state of affairs would have been resolved long ago by a rash of takeovers. Turkeys, though, do not vote for Christmas and until investors kick up more of a stink, there is little prospect of the sector’s very long tail shortening to a more reasonable length.Butlins move could be money down the drainWhat on earth do you do with a tired old brand like Butlins? This is a business with a special place in British social history.


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