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Time - Man of the Year
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Time_Man_of_the_Year_Compact_Publishing_3YX-Disc-1_Compact_Publishing_1993.iso
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1993-04-08
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THE WEEKBUSINESS, Page 22Over to You
Washington's approval of an airline deal invites foreign carriers
to reciprocate
Just maybe, there is a cease-fire in the global air wars. As a
first step toward easing transatlantic tensions, the U.S.
Department of Transportation has tentatively approved the
proposed merger of Northwest and KLM Royal Dutch airlines. The
endorsement comes as Washington and European countries spar over
"open skies" agreements. Britain, for instance, is pressing the
U.S. to okay a proposed alliance between British Airways and
USAir. The Americans are also squabbling with France and Germany
over airport landing rights. U.S. airlines have generally
opposed making any concessions unless European countries
reciprocate by opening their markets to American carriers. By
giving the green light to KLM, Washington is hoping the
Europeans will make the next move and return the favor.
If the KLM-Northwest deal flies, it would mark the first
time in the U.S. that a foreign and a domestic airline would be
allowed to function as one company. KLM and NW will consolidate
their fleets, fare structures and sales forces. But the merger
may be too little, too late for financially troubled NW, which
is struggling to avoid bankruptcy. Meanwhile, the U.S. airline
industry remains a dangerous battleground. MGM Grand Air, a
three-year-old luxury carrier, withdrew from scheduled
passenger service last week after it failed to stem financial
losses.