The Canadian Press - ONLINE EDITION

Transportation Department rejects exemption for low-cost air carrier to fly between US, Europe

  • Print

WASHINGTON - In a case that has labour and trade policy implications, the Obama administration on Tuesday rejected a request that would have immediately permitted a low-cost air carrier to begin flights between the U.S. and Europe while the government is still reviewing its application for new service.

The Transportation Department turned down a request by Norwegian Air International that would have allowed the carrier to offer new service between London's Gatwick Airport and New York, Orlando, Florida, and other U.S. cities. Officials for the airline said they hoped to charge as little as $150 each way. Such exemptions are usually granted European carriers under a U.S.-European Union aviation agreement.

Norwegian Air International is a subsidiary of Norwegian Air Shuttle, a low-cost carrier founded in 1993 and headquartered in Fornebu, Norway. The parent company has 417 routes to 126 destinations. Most of those routes are in Europe, North Africa and the Middle East, but it also flies some long-haul flights to the U.S. and Southeast Asia.

Its subsidiary, Norwegian Air International, plans to register its planes in Ireland, an EU member, to take advantage of the U.S.-EU treaty that extends many privileges granted domestic carriers to each other's airlines. That also would make Ireland responsible for the airline's safety oversight even though the carrier hasn't announced any plans to fly into or out of Ireland. The airline also plans to hire flight crews through a Singapore hiring agency and base them in Thailand.

U.S. airlines and pilot unions in the U.S. and Europe vigorously campaigned against the exemption, saying Norwegian Air International would set a dangerous precedent by driving down wages and undermining the ability of U.S. airlines to compete in the global market. Ed Wytkind, head of the AFL-CIO's Transportation Trades Department, recently accused Norwegian Air of trying to "usher in a Walmart-style race to the bottom for cheap labour."

Critics also questioned the ability of Irish authorities to safely oversee planes and pilots that are only available at distant locations. Dozens of members of Congress signed letters to the Transportation Department opposing the exemption.

Norwegian officials, however, have said the large airline mergers and establishment of global airline alliances in recent years have undermined competition and created great pent-up consumer demand for the cheaper air travel.

Norwegian Air Shuttle said in a statement that the Transportation Department's decision wouldn't affect its existing U.S. flights, and it urged the department to quickly approve its subsidiary's application.

Calling the case "novel and complex," Transportation Secretary Anthony Foxx said in a statement that the department doesn't believe the exemption "is appropriate or in the public interest."

But airline industry analyst Robert W. Mann Jr. said the opposition to Norwegian's proposal is "the business equivalent of Chicken Little and the sky is falling."

"This is no clear evidence of what people are concerned about actually having happened," he said.

___

Follow Joan Lowy on Twitter at http://www.twitter.com/AP_Joan_Lowy

Fact Check

Fact Check

Have you found an error, or know of something we’ve missed in one of our stories?
Please use the form below and let us know.

* Required
  • Please post the headline of the story or the title of the video with the error.

  • Please post exactly what was wrong with the story.

  • Please indicate your source for the correct information.

  • Yes

    No

  • This will only be used to contact you if we have a question about your submission, it will not be used to identify you or be published.

  • Cancel

Having problems with the form?

Contact Us Directly
  • Print

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

You can comment on most stories on winnipegfreepress.com. You can also agree or disagree with other comments. All you need to do is be a Winnipeg Free Press print or e-edition subscriber to join the conversation and give your feedback.

Have Your Say

New to commenting? Check out our Frequently Asked Questions.

Have Your Say

Comments are open to Winnipeg Free Press print or e-edition subscribers only. why?

Have Your Say

Comments are open to Winnipeg Free Press Subscribers only. why?

The Winnipeg Free Press does not necessarily endorse any of the views posted. By submitting your comment, you agree to our Terms and Conditions. These terms were revised effective April 16, 2010.

letters

Make text: Larger | Smaller

LATEST VIDEO

Key of Bart: Choose Yourself

View more like this

Photo Store Gallery

  • JOE BRYKSA/WINNIPEG FREE PRESS Local- A large osprey lands in it's nest in a hydro pole on Hyw 59  near the Hillside Beach turnoff turn off. Osprey a large narrow winged hawk which can have a wingspan of over 54 inches are making a incredible recovery since pesticide use of the 1950's and  1960's- For the last two decades these fish hawks have been reappearing in the Lake Winnipeg area- Aug 03, 2005
  • Someone or thing is taking advantage of the inactivity at Kapyong Barracks,hundreds of Canada Geese-See Joe Bryksa’s goose a day for 30 days challenge- Day 15- May 22, 2012   (JOE BRYKSA / WINNIPEG FREE PRESS)

View More Gallery Photos

Poll

Should Premier Greg Selinger resign?

View Results

View Related Story

Ads by Google