British Airways in talks with American, Continental for trans-Atlantic alliance

01 May 2008

London/New York: British Airways (BA) issued a statement yesterday which announced that it was "exploring opportunities for cooperation with American Airlines and Continental Airlines." The statement also said that "further details will be announced when appropriate."

Such ''cooperation'' would create a powerful alliance in what the airlines industry recognises is a very lucrative trans-Atlantic market. American is by far the world's biggest airline by traffic, while Continental is the fourth largest carrier in the US.

BA's announcement comes even as the airline industry undergoes a period of great turmoil with bankruptcies, mergers and alliances forming the stuff of daily headlines. Over the weekend Continental declined an offer to merge with United Airlines.

AMR Corp-owned American Airlines, meanwhile, confirmed that it was in talks with BA, though Continental is yet to do so.

Industry analysts say such alliances have the potential to help airlines streamline costs while sharing revenues.