BA denies secret pact with JAL
War has broken out again between Virgin Atlantic Airways chairman Richard Branson and British Airways (BA) boss Robert Ayling, with Mr Branson accusing BA of signing a secret pact with Japan Airlines (JAL) to allow them to control up to 80 per cent of London-Tokyo traffic.
The two arch-rivals were in Hong Kong yesterday at different functions but took the opportunity to resume a feisty business and personal relationship that has moved from the papers to the courtrooms in recent years, Mr Branson said officials from Japan's Ministry of Transport had approved the agreement while Virgin had sent a protesting letter to Britain's Office of Fair Trading.
BA had hushed up the JAL deal to avoid disrupting regulatory clearance for its transatlantic alliance with American Airlines, he said.
'They have kept it secret so that regulators don't take it into account when they consider the BA-American Airlines deal,' he said.
BA chief executive Ayling denied a deal with JAL had been reached. 'Neither an agreement nor negotiations have been entered,' he said.
Suggestions by Mr Branson that BA had secured a secret pact with Dutch carrier KLM were also incorrect, Mr Ayling said.
Both airline bosses were ostensibly in Hong Kong on routine business trips when Mr Branson again launched invectives against the proposed BA-American Airlines alliance.
'We accept that chairman of airlines will try to build cartels restricting competition,' he said. 'It is up to governments to stop them.' Mr Ayling said: 'We have made no secret of the fact that we are trying to develop a global alliance.
'We have made an agreement with American Airlines. We have no agreement with anyone else.' Obtaining landing spots at Shanghai airport continues to elude both BA and Virgin.
Mr Ayling said ongoing Sino-British government negotiations should open the way to Shanghai slots.
Virgin was holding talks to obtain an equity stake in a Shanghai-based mainland airline that would make the approval of landing rights 'more palatable to Chinese authorities', Mr Branson said.
