In Business This Week
FRANCE MOVES TO KEEP U.S. AIRLINES IN CHECK
France has followed through on its earlier threat: On May 4, the country renounced its bilateral air agreement with the U.S., in effect since 1946. The move capped a long-simmering dispute between the two countries over the number of seats U.S. airlines can offer travelers to and from France.
For this summer, France will let U.S. carriers increase seat capacity by 26% over last year, to 2.4 million seats. But a new treaty may put a lid on the number of seats that can be offered by the eight U.S. airlines flying between the two countries and may restrict the number of countries that U.S. airlines can serve after stopping in France. Now, the airline industry is worried that other countries, such as Germany or Japan, may follow France's lead and try to curtail the expansion plans of U.S. carriers.EDITED BY HARRIS COLLINGWOOD