British Airways could make $235 million off AMR Alliance

The current recession has brought up heated debate around the world, as to if globalization is dead. After, what appeared to be a close call, the forces of globalization have regrouped and are stronger than ever. Recent evidence of this can be seen in the airline industry; where AMR's (the parent of American Airlines) One World Program received anti trust exemption not long ago from the U.S. Department of Transportation (U.S.D.O.T). This is important, because it allows the airline to form strategic alliances on the lucrative Trans Atlantic traffic. As a result, American has formed alliances with several key partners to fly into London's Heathrow Airport to include: British Airways, Finnair Oyj and Royal Jordanian Airlines. In return, all of the different airlines agreed to each give up one slot at London Heathrow Airport. While the U.S.D.O.T, agreed to offer similar anti trust immunities to Continental Airlines (with the Star Alliance) and Delta (with the Sky Miles Program). Under these different programs, the U.S.D.O.T, feels that such alliances would bring lower fares to consumers, which far outweigh any potential negatives.

What this shows, is that as the world is becoming smaller airlines are positioning to benefit from the increases in traffic. The way that they are positioning for this, is through a series of alliances, where each airline can be able to increase their overall profits. Over the course of time, these different alliances will more than likely compete with each other, to attract a wide variety of travelers.