US Airlines May Need Foreign Aid

May find security if caps on foreign investment are eased
By Jim O'Neill,  Newser User
Posted Jun 30, 2008 8:43 AM CDT
Continental Airlines planes taxi to the hanger in at Cleveland Hopkins International Airport in Cleveland, OH.   (AP Photo/Jason Miller)
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(Newser) – Troubled US airlines could be looking to Congress to ease foreign ownership laws, as financial woes push them into the arms of new investment partners, the Wall Street Journal reports. Overseas companies, barred from holding more than 25% of the voting stock of US carriers, are eager to relax the rules. "It could be the financial exigencies of the day that finally make for a breakthrough," British Airways Chairman Martin Broughton tells the Journal.

Lufthansa CEO Wolfgang Mayrhuber, whose company recently bought 19% of JetBlue, also sees US limits as "the biggest impediment" to effective globalization of the airline industry. "This industry shouldn't be treated like railroads," he says. "It should be like car makers or chemical companies" and operate globally. Broughton says the result of opening ownership would be "a handful of global airlines and a number of significant local operators." BA, of course, would be one of the former. (Read more British Airways stories.)