LV continues quest for London flights

For the tourism executives who have lobbied British aviation authorities for direct air service between London and Las Vegas, last week's rejection of a Virgin Atlantic Airways proposal was considered the loss of a battle, but not the war.

Great Britain's Civil Aviation Authority approved British Airways' plan for non-stop daily service between London's Gatwick Airport and Denver International Airport. In choosing that bid, the agency -- the British equivalent of America's Federal Aviation Administration -- rejected Virgin Atlantic's plan to provide twice-a-week service to Las Vegas.

British Airways said it would initiate non-stop service to Denver in June aboard new Boeing 777 jets.

Under a bilateral agreement between the United States and Great Britain, a limited number of routes between the two nations is allowed. The CAA had to choose between the bids of the bitter-rival companies.

There's clearly no love lost between British Airways and Virgin Atlantic. In a reference to British Airways' proposed strategic alliance with Dallas-based American Airlines, Virgin Atlantic painted its planes with anti-British Airways slogans.

In its press release announcing the Denver bid approval, British Airways scoffed at Virgin Atlantic's proposal as "a last-minute application." In describing prospective passengers in the CAA hearing, British Airways said Colorado consumers are better educated than Nevada's.

British Airways, which calls itself "the world's favourite airline," travels to 174 destinations in 83 countries. Virgin Atlantic, which views itself as the maverick upstart, serves 25 cities on five continents, including seven cities in the United States.

In the wake of the CAA decision, Virgin Atlantic and McCarran International Airport officials are analyzing what went wrong and whether they can appeal the decision.

Establishing a direct route between Las Vegas and London is important to McCarran and lobbying partners at the Las Vegas Convention and Visitors Authority because of a heightened interest in drawing international travelers to fill the city's growing hotel room inventory. Convention and international traffic more readily fills rooms in the slow midweek periods.

"This is just one setback," said Harry Kassap, manager of air service development at McCarran International Airport. "The battle isn't over."

Kassap said he's waiting to hear exactly what Virgin Atlantic plans to do and support its efforts.

Virgin Atlantic's plans aren't clear just yet.

"We're looking at options of an appeal," said Gareth Edmondson-Jones, manager of industry and public affairs for Virgin Atlantic in Norwalk, Conn. "It's an unusual thing to have to do, since it's so rare that a route pick comes up."

Both Edmondson-Jones and Kassap are in agreement that the CAA's decision appeared to be based on the frequency of flights offered in the British Airways proposal.

"It's what we feared it would be," said Kassap. "It was based on seven-day service by British Airways vs. Virgin for two days a week."

Kassap said the agency apparently wasn't convinced by Virgin Atlantic Chief Executive Officer Richard Branson's promise that higher-frequency flights would occur soon after the service start-up when additional planes would become available to his company.

Edmondson-Jones said the appeal process in the case probably would come in the form of discussions with John Prescott, a deputy prime minister who oversees transportation issues in the British government.

One of the issues that could come up: the apparent inconsistency of granting British Airways the route based on flight frequency while the airline uses the same limited-frequency strategy in its London-Tampa route.

In addition, the status of an "open-skies" agreement that would allow any British carrier to serve American cities and American carriers to fly into Britain may be considered. Kassap believes the European Commission will review open-skies pacts sometime next year.

Neither Kassap nor Edmondson-Jones believes the CAA's decision was based on the viability of the markets involved. Edmondson-Jones said that while Denver's market is more than twice as large as Las Vegas and it's the largest American city without direct service to London, the agency didn't consider passenger volumes going to London. The decision was based, instead, on the British traveling public's consumer interests, he said.

British Airways officials disagree. The fact that there is a bigger market from which to draw and that there's a clear mix of business and leisure travelers that could visit London from Denver bolstered the British Airways bid, a New York-based company official said.

"There was more in it for the Brits," British Airways spokesman John Lampl said of his company's proposal. "Most people thought Virgin Atlantic would have had a stronger case had they offered daily service to Las Vegas."

Kassap said British Airways officials commented during testimony before the CAA that Colorado residents were more educated consumers than Nevadans and would be more likely to travel overseas, a remark that left the Las Vegas delegation bristling. The company also said even without a direct route, 50 percent more passengers travel to Denver than Las Vegas from London. Kassap said those statistics are flawed because many overseas travelers arrive in Las Vegas on Southwest Airlines, which doesn't have partnerships with other carriers.

While British Airways and Denver officials sold their proposal as an opportunity to serve both business and leisure travelers, the Las Vegas route was portrayed as strictly a recreational market. Denver also was touted as a gateway to Rocky Mountain ski resorts.

Las Vegas officials countered that the Virgin Atlantic proposal had more potential for growth than the British Airways plan. They also pitched Las Vegas as an alternative gateway to the West Coast, far less crowded than Los Angeles and San Francisco.

"There's far more growth potential here," said Kassap. "In virtually every category, we dwarf them (Denver). But the board was thinking in the short term in this case and the daily service to Denver was something that was being offered immediately."

Lampl said he expects Las Vegas will get non-stop service to London within a year.

He pointed out that through a code-sharing agreement with America West Airlines one-stop service to London exists on British Airways through Phoenix.

"In fact, if you go down to the America West ticket counter at McCarran, you'll see a big British Airways sign," said Lampl. "It's the easiest way to get to London from Las Vegas."

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