WASHINGTON -- The Transportation Department ruled that the
Russian Federation is discriminating against United Airlines and
violating the terms of the U.S.-Russia air agreement by preventing
the United-Lufthansa alliance from offering a code-share service to
Russia via Germany.
Invoking an aviation fair-competition statute, the DOT said
Russia's refusal to permit the service warrants the imposition of
sanctions on Aeroflot or other Russian carriers, but it said it
wants to "resolve this dispute diplomatically" and deferred the
issue of sanctions, pending talks with Russia.
In other actions at the DOT:
Continental advised the department that it is "finalizing plans
to inaugurate daily nonstop Cleveland-London service," though it
offered no firm start-up date. Continental received the route
rights in 1996 and wants to renew them while it continues its
preparations.Baltia Airlines, a nonoperating airline with route rights to
Russia, again asked to extend its deadline for starting service as
it tries to secure financing.The company, which began its quest in 1990, received New
York-St. Petersburg route rights in February 1996 with a "use it or
lose it" provision that has been extended twice.
The city of Fergus Falls, Minn., is back on the airline route
map. The DOT approved a $1 million subsidy for Great Lakes aviation
to resume United Express service linking Fergus Falls to
Minneapolis, 175 miles away.The DOT is picking up 75% of the tab, and state and local
authorities are covering the rest.
The service is expected to attract 6,800 passengers a year,
which would work out to a subsidy of about $145 per passenger. The
one-way fare is expected to be $55.
Fergus Falls, a community of 13,000 that is about 55 miles from
the airport at Fargo, N.D., is one of only two cities added to the
essential air-service subsidy program under a 1987 law that allowed
new points to be added in certain cases.