Virgin America, Richard Branson's would-be American airline, has been trying to get the Department of Transportation's OK for a year. But federal law says domestic airlines must be controlled by Americans, and competitors have been bitching about Branson's Britishness. Today the DOT officially rejected the airline's application, saying Virgin would have to restructure or forget the idea. The San Francisco Chronicle points out that Branson wins either way: If he gives up, he'll increase the chances that Britain will keep American airlines out of European markets. If Branson doesn't get an American airline to play with, he does get to stave off competition at Heathrow and elsewhere. Not that there won't be losers:
Here's what else American carriers are TKO'ing, just so that they can reduce their own competition and fully enjoy next year's expected 3-7 percent fare increase—approximately 3,000 new jobs (1,600 of them in the Bay Area). Between $5 million and $10 million a year in Bay Area spending for Virgin America's headquarters. Some $24 million in state and local taxes. The consumer's convenience of having a low-cost carrier at San Francisco International Airport. The world's first environmentally-conscious carrier plan—Virgin America wanted to tow its planes from the gate to the runway to save fuel, and it planned to buy from the new generation of quieter, more fuel-efficient planes. Our dear American carriers have so far resisted these planes because of the costs.
The well-traveled, much-missed Matt Welch tracked the transformation of Europe's skyways last year.