Pan American World Airways President Dan A. Colussy charged today U.S. government policies are putting U.S. flag airlines on "the endangered species list.
"Our frustrations come about mainly from situations where we find our own government as our principal adversary actually preventing us from taking sensible actions," Colussy complained in a strongly worded speech to an international aviation conference sponsored by Lloyd's of London Press. "This is especially true in the international arena where . . . we seem to continually find ourselves dealing with U.S. government policies which not only work against our future success but actually help our foreign competitors succeed against us."
Colussy said the main problem is the flag airlines' inability to pass through jet fuel increases quickly into higher international air fares. In the "lag time," Colussy said the U.S. carriers are losing millions of dollars. The result is a lack of profitability that will not enable them to replace old airplanes with new ones, he said.
Colussy said Pan Am yesterday asked the Civil Aeronautics Board for permission to raise fares immediately by up to 10 percent on all international routes without any CAB interference.
For Pan Am's woes, Colussy also blamed the United States' procompetive international aviation policy. He attacked the U.S. government for granting foreign airlines new routes to the United States in return for fare reduction promises and the ability to name new U.S. airlines to foreign points. "This means that several new U.S. carriers must fight over a fragmented market while the foreign carrier has the sole rights from his country to several U.S. lucrative markets," he said.
(Colussy did not mention the U.S. recently reached a new agreement with Great Britian that restored to Pan Am a lucrative Miami-London route it would have lost and also gave Pan Am and Trans World Airlines a perpetual shared monopoly on U.S. airline service to popular Heathrow Airport with its valuable connecting flight opportunities.)
In contrast to Colussy's view that U.S. international aviation policies are hurting U.S. carriers, the officials of foreign airlines represented here generally argued U.S. policies did aid the already more efficient U.S. airlines to the disadvantage of the foreign carriers.
Following Colussy, B. Boyd Hight, deputy assistant secretary of State for transportation affairs, responded he believed that profitable U.S. airlines are essential to the success of of U.S. deregulation policy. Noting conditions that had spawned unparalleled growth of the airline industry since World War II -- technological advances, cheap fuel and consumers with more discretionary income -- were over, he urged the industry to question anew the growth assumptions that have been standard in the past.
In a luncheon address, CAB chairman Marvin S. Cohen agreed 1979 was not a banner year for U.S. airlines operating across the Atlantic, compared with the two prior years of growth. But he noted there were only four years in the last decade where U.S. carriers as a group did better than they did in 1979. Nevertheless, he said "we all would agree that financial returns like these are unacceptable over the long term."
On Colussy's complaints about fare approval lag time, Cohen said, the board was concerned about it and was studying it.
But like Hight, Cohen warned there is a fundamental question about whether the air transportation system could continue "in the traditional mold." w