International Air Service

Since the 1940’s international air transportation has been subject to restrictive bilateral agreements that raise prices and artificially suppress aviation growth. DOT’s policy is to negotiate bilateral agreements to open international air travel to market forces, thereby removing limitations on the freedom of U.S. and foreign airlines to increase service, lower fares, and promote economic growth. These agreements have made it possible for the airline industry to provide better quality, lower priced, more competitive service for millions of passengers in thousands of international city-pair markets.

Performance Goal:

Increase the number of countries with which the United States has “open-skies” agreements and to increase the number of passengers that benefit from these agreements.

Performance measure:

Number of passengers (in millions) in international markets with open skies aviation agreements.

Target:

1999 2000 2001 2002 2003 2004

43.4 44.7 51.6 59.7 62.1 62.7

Actual:

49.4 56.8 56.4(r) 57.0#

(r) Revised; # Preliminary estimate.
International Markets with Open Skies Aviation Agreements

External Factors: Agreements to foster greater access are negotiated on a nation-by-nation basis, and must balance conflicting interests. Negotiating agreements and achieving passenger growth goals may be influenced by the strength of the world’s economy and by regional economic cycles.

Strategies and Initiatives to Achieve 2004 Target: DOT resources attributable to this performance goal are depicted below:

Funding for International Air Service

The domestic airline industry continues to undergo major changes, and international deregulation, which poses even more complex and controversial issues, is barely underway. Common to all of the aviation issues currently facing DOT is the need for in-depth and intensive analysis of practices, mergers, and international alliances. As the United States moves towards a multilateral approach to air service agreements, an understanding of long-term trends in the airline industry’s operating and competitive structures is required to formulate and execute effective negotiating strategies to ensure pro-competitive liberalization.

Other Federal Programs with Common Outcomes: The Department of State works with DOT in negotiations that support international aviation trade liberalization.