International Aviation

Foreign markets have become increasingly important to the bottom lines of U.S. airlines. The success of U.S. airlines in these markets is limited, however, because of extensive access restrictions and many operating and market impediments. In attempting to lower these barriers, the Transportation Department (DOT) has adopted an "open skies" approach. It is apparent, however, that a truly open skies environment is unlikely in the foreseeable future. GAO believes that DOT needs to adopt a strategic approach that better uses its substantial leverage--greater access to the world's largest aviation market--to induce foreign countries to open their markets. A more strategic approach should include (1) better analysis by DOT of long-term competitive impacts before reaching agreements with foreign governments or making major policy decisions, (2) improved analyses by identifying code-share flights in its traffic data, (3) more expertise and experience in international aviation at the State Department, and (4) a review of the existing policies that severely restrict the participation of U.S. passenger and cargo airlines and other parties in bilateral negotiations.