NWA flights to Heathrow well booked despite cost

Northwest Airlines on Saturday will launch service between the Twin Cities and London's Heathrow Airport after a new "open skies" agreement between the United States and the European Union opens that busy airport to more carriers.

The flight from the Twin Cities to Heathrow will replace Northwest's daily flight to Gatwick Airport, which is farther from central London. The airline will continue to operate a 298-seat Airbus A330-300 on the London route.

This spring, Northwest also will inaugurate nonstop service between the Twin Cities and Paris. That daily flight will begin on April 8 and also will be operated with an Airbus A330.

Despite round-trip fuel surcharges that have risen to $230 on European trips, Laura Liu, Northwest's senior vice president of international service, said that Northwest's international bookings remain solid.

"This is a fairly new phenomenon, that business travel to international destinations is not being severely impacted by big economic issues in the U.S.," Liu said in an interview.

Because so many U.S.-based companies are pursuing a global business strategy, Liu said large Twin Cities-area companies still send people overseas despite higher fares and fuel surcharges. Minnesota has more Fortune 500 headquarters companies per capita than any other state.

Dale Eastlund, a Carlson Wagonlit Travel executive based in Minnetonka, agrees. "We haven't seen corporations cut back on that travel" to international destinations, he said. But Eastlund noted that it's early in the year.

If oil prices -- now more than $100 per barrel -- push fares and fuel surcharges to exceedingly high levels throughout 2008, he said, "that third and fourth quarter will be a different story."

If companies expect to exceed their travel budgets, Eastlund said he anticipates cutting later in the year.

Northwest currently adds a $115 fuel surcharge each way on all transatlantic fares (and $135 for all transpacific flights) on tickets that are booked now. The price for a round-trip direct coach flight to London's Heathrow Airport in mid-July is about $1,309, including the fuel surcharge and other charges, if booked now. A similar flight to Paris would be about $1,535 if booked now.

Many corporate customers in Minnesota are glad to be getting nonstop service to London Heathrow, Eastlund said. They viewed the Gatwick service as "cumbersome" because travelers had to "take a half-hour train ride from Gatwick into London proper," he added. Heathrow is closer to the London business district.

Liu said leisure travelers are moving into the period in which they'll book summer travel to London. At this stage, she said, Northwest has not been discounting fares to boost their interest.

"We have always had, in the summertime, more demand than we can carry to Europe," Liu said.

Antitrust immunity sought

In October, when Northwest CEO Doug Steenland announced that Paris service would begin this spring, he said: "We've taken a bit of a leap of faith." That's because Steenland said it's critical for Northwest to obtain antitrust immunity from federal regulators so it can coordinate pricing and schedules with Air France.

Northwest has had a joint-venture with KLM Royal Dutch Airlines for several years, which allows it to function as one company for its transatlantic flying.

Liu said this week that Northwest executives are disappointed that the application for a four-way antitrust immunity is still pending. Northwest, KLM, Air France and Delta Air Lines want to be able to coordinate their transatlantic operations.

"We are flying deep into Air France's home territory, so we really need their cooperation. When this flight launches, we are competing with Air France," Liu said.

Ben Hirst, Northwest's general counsel, said Northwest had expected the U.S. Department of Transportation to approve the antitrust application by now. Hirst expressed confidence that the regulators will permit the cooperation, but he did not speculate on when.

"To some degree, it's a bold move on the company's part to go ahead with the route in advance of it," Hirst said.

Meanwhile, other Twin Cities business leaders are engaged in stimulating more travel between the Twin Cities and Paris. Amy Lewis, director of sales and marketing at the Sofitel Minneapolis hotel in Bloomington, said she's working with the convention and visitors bureau in Bloomington to bring French travel planners, agents and writers to the Twin Cities.

Lewis wants to expose Paris travel industry professionals to what the Twin Cities has to offer.

"Through Air France, we are promoting Minneapolis pretty aggressively," Hirst said, including information about cultural offerings such as the Walker Art Center. Northwest, KLM, Air France and Delta all belong to the international SkyTeam alliance.

Liz Fedor • 612-673-7709