16 -
That
a daily service was the only real way to compete with BA, he did add that, as a businessman, Sir Freddie would tailor his service to what the market would support. may be so but we think that, if all four carriers were
unrestricted, the competitive edge of offering a daily service would be irresistable to all and mutually destructive.
35.
The Secretary of State in announcing his decision
said he was satisfied on the evidence that all four
operators could, over a period, make a reasonable profit. He did not, however, specify exactly what was that evidence
on which he relied and even more important, did not say what that period might be. The Authority shares the view
that eventually the route will increase very substantially
but on the evidence does not consider it will be as dramatic
an increase as Sir Freddie Laker predicts.
36.
To rely on the market alone to prevent uneconomic overlapping seems to the Authority to amount to total de- regulation. It would be difficult then to refuse any applicant for any route who, being a reputable carrier, applied for it. The Authority was told by the Attorney
General last November that this was not a proper approach
and it shares that view now as it did then. The business
of operating an airline is one not entered into lightly if the operator is responsible. The capital commitment is vast and the potential profits depend on accurate long term forward planning. A great deal of money must be invested in promotion as well as in buying equipment and the Authority feels that some degree of regulation is in the public interest so as to ensure stability in the industry and orderly development. We agree with the argument that unless it can be shown that our earlier decision was wrong or that circumstances have greatly changed, we should be slow to alter a decision on which existing operators have relied in making major planning decisions involving such
large sums of money.
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