<B> Startup Carriers Push To Allow More Foreign Capital</B>
By Jay Campbell
Startup airlines, business travel advocates and free marketers are arguing that the government would bolster airline competition and its customer benefits if foreign entities could invest in and own carriers here.
Proponents of relaxing the restrictions, which allow foreign ownership of 49 percent nonvoting equity and 25 percent voting shares, argue that the major airlines also will benefit from foreign investment, as some did in the early '90s.
As part of the debate over ownership and control at last month's Phoenix Aviation Symposium (see story, page one), among the most contentious issues was whether U.S. airlines need foreign capital.
While some more entrenched parties--such as labor unions and the major airlines--believe new capital is unnecessary, a new crop of airlines has sprung up and some are facing the possibility of being undercapitalized, one of the most likely causes of death for new carriers.
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