Devil Take the Hindmost

U.S. domestic airlines had clamored long and loudly for competition in international routes. Last week they got what they had been clamoring for. Powerful Pan American Airways Corp., an old hand at deflating competitors, announced that it was immediately cutting its passenger fare to Great Britain from $525 to Foynes to $275 all the way to London. It could do this, it said smoothly, because it was ready to start transatlantic service this week with Douglas DC-4s, faster and cheaper to operate than Clippers.

Pan Am's move was well-timed. American Airlines Inc. had already announced that its first transatlantic commercial flight, in a DC-4, would leave for London this week. Hastily, American tried to decide whether to drop its fare to meet Pan Am's rate. Transcontinental & Western Air, Inc., which could hardly wait to start transatlantic flying in DC-4s, suddenly cooled. It decided to postpone its Atlantic service until its fleet of highspeed, low-operating Constellations are delivered next month.

But Pan Am riled most tempers in Montreal. There the International Air Transport Association, with representatives of 44 airlines of 24 nations, was soberly discussing fare agreements to prevent cutthroat rate wars on international routes. They had just agreed to consult each other in fixing fares when Pan Am's bombshell exploded, disrupting discussions for a day. The baffled airmen felt that their cozy talk of fare fixing--and most thought Pan Am's new fare far too low--were just words in the teeth of a gale.

But at week's end the threat of a rate war settled down into an uneasy armistice. Pan Am confessed that its DC-4s were not quite ready, but hopes to start them this week. It put off its fare cut until they are ready to begin. Vastly relieved, American Airlines went ahead with preparations for its first flight--at the old rate of $572.

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