If they don’t get a deal with the labour force, the value will diminish even further,” said Thomas Longman of Lehman Brothers.Meanwhile, the resumption of talks aimed at liberalising airline links between Britain and the United States, which were expected to start in London yesterday, was postponed until next week at the earliest.Division amongst US airlines on what proposals US officials should bring to the negotiating table was blamed for the delay.The US team was expected to bring proposals for a new deal to break the deadlock after nearly four years of trying to get a totally free “open skies” market for air travel between the two countries.The US side may offer to drop its “Fly the Flag” policy banning American civil servants from using foreign airlines for transatlantic travel.US airlines are determined that any new agreement must allow them to fly extra routes out of London Heathrow, rather than the capital’s other two airports at Gatwick and Stansted, which offer fewer onward connections.. “This is not currently the position although it is of course regularly reviewed,” the company said.Sir Colin said he was heartened that USAir was still negotiating for a cost-cutting deal with its employees and said the company had embarked on a rationalisation of its fleet and route network.But Mr Buffett’s action has dented confidence in USAir “Everybody’s investment in this company has been diminished. BA said it would only write down the value of its investment if it believed there had been a permanent diminution in the book value. State owned airlines had wasted “colossal sums of their taxpayers’ money”, Sir Colin said.The remarks came as BA repeated that it would not write down the value of its holding in troubled USAir.On Monday Warren Buffett, the American investor, wrote down his $268m investment in the company and said he would resign from the board. State aid to Air France, Alitalia and Iberia was a waste of millions of pounds of taxpayers’ money while undermining the profitability of BA, he told a conference in Australia.
The lack of market discipline distorted competition for private airlines which had survived without government handouts.

Sir Colin Marshall, chairman of British Airways, launched a bitter attack on airline subsidies yesterday, as the company continued to resist pressure to write down its £260m stake in USAir, writes Russell Hotten. The Commission scrutinises such deals to ensure they do not amount to illegal subsidies to prop up ailing companies.Mr Alphandery told Mr Van Miert that the deal would involve the bank divesting some parts of its operations, which would assuage Commission concerns.”We agreed on this approach, on the principle that Credit Lyonnais should be stripped of a considerable part of its assets,” Mr Van Miert said.Officials said that important information would be provided by the French government over the next few days, and the investigation would continue.. “The French government, the principal shareholder in Crdit Lyonnais, seems to us to be adopting the right approach,” Mr Van Miert added.France plans to bail out the state-controlled bank by guaranteeing assets that will be spun off into a separate vehicle.The bank’s competitors charge that this amounts to a cash injection, though it will not involve any new money for Crdit Lyonnais. Commission officials underlined that their investigation would not be closed, but indicated that the meeting had gone well. But Karel Van Miert, the Commissioner for Competition, said yesterday that a meeting with Mr Alphandery had removed important doubts over the package.”We have a very similiar approach to this dossier,” he said. “It’s moving in the right direction,” an official said.The deal has been heavily criticised by the bank’s competitors in France. “Credit Lyonnais has the means to deal with this,” he said.The rescue package looks more likely to go ahead after the European Commission said yesterday that some of its key concerns had been assuaged.

Speaking in a television interview, Mr Alphandery said “There appears to have been embezzlement.”With the government poised to present a second rescue plan for the bank, Mr Alphandery said French taxpayers would not be asked to foot the bill. The order marked the first time French officials have mentioned possible criminal activity in the Credit Lyonnais debacle.
The Economics Minister, Edmond Alphandery, told French television that the bank’s accumulated losses were around Fr50bn (£6bn). The French Prime Minister, Edouard Balladur, yesterday ordered a probe into possible fraud at Credit Lyonnais, as huge new losses were revealed at the troubled state-owned bank. The results in 1993 were dramatically affected by an over-sale of advertising time, which obliged the company to repay advertisers .YTT has since cut 1,700 jobs to create a “core” team to lower costs.. YTT set the fee, £54m per year, to win the licence in 1991, but Mr Thomas now argues that the process was “flawed”.