Airlines: Leaving Their Dollars

AIRLINES Leaving Their Dollars President Johnson’s proposed travel tax would hurt all airlines that fly be tween the U.S. and Europe. But it figures to work a special hardship on foreign carriers, since they currently handle 60% of all transatlantic traffic.

In an effort to build good will with potential American passengers, West Germany’s Lufthansa airline last week pledged to do its bit to combat the U.S. balance of payments problem. “Effective immediately,” the airline announced, “Lufthansa will keep all dollar revenues in the U.S.A.”

The policy, described in full-page newspaper advertisements in the U.S., would affect “every cent of every dollar in revenue earned by Lufthansa in the U.S.” Pledging that “all such revenues will be used exclusively for expenditures in the U.S.,” Lufthansa went on to make it clear that most of the money would go for additions to me airline’s intercontinental fleet, which consists entirely of U.S.-made Boeing aircraft. “Lufthansa,” concluded the airline’s advertisement, “has spent more than $550 million on American-built aircraft alone—and has already contracted for future delivery of over $130 million in American-built aircraft.”

Like Lufthansa, other foreign airlines are also taking pains to publicize their expenditures in the U.S. Spain’s Iberia Air Lines, for example, has run U.S. newspaper ads that ask: “We buy your planes. Shouldn’t you fly ours?” And this week Italy’s Alitalia plans a similar ad, pointing out that its aircraft purchases and operating expenses in the U.S. will amount to some $1 billion by 1975.