1. Commerce Affected

2. London Is Almost 3 Times Larger Than the Next Largest U.S. – Transatlantic Market, and Is Bigger Than the Next 3 Largest Markets Combined London (LHR/LGW) Paris (CDG) Frankfurt Amsterdam Zurich Munich Brussels Vienna Copenhagen 9,379,754 3,378,941 2,971,676 1,937,387 1,153,698 1,144,083 866,883 489,866 420,005 -- 2.8 3.2 4.8 8.1 8.2 10.8 19.1 22.3 O&D Traffic Times London Larger Exhibit NW-1 Source: Based on MIDT: True O&D Bookings – Year Ended April 2001

3. The U.S. – London (LHR/LGW) Market Is Larger Than the Entire U.S. – Germany Market and the Entire U.S. – France Market U.S. - London U.S. – Germany U.S. - France Millions of Annual Passengers Exhibit NW-2 Source: Based on MIDT: True O&D Bookings – Year Ended April 2001

4. The Seven Nonstop Overlap U.S. – London Heathrow (LHR) Markets Represent 60.7% of U.S. – Heathrow Annual Passengers U.S. – London Heathrow Total Passengers 6,096,963 7 Overlap Markets 3,699,495 * Percent of Total60.7% U.S. – London Heathrow Total Passengers 6,096,963 7 Overlap Markets 3,699,495 * Percent of Total60.7% Passengers Per Year (000) Source: Based on MIDT: True O&D Bookings – Year Ended April 2001 * DFW – London Service, since DFW does not have nonstop Heathrow service. * Exhibit NW-3

5. The Seven Nonstop Overlap U.S. – London Heathrow* (LHR) Markets Account for Almost $3.9 Billion and Represent 74.7% Total Annual U.S. – Heathrow Revenues Per Year Revenue Per Year ($ Millions) Source: DOT O&D Survey Year End 2000; MIDT: True O&D Bookings Data, Year Ended April 2001 U.S. – Heathrow Revenue ($mil) Total Revenue 5,203 7 Overlap Markets 3,886 ** Percent of Total74.7% U.S. – Heathrow Revenue ($mil) Total Revenue 5,203 7 Overlap Markets 3,886 ** Percent of Total74.7% * * DFW – London Service, since DFW does not have nonstop Heathrow service. ** Individual market revenues do not tie to the 7 overlap market total due to rounding. Exhibit NW-4

6. The Seven Overlap U.S. – Heathrow Markets Are 12 Times Larger Than The Overlap Routes Analyzed in the United (UA)/ Lufthansa (LH) Antitrust Immunity Application UA/LH Millions of Passengers AA/BA * Includes DFW – Gatwick Service, since DFW does not have Heathrow service. * Exhibit NW-5 Source: Based on MIDT: True O&D Bookings – Year Ended April 2001

7. The Seven Overlap U.S. – Heathrow Routes Are Twice As Large As the United (UA)/US Airways (US) Nonstop Overlap Routes That Prompted a DOJ Announced Court Challenge UA/US ** AA/BA * $ Billions * DOT O&D Survey 2000; MIDT: True O&D Bookings Data, Year Ended April 2001 ** DOJ Press Release, July 27, 2001 Exhibit NW-6

8. The Seven Overlap U.S. – Heathrow Routes Are Over Ten Times Larger Than the Northwest (NW)/Continental (CO) Routes That Prompted a DOJ Court Challenge NW/CO ** AA/BA * $ Billions * DOT O&D Survey 2000; MIDT: True O&D Bookings Data, Year Ended April 2001 ** DOJ Press Release, October 23, 1998 Exhibit NW-7

9. Heathrow Preference

10. Based on DOT Data, Different Passenger Mix at LHR versus LGW Results in Average Round Trip Fares Between the U.S. and London That Are 31% Higher at Heathrow Than at Gatwick London Heathrow Average Fare $ Source: DOT O&D Survey 2000 London Gatwick Exhibit NW-8

11. According to British Airways, Its Unit Revenues for London Heathrow (LHR) Services Are 15% Higher Than Unit Revenues at Gatwick (LGW) “Where does the value come from for the shareholder from this new strategy? On the longhaul side, the value comes from having a higher proportion of our network at Heathrow, where we make of the order of 15% higher unit revenues.” -- Robert Boyle, British Airways General Manager Network Planning, British Airways Investors Day, Network, page 14. Exhibit NW-9

12. Virtually No U.S. – London Traffic Connects Over Other European Gateways Source: MIDT: True O&D Bookings – Year Ended April 2001 London Gatwick London Heathrow Frankfurt Paris (CDG) Brussels Amsterdam Zurich Munich Vienna Copenhagen 3,412,635 5,967,119 2,971,676 3,378,941 866,883 1,937,387 1,153,698 1,144,083 489,866 420,005 0% 3% 10% 11% 17% 21% 40% 65% 66% O&D Passengers Percent Connecting Over Other European Point U.S.-European Point Exhibit NW-10

13. Connecting Service to London Heathrow (LHR) via Other European Gateways Imposes a Substantial Time Penalty on U.S. – Heathrow Passengers * * * * * * * * Connection times had to be manually constructed – each trip required three stops Source: Official Airline Guide, September 2001 Exhibit NW-11

14. Market Power

15. HHI Index of Frequencies 240 HHI points over highly concentrated threshold 240 HHI points over highly concentrated threshold Increase of 1,287 HHI points – 12 times the DOJ 100 point threshold Increase of 1,287 HHI points – 12 times the DOJ 100 point threshold Highly Concentrated Threshold After Merger AA/BA Control 53.5% of the Weekly Frequencies (W.F.) in the U.S. – London (LHR/LGW) Market U.S. - London (LHR/LGW) Frequencies The Overall U.S. – London (LHR/LGW) Market Is Already Highly Concentrated. The AA/BA Alliance Would Produce an Increase in Concentration 12 Times Greater Than the DOJ Threshold for the Presumption of Market Power DOJ Definition of Highly Concentrated Market Pre-Merger Concentration Post-Merger Concentration Source: Official Airline Guide – September 2001 231 (W.F.)409 (W.F.) 125 (W.F.) Total Weekly Frequencies = 765 Exhibit NW-12

16. HHI Index of Frequencies 859 HHI points over highly concentrated threshold 859 HHI points over highly concentrated threshold Increase of 1,729 HHI points – 17 times the DOJ 100 point threshold Increase of 1,729 HHI points – 17 times the DOJ 100 point threshold Highly Concentrated Threshold After Merger AA/BA Control 61.0% of the Weekly Frequencies (W.F.) in the U.S. – London Heathrow (LHR) Market U.S. - London Heathrow (LHR) Frequencies The Overall U.S. – London Heathrow (LHR) Market Is Already Highly Concentrated. The AA/BA Alliance Would Produce an Increase in Concentration 17 Times Greater Than the DOJ Threshold for the Presumption of Market Power DOJ Definition of Highly Concentrated Market Pre-Merger Concentration Post-Merger Concentration 112 (W.F.) 305 (W.F.) 83 (W.F.) Total Weekly Frequencies = 500 Source: Official Airline Guide – September 2001 Exhibit NW-13

17. HHI Index of Frequencies 891 HHI points over highly concentrated threshold 891 HHI points over highly concentrated threshold Increase of 2,140 HHI points – 21 times the DOJ 100 point threshold Increase of 2,140 HHI points – 21 times the DOJ 100 point threshold Highly Concentrated Threshold After Merger AA/BA Control 66.7% of the Weekly Frequencies (W.F.) in the New York (JFK) – London (LHR/LGW) Market New York (JFK) - London (LHR/LGW) Frequencies The New York (JFK) – London (LHR/LGW) Market Is Already Highly Concentrated. The AA/BA Alliance Would Produce an Increase in Concentration 21 Times Greater Than the DOJ Threshold for the Presumption of Market Power DOJ Definition of Highly Concentrated Market Pre-Merger Concentration Post-Merger Concentration 31 (W.F.) 104 (W.F.) 21 (W.F.) Total Weekly Frequencies = 156 Source: Official Airline Guide – September 2001 Exhibit NW-14

18. HHI Index of Frequencies 781 HHI points over highly concentrated threshold 781 HHI points over highly concentrated threshold Increase of 2,081 HHI points – 20 times the DOJ 100 point threshold Increase of 2,081 HHI points – 20 times the DOJ 100 point threshold Highly Concentrated Threshold After Merger AA/BA Control 65.1% of the Weekly Frequencies (W.F.) in the New York (JFK) – London Heathrow (LHR) Market New York (JFK) - London Heathrow (LHR) Frequencies The New York (JFK) – London Heathrow (LHR) Market Is Already Highly Concentrated. The AA/BA Alliance Would Produce an Increase in Concentration 20 Times Greater Than the DOJ Threshold for the Presumption of Market Power Pre-Merger Concentration Post-Merger Concentration DOJ Definition of Highly Concentrated Market 97 (W.F.) 21 (W.F.) Total Weekly Frequencies = 149 31 (W.F.) Source: Official Airline Guide – September 2001 Exhibit NW-15

19. HHI Index of Frequencies 523 HHI points over highly concentrated threshold 523 HHI points over highly concentrated threshold Increase of 1,657 HHI points – 16 times the DOJ 100 point threshold Increase of 1,657 HHI points – 16 times the DOJ 100 point threshold Highly Concentrated Threshold After Merger AA/BA Control 59.0% of the Weekly Frequencies (W.F.) in the New York (JFK/EWR) – London (LHR/LGW) Market New York (JFK/EWR) - London (LHR/LGW) Frequencies The New York (JFK/EWR) – London (LHR/LGW) Market Is Already Highly Concentrated. The AA/BA Alliance Would Produce an Increase in Concentration 16 Times Greater Than the DOJ Threshold for the Presumption of Market Power DOJ Definition of Highly Concentrated Market Pre-Merger Concentration Post-Merger Concentration 125 (W.F.) 42 (W.F.) Total Weekly Frequencies = 212 45 (W.F.) Source: Official Airline Guide – September 2001 Exhibit NW-16

20. HHI Index of Frequencies 796 HHI points over highly concentrated threshold 796 HHI points over highly concentrated threshold Increase of 1,997 HHI points – almost 20 times the DOJ 100 point threshold Highly Concentrated Threshold After Merger AA/BA Control 64.1% of the Weekly Frequencies (W.F.) in the New York (JFK/EWR) – London Heathrow (LHR) Market New York (JFK/EWR) - London Heathrow (LHR) Frequencies The New York (JFK/EWR) – London Heathrow (LHR) Market Is Already Highly Concentrated. The AA/BA Alliance Would Produce an Increase in Concentration Almost 20 Times Greater Than the DOJ Threshold for the Presumption of Market Power DOJ Definition of Highly Concentrated Market Pre-Merger Concentration Post-Merger Concentration 118 (W.F.) 28 (W.F.) Total Weekly Frequencies = 184 38 (W.F.) Source: Official Airline Guide – September 2001 Exhibit NW-17

21. HHI Index of Frequencies 700 HHI points over highly concentrated threshold 700 HHI points over highly concentrated threshold Increase of 1,875 HHI points – 18 times the DOJ 100 point threshold Increase of 1,875 HHI points – 18 times the DOJ 100 point threshold Highly Concentrated Threshold After Merger AA/BA Control 62.5% of the Weekly Frequencies (W.F.) in the Boston (BOS) – London (LHR/LGW) Market Boston (BOS) - London (LHR/LGW) Frequencies The Boston (BOS) – London (LHR/LGW) Market Is Already Highly Concentrated. The AA/BA Alliance Would Produce an Increase in Concentration 18 Times Greater Than the DOJ Threshold for the Presumption of Market Power DOJ Definition of Highly Concentrated Market Pre-Merger Concentration Post-Merger Concentration 35 (W.F.) 14 (W.F.) Total Weekly Frequencies = 56 7 (W.F.) Source: Official Airline Guide – September 2001 Exhibit NW-18

22. HHI Index of Frequencies 2,089 HHI points over highly concentrated threshold 2,089 HHI points over highly concentrated threshold Increase of 3,333 HHI points – 33 times the DOJ 100 point threshold Increase of 3,333 HHI points – 33 times the DOJ 100 point threshold Highly Concentrated Threshold After Merger AA/BA Control 83.3% of the Weekly Frequencies (W.F.) in the Boston (BOS) – London Heathrow (LHR) Market Boston (BOS) - London Heathrow (LHR) Frequencies The Boston (BOS) – London Heathrow (LHR) Market Is Already Highly Concentrated. The AA/BA Alliance Would Produce an Increase in Concentration 33 Times Greater Than the DOJ Threshold for the Presumption of Market Power DOJ Definition of Highly Concentrated Market Pre-Merger Concentration Post-Merger Concentration Other U.S. 16.7% AA/BA 83.3% 35 (W.F.) Total Weekly Frequencies = 42 7 (W.F.) Source: Official Airline Guide – September 2001 Exhibit NW-19

23. HHI Index of Frequencies 1,200 HHI points over highly concentrated threshold 1,200 HHI points over highly concentrated threshold Increase of 1,531 HHI points – 15 times the DOJ 100 point threshold Increase of 1,531 HHI points – 15 times the DOJ 100 point threshold Highly Concentrated Threshold After Merger AA/BA Control 61.3% of the Weekly Frequencies (W.F.) in the Chicago (ORD) – London Heathrow (LHR) Market Chicago (ORD) - London Heathrow (LHR) Frequencies The Chicago (ORD) – London Heathrow (LHR) Market Is Already Highly Concentrated. The AA/BA Alliance Would Produce an Increase in Concentration 15 Times Greater Than the DOJ Threshold for the Presumption of Market Power DOJ Definition of Highly Concentrated Market Pre-Merger Concentration Post-Merger Concentration AA/BA 61.3% Other U.S. 26.3% Other Foreign 12.5% 49 (W.F.) Total Weekly Frequencies = 80 21 (W.F.) 10 (W.F.) Source: Official Airline Guide – September 2001 Exhibit NW-20

24. HHI Index of Frequencies 1,950 HHI points over highly concentrated threshold 1,950 HHI points over highly concentrated threshold Increase of 2,500 HHI points – 25 times the DOJ 100 point threshold Increase of 2,500 HHI points – 25 times the DOJ 100 point threshold Highly Concentrated Threshold After Merger AA/BA Control 75.0% of the Weekly Frequencies (W.F.) in the Miami (MIA) – London (LHR/LGW) Market Miami (MIA) - London (LHR/LGW) Frequencies The Miami (MIA) – London (LHR/LGW) Market Is Already Highly Concentrated. The AA/BA Alliance Would Produce an Increase in Concentration 25 Times Greater Than the DOJ Threshold for the Presumption of Market Power DOJ Definition of Highly Concentrated Market Pre-Merger Concentration Post-Merger Concentration 21 (W.F.) Total Weekly Frequencies = 28 7 (W.F.) Source: Official Airline Guide – September 2001 Exhibit NW-21

25. HHI Index of Frequencies 3,756 HHI points over highly concentrated threshold 3,756 HHI points over highly concentrated threshold Increase of 4,444 HHI points – 44 times the DOJ 100 point threshold Increase of 4,444 HHI points – 44 times the DOJ 100 point threshold Highly Concentrated Threshold After Merger AA/BA Control 100% of the Weekly Frequencies (W.F.) in the Miami (MIA) – London Heathrow (LHR) Market Miami (MIA) - London Heathrow (LHR) Frequencies The Miami (MIA) – London Heathrow (LHR) Market Is Already Highly Concentrated. The AA/BA Alliance Would Produce an Increase in Concentration 44 Times Greater Than the DOJ Threshold for the Presumption of Market Power DOJ Definition of Highly Concentrated Market Pre-Merger Concentration Post-Merger Concentration 21 (W.F.) Total Weekly Frequencies = 21 Source: Official Airline Guide – September 2001 Exhibit NW-22

26. HHI Index of Frequencies 3,756 HHI points over highly concentrated threshold 3,756 HHI points over highly concentrated threshold Increase of 4,444 HHI points – 44 times the DOJ 100 point threshold Increase of 4,444 HHI points – 44 times the DOJ 100 point threshold Highly Concentrated Threshold After Merger AA/BA Control 100% of the Weekly Frequencies (W.F.) in the Dallas/Ft. Worth (DFW) – London Gatwick (LGW) Market Dallas/Ft. Worth (DFW) - London Gatwick (LGW)* Frequencies The Dallas/Ft. Worth (DFW) – London Gatwick (LGW) Market Is Already Highly Concentrated. The AA/BA Alliance Would Produce an Increase in Concentration 44 Times Greater Than the DOJ Threshold for the Presumption of Market Power DOJ Definition of Highly Concentrated Market Pre-Merger Concentration Post-Merger Concentration * London Gatwick is used because Bermuda 2 restricts nonstop service to Gatwick 21 (W.F.) Total Weekly Frequencies = 21 Source: Official Airline Guide – September 2001 Exhibit NW-23

27. HHI Index of Frequencies 388 HHI points over highly concentrated threshold 388 HHI points over highly concentrated threshold Increase of 625 HHI points – 6 times the DOJ 100 point threshold Increase of 625 HHI points – 6 times the DOJ 100 point threshold Highly Concentrated Threshold After Merger AA/BA Control 37.5% of the Weekly Frequencies (W.F.) in the Los Angeles (LAX) – London Heathrow (LHR) Market Los Angeles (LAX) - London Heathrow (LHR) Frequencies The Los Angeles (LAX) – London Heathrow (LHR) Market Is Already Highly Concentrated. The AA/BA Alliance Would Produce an Increase in Concentration 6 Times Greater Than the DOJ Threshold for the Presumption of Market Power DOJ Definition of Highly Concentrated Market Pre-Merger Concentration Post-Merger Concentration AA/BA 37.5% Other U.S. 25.0% Other Foreign 37.5% 21 (W.F.) Total Weekly Frequencies = 56 21 (W.F.) 14 (W.F.) Source: Official Airline Guide – September 2001 Exhibit NW-24

28. Heathrow Slots

29. New Entrant Heathrow Carriers Will Be Unable to Obtain Slots First Obstacle: Slot Trades and Purchases may be Banned by the EU “The draft [EU] Regulation... will have the effect of preventing carriers from obtaining slots from incumbent carriers except through the total or partial take-over of the carrier.” -- ACL Response at 3. “The European Commission has published a proposal to amend EU Regulation 95/93 which currently governs slot allocation... BAA has significant concerns about several key elements of the draft new regulation. The amendment of the ‘new entrant’ provision which would reduce the opportunities for new US carriers to benefit from this form of priority at Heathrow; The prevention of certain forms of slot trading which currently take place, making it more difficult for airlines to set up new services” -- BAA Paper on Issues & Principles at 8. Second Obstacle: Even if Slot Trading were legal, there are no slots to be had “In ACL's professional judgment, the opportunities to accommodate new entrant US carriers from the allocation of pool slots in the first two seasons are extremely limited.” “It may be possible to accommodate up to one daily service at timings similar to Continental's daylight Newark- Gatwick service, with arrivals in the late evening and departures mid-afternoon the next day.” “There is also scope to offer 1-2 morning rotations (ie, pairs of arrival and departure slots) of [sic] on some days of the week, principally the weekends. However, in ACL's experience new entrant US carriers are unlikely to be willing to operate on a less than daily basis.” “In general, it is ACL's observation that there is a general unwillingness on the part of incumbent Heathrow carriers to divest of slots and the market is illiquid.” -- ACL Response at 5. Exhibit NW-25

30. “It is important to understand, however, that a slot is not just about an allocation of a time on a runway. In order to operate that runway slot (either arrivals or departures) an airline must also be allocated capacity within a given terminal building (Heathrow has four terminals and Gatwick has two terminals). Furthermore, at Heathrow, the coordinator must ensure that the combination of airline schedules does not exceed the declared aircraft parking capacity. An airline will not be granted a slot unless it can operate within the terminal and aircraft parking capacity constraints.” -- BAA Paper on Issues & Principles at 2. “Increasingly, in addition to the ongoing impact of the runway constraint, the aircraft parking stand constraint is affecting airlines’ ability to add new services. The effect of liberalisation at Heathrow will be an increase in the proportion of long-haul services and therefore an increase in the proportion of services with larger aircraft. Unless there are enough large stands available in the peak periods to cope with this change in aircraft size, new services will either not be able to operate or will have to operate with smaller, less appropriate, aircraft.” -- BAA Paper on Issues & Principles at 3. “Heathrow’s schedules are co-ordinated according to three formal constraints: runway, terminal capacity and stand capacity. Aside from runway capacity, aircraft stands are currently the most restraining factor, particularly for wide-bodied aircraft. Terminal capacity is based on the capacities on all facilities involved in processing passengers and / or baggage. The following are the major constricting factors within the terminal operation: Check-in desks (See response to Q13) Security Immigration Baggage Reclaim Arrivals Concourse” -- Response from BAA plc at 6. “It is conceivable that some new entrant airlines may receive a slot, from the pool, from inter-alliance transfers or through trading but the BAA would be unable to quickly provide the range and quality of facilities that an airline might need.” -- ACL Response at 9. Even If a New Entrant Heathrow Carrier Could Obtain a “Runway Slot,” It Would Face Severe Obstacles in Obtaining a Suitable “Stand” at Which to Load and Unload Its Passengers Exhibit NW-26

31. “To convert slots currently being used for narrow-bodied aircraft to wide-bodied, all airport facilities used in the passenger and baggage processes would need to be considered. The chosen terminal of operation for the wide-body slots will also have an impact. If the wide-bodied slots are to be operated in the same terminal as the narrow-body service was being operated, then the need for additional capacity will be less than that if the slots are operated in a different terminal. The main areas requiring consideration are: “Stand availability – This is dependent on the terminal of operation for the new wide-body service. Terminals 1 and 2 only have a limited number of pier-served stands suitable for use by wide-bodied aircraft of 777 or equivalent size. Terminal 3 does have some spare capacity for larger aircraft, but the cumulative total stand demand during the peak is already approaching capacity at peak hours of the day. Stand capacity at Terminal 4 [where KLM operates] is a major constraint and is already at or close to maximum levels for the larger aircraft categories (B777 / 747) for peak morning hours. Additional wide-bodied aircraft (B777 / 747) could only be managed in if other services relocated to another terminal.” -- Response from BAA plc at 4. There Are Virtually No Additional Stands Available at Heathrow That Are Suitable for Wide Body Operations Exhibit NW-27

32. Stand availability - See Exhibit NW-27 1.“Check-in desks – Additional desks would be required for a longer period of time to convert slots from use by narrow- bodied aircraft to wide-bodied aircraft on long haul routes. For example, if the aircraft type changed from a BAE146 to a B777-200, the check-in desk requirement would increase from two to seven (including two premium desks) and would need to be open for four hours instead of three. Seven additional desks would be required if the new transatlantic carrier operated in a different terminal. An airline receiving a slot does not gain rights to specific check-in desks; these must be negotiated with the handler or airport operator.” 2.“Baggage Belt Capacity – For departures and connections baggage, delivery and sortation systems are allocated in conjunction with check-in desks and, as with check-in desks, would be required for longer periods if being used for a wide-bodied aircraft.” 3.“Baggage Handling Equipment and Make-up Area – Narrow-bodied aircraft are traditionally ‘loose loaded’ and therefore require less equipment to facilitate their baggage handling. Wide-bodied aircraft are generally loaded using containers and require additional equipment and storage facilities. Any handling agent at Heathrow handling new transatlantic services will require additional equipment as these services will be operating during peak hours, and also additional space within the baggage hall and storage area, both of which are currently already a concern in all terminals.” 4.“Gaterooms – Gaterooms are allocated in conjunction with stands so are appropriately sized for the respective stand size. The majority of gaterooms in Terminals 1 and 2, which service predominantly short haul operations, are not sufficiently sized to facilitate wider bodied aircraft and will hence be an added restriction.” 5.“Immigration – A change to wide-bodied aircraft will require increased staffing by Immigration Officers, and possibly additional desks depending on the number of services arriving simultaneously. The provision of Immigration Officers is the responsibility of the UK Immigration Service.” 6.“Baggage Reclaim – Capacity assessments of baggage reclaim areas are dependent on the number of bags per passenger, and the percentage of transfer passengers for a given terminal. Hence if the mix of traffic was changed, the length of individual belts may not be sufficient to manage a wide bodied transatlantic service (particularly in Terminals 1 and 2), and additional belts may be required to service an increased number of operations in a specific terminal.” 7.“Arrival Concourse Space – The arrivals concourses in Heathrow’s four terminals are already operating at capacity at peak hours and so new services will cause added congestion, particularly if the slots have previously been operated in a different terminal.” -- Response from BAA plc at 4-5. Even If Runway Slots and Stands Were Available for New Entrant Wide Body Operations, the Scarcity of SEVEN Other Essential Heathrow Facilities and the Unlikelihood of Assembling All Seven at the Same Time and Same Terminal Make New Entry at Heathrow a Practical Impossibility Exhibit NW-28

33. “Growth Prospects” “BAA expects only a few additional slots to be created at Heathrow, a small amount of which are expected in the hours that transatlantic flights are currently being operated. In addition, the new slots are likely to be departure slots and are unlikely to have accompanying arrival slots which would be required to make new services viable... The substantial majority of these increases have been in off-peak periods.” -- Response from BAA plc at 8. “[U]ntil Heathrow’s Terminal 5 is approved, built and opened, [Autumn 2007 at the earliest] there is relatively little that can be done to relieve the aircraft parking and terminal capacity constraints.” -- BAA Paper on Issues & Principles at 4. Frozen Entry Conditions at Heathrow Are Likely to Persist for at Least the Next Six Years Exhibit NW-29

34. To Be Commercially Viable in the U.S. – London Market, U.S. Carriers Require Access to Slots Within Specified Time Windows 0100 0200 0300 0400 0500 0600 0700 0800 0900 1000 1100 1200 1300 1400 1500 1600 1700 1800 1900 2000 2100 2200 2300 2400 Commercially Viable Arrival Slots Commercially Viable Departure Slots Source: Official Airline Guide – July 2001 88.2% of slots used by non-Heathrow U.S. carriers fall inside discrete Arrival and Departure windows 05:00- 10:59 10:00- 15:59 Exhibit NW-30

35. After the Merger, American Airlines/British Airways Would Control 41.5% of Heathrow’s Commercially Viable Slots 1,875 Slots 1,399 Slots 98 Slots Total Commercially Viable Slots = 3,372 (Arrivals 05:00 – 10:59; Departures 10:00 – 15:59) Source: Exhibit NW-30; Airport Coordination Limited – April 2001 Exhibit NW-31

36. London Heathrow’s (LHR) Commercially Viable Slots are Already Highly Concentrated. The AA/BA Alliance Would Produce an Increase in Concentration 2 Times Greater Than the DOJ Threshold for the Presumption of Market Power HHI Index of Commercially Viable Slots 198 HHI points over highly concentrated threshold 198 HHI points over highly concentrated threshold Increase of 205 HHI points – 2 times the DOJ 100 point threshold Increase of 205 HHI points – 2 times the DOJ 100 point threshold Highly Concentrated Threshold London Heathrow (LHR) Commercially Viable Slots Arrivals (05:00-10:59) and Departures (10:00-15:59) – Summer 2001 DOJ Definition of Highly Concentrated Market Pre-Merger Concentration Post-Merger Concentration (AA/BA only) Source: Airport Coordination Limited – April 2001 Exhibit NW-32

37. After Both Alliances, American Airlines/British Airways and United Airlines/British Midland Would Control 58.2% of Heathrow’s Commercially Viable Slots Total Commercially Viable Slots = 3,372 1,399 Slots 563 Slots 1,325 Slots 85 Slots Commercially Viable Heathrow Slots for Services to the United States Commercially Viable Heathrow Slots for Services to the United States AA/BA UA/BD Source: Airport Coordination Limited – April 2001 Exhibit NW-33

38. American Airlines, British Airways, and United Already Control 83.4% of All U.S. – Heathrow Weekly Frequencies (W.F.) Source: Official Airline Guide – September 2001 AA/BA+UA = 83.4% Total Weekly Frequencies = 500 Exhibit NW-34

39. London Heathrow’s (LHR) Commercially Viable Slots are Already Highly Concentrated. Simultaneous Creation of an AA/BA Alliance and a UA/BD Alliance Would Produce a Greater Increase in Concentration – Almost 3 Times Greater Than the DOJ Threshold for the Presumption of Market Power – Than an AA/BA Alliance Alone HHI Index of Commercially Viable Slots 198 HHI points over highly concentrated threshold 198 HHI points over highly concentrated threshold Increase of 285 HHI points – Almost 3 times the DOJ 100 point threshold Increase of 285 HHI points – Almost 3 times the DOJ 100 point threshold Highly Concentrated Threshold London Heathrow (LHR) Commercially Viable Slots Arrivals (05:00-10:59) and Departures (10:00-15:59) – Summer 2001 DOJ Definition of Highly Concentrated Market Pre-Merger Concentration Post-Merger Concentration (AA/BA + UA/BD) Source: Airport Coordination Limited – April 2001 Exhibit NW-35

40. KLM Cannot and Will Not Make Any of Its Heathrow Slots Available to Northwest Airlines “2.... KLM wishes to make it clear from the outset, that the idea of a transfer of KLM- slots to Northwest, once Northwest has been given access to Heathrow, is an academic option only.” “3. First, it is highly debatable whether a legally acceptable ‘modus’ can be found under which such a transfer could be justified.” “4. In addition, any slot divestiture by KLM in favour of its partner Northwest would compromise directly and immediately KLM’s competitive position in the UK market vis-à-vis British Airways and other carriers at Heathrow; it would, furthermore, strengthen the relative position of the BA-AA alliance in its home market, thus causing an effect that is opposite to what would be envisaged by slot divestiture in the first place.” “5. It is KLM’s opinion, therefore, that any access given to additional or -- in the case of an Open Skies agreement between the UK and the US -- to all US carriers must be accompanied by the making available of slots to these carriers without the rights of carriers from other EU or third countries being affected.” Exhibit NW-36

41. Even If KLM Were Willing and Able to Provide Northwest With Heathrow Slots, It Does Not Possess Sufficient Commercially Viable Slots, Stands and Terminal Areas to Fund Even One Daily Round Trip Total Commercially Viable KLM Slots 42 98 29 Slots Used for Amsterdam Hub Slots Used for Eindhoven and Rotterdam Source: Airport Coordination Limited – April 2001 Not available to NW because: Slots are an essential part of KLM’s Hub Operation Use stands too small for NW wide body aircraft Not available to NW because: Slots are an essential part of KLM’s Hub Operation Use stands too small for NW wide body aircraft All slots are used by Turboprops* All slots fly into Terminal 4 There are no large aircraft stands available at commercially viable times at terminal 4 *one slot on Sunday uses an A737-300 All slots are used by Turboprops* All slots fly into Terminal 4 There are no large aircraft stands available at commercially viable times at terminal 4 *one slot on Sunday uses an A737-300 Departures Arrivals 71 NWA Requirement for 7 Daily Round Trips Eindhoven and Rotterdam Slots With Stands and Terminal Space Therefore It is not possible for NW to obtain any commercially viable slots Therefore It is not possible for NW to obtain any commercially viable slots Commercially Viable Slots Exhibit NW-37

42. The Vast Majority of Commercially Viable Heathrow Slots – 77.9% – Are Under the Control of Airlines and Airline Groups That Will Be Unable or Unwilling to Make Them Available to Non-Incumbent U.S. Air Carriers Total Commercially Viable Slots = 3,372 1,399 Slots 563 Slots 745 Slots 386 Slots 194 Slots Source: Airport Coordination Limited – April 2001 Oneworld STAR Non-Oneworld or STAR 85 Slots Virgin Only 745 Commercially Viable Slots – 22.1% of the Total – Are Even Theoretically Available for New Entrant U.S. Carriers Exhibit NW-38

43. Although 745 Weekly Slots Are Theoretically Available for Acquisition by New Entrant U.S. Airlines, After Oneworld, Star and Virgin Are Removed, Realistically There Are NO Weekly Slots Available for Acquisition by Any U.S. Carrier Slots used by Narrow Body Jets, RJs, and Turboprops Carriers Do Not Possess Enough Slots for Even 1 Daily Round Trip per Week Source: Airport Coordination Limited – April 2001 Theoretical Commercially Viable Slots - BEFORE Practical Reductions* KLM (Amsterdam) Air India (Bombay - 12 JFK – 14 ORD – 6) BWIA (Port of Spain, Trinidad) Emirates Air (Dubai) Aeroflot (Moscow) Theoretical Commercially Viable Slots - AFTER Realistic Reductions It is Impossible for a U.S. Carrier to Compete with AA/BA Without Access to London Heathrow Available Not Available Slots NOT Available for Acquisition – Used for Hub Service and Essential Routings Slots NOT Available for Viable Transatlantic Operation – Carriers Do Not Possess Enough Slots for Even 1 Daily Round Trip per Week Slots NOT Available for Transatlantic Service – Slots and Facilities are Used for Narrow Body Jets, RJs, and Turboprops * Exhibit NW-38 Exhibit NW-39

44. Public Benefits – Connectivity

45. London Heathrow Has Limited Utility as a Connecting Facility. To Fund High Frequency Point-to-Point Service, British Airways Has Deleted Large Numbers of Cities from Its Heathrow Network “... [W]e have had a renewed focus on serving the big business markets... There is a cost for that which is that we have to get the slots from somewhere and... about 15 shorthaul destinations have been dropped from the Heathrow network.” -- Robert Boyle, British Airways General Manager Network Planning, Investment Community Presentation, page 7. Exhibit NW-40

46. Even Though Heathrow Has Limited and Shrinking Utility As a Connecting Facility, U.S. Passengers Who Can Access Points Beyond London at Heathrow Outnumber U.S. Passengers Who Can Access Points Beyond London at Gatwick by 74 Percent U.S. – Gatwick Beyond U.S. – Heathrow Beyond Millions of Annual Passengers Source: Official Airline Guide, September 1-7, 2001; MIDT: True O&D Bookings – Year Ended April 2001 Nonstop Service to 57 Beyond cities Nonstop Service to 45 Beyond Cities Exhibit NW-41

47. British Airways Actually Serves 27 Fewer Cities from Heathrow With Its Own Aircraft Today Than Six Years Ago, and Six Fewer Cities Than a Year Ago 1995 - 20012000 - 2001 Oslo Milan (MXP) Abu Dhabi Detroit Calcutta Madras Islamabad Amman Beirut Bilbao Bremen Basil Caracas Cologne Damascus Dhahran Buenos Aires Oslo Rio de Janeiro Gothenburg Hanover Harare Inverness Jersey Osaba Kuala Lumpur St. Petersburg Lusaka Luxembourg Lyon Nairobi Nagoya Newquay Porto Paris (ORY) Plymouth Pisa Seoul Tehran Turin Venice CalcuttaBilbao Cologne Jersey Kuala Lumpur Paris (ORY) Tehran Venice 7 Points Added34 Points Dropped1 Point Added7 Points Dropped Source: Official Airline Guide, September 1-7, 1995, 2000, and 2001 Exhibit NW-42

48. British Airways Has Implemented Commercial Strategies to Discourage Transfer Passengers Because British Airways Does Not Want Passengers to Use Heathrow Airport as a Transfer Station to Its European Network “Direct traffic has a 25 point higher direct margin than transfer.” “Our focus is mainly on reducing our exposure, first and foremost, to the traffic in which we and the industry are performing worst, and that is the transfer business.” “More dramatically, what has happened to the transfer business. You can see very deep reductions in low yielding transfer business and increases again in middle yielding and higher yielding fare categories.” -- David Spurlock, British Airways Director of Strategy, British Airways Investors Day, pages 5-6, 14. Exhibit NW-43

49. British Airways Has Adjusted Its Schedule to Discourage Transfer Traffic from Using Heathrow Airport “In terms of shorthaul, there are big benefits around freeing shorthaul from the need to structure itself to feed the longhaul operation. It allows us to tailor the shorthaul operation to the needs of shorthaul and, therefore, to have a better chance of making money.” -- Robert Boyle, British Airways General Manager Network Planning, British Airways Investors Day, Network, page 15. Exhibit NW-44

50. American and Its Current Code Share Partners Already Can Create Pervasive “On-line” Access to Europe, Africa, and the Middle East Los Angeles New York (JFK,LGA,EWR) Boston Miami Chicago (ORD) Dallas/ Ft. Worth Stockholm Belfast Bologna/Rimini Brussels Budapest Paris Copenhagen Dublin/Shannon/Cork Düsseldorf/Stuttgart Dubai Edinburgh Rome Frankfurt/Prague Glasgow Geneva Hamburg Helsinki Istanbul/Thessaloniki Johannesburg Cologne Milan/Verona Lisbon Madrid Manchester Birmingham Munich Naples Nice/ Genoa Oslo Bucharest Hannover/Berlin Amsterdam Venice Vienna Warsaw Zurich Abidjan Lanzarote Izmir Malaga Alicante Athens Abu Dhabi Belgrade Banghazi Beirut Bergen Cairo Chania Conakry Casablanca Cantania Dakar Douala Enontekio Bilbao/ San Sebastian/Santander Lagos/Faro/Sevilla Kinshasa Fuerteventura Gothenburg Granada Iraklion Ibiza Ivalo Jeddah Joensuu Tampere Kajaani Kuusamo Kemi/Tornio Kiev Kokkola Kittila KuopioVaasa Larnaka La Coruna/Asturias/ Santiago De Compostela St. Petersburg Almeria Gran Canaria Jyvaskyla/Lappeenranta Menorca Muscat Mariehamn Malta Murmansk Lyon/ Marseille Nairobi Yaounde Barcelona/Oporto Ouagadougou Oulu Pafos London Bristol Plymouth Pristina/Skopje Rhodes Riga/Tallinn Riyadh Rovaniemi Moscow Tehran Tripoli Tel Aviv Malabo Tenerife Turku Tangler Tunis Toulouse Sofia Valladolid Vilnius 128 points in Europe, Africa and the Middle East Exhibit NW-45

51. With London’s Limited Utility as a Transfer City, the AA/BA Code Share Plan Provides Virtually No Additional Network Access to Europe, Africa and the Middle East Beyond That Which American Airlines Already Has With Its Existing Code Share Partners Total foreign points where AA/BA plan to code share* Number of proposed AA/BA code share points already served by AA and 5 European code share partners New cities made available to AA’s U.S. passengers as a result of BA code share The AA/BA Alliance Would Create New Online Service to Only 17 Small Cities, Mostly in Africa and the Middle East * Code Share cities listed in Docket OST 2001-10388 Source: Official Airline Guide – September 2001 and O&D Survey Year End 2000 Number of Points Exhibit NW-46

52. The AA/BA Code Share Plan Provides Virtually No Additional Network Access to Europe, Africa and the Middle East Beyond That Which American Airlines Already Has With Its Existing Code Share Partners * Code Share cities listed in Docket OST 2001-10388 17 New On-Line Cities Produce Only 45,110 Additional Annual O&D Passengers Source: Official Airline Guide – September 2001; O&D Survey,Year End 2000 98.3% 1.7% Exhibit NW-47

53. The 527 O&D City Pair Markets That Are Transaction Specific to the AA/BA Alliance Are Very Small, Producing Only 45,110 Passengers Per Year, an Average of Less Than 0.1 Passenger Per Day Each Way (PDEW) to the 17 Unique BA Points PDEW To All 17 BA Cities Combined The O&D Average Per New Online U.S. Point Is Below 0.5 PDEW for the Largest U.S. Cities to the 17 BA Transaction Specific Points Combined Source: DOT O&D Survey Year End 2000 Exhibit NW-48

54. On a Hypothetical Total Network to Total Network Basis, American Airlines Passengers Would Have Much Broader Access to Europe, Africa, and the Middle East on Its Existing Code Share Partners Than They Would Have on British Airways AA – BAAA – SR/SN/IB/FY/EI Source: Official Airline Guide – September 1-7, 2001 Total Number Cities Operated in U.S., Europe, Africa, and Middle East AA Points Only BA Points Only AA Points Only SR/SN/IB/FY/EI Unduplicated points Exhibit NW-49

55. American’s Hypothetical Total Network Access With Its Existing Code Share Partners Is Greater Than a Hypothetical American/British Airways Combined Network AA/BA AA – SR /SN/IB/FY/EI Millions of Annual Passengers Source: MIDT: True O&D Bookings – Year Ended April 2001 Exhibit NW-50

56. Compared to Existing Major Immunized Alliances, AA/BA Provides Virtually No Additional Market Access to Europe, Africa and the Middle East NW/KL UA/LH AA/BA Increases online PDEW by 13,631* Adds additional 9,816 new online O&D points** 21.1% of Total U.S. – E.U./Africa/Middle East passengers Increases online PDEW by 13,631* Adds additional 9,816 new online O&D points** 21.1% of Total U.S. – E.U./Africa/Middle East passengers Increases online PDEW by 232* Adds additional 1,508 new online O&D points** 0.1% of Total U.S. – E.U./Africa/Middle East passengers Increases online PDEW by 232* Adds additional 1,508 new online O&D points** 0.1% of Total U.S. – E.U./Africa/Middle East passengers Increases online PDEW by 5,664* Adds additional 11,392 new online O&D points** 8.8% of Total U.S. – E.U./Africa/Middle East passengers Increases online PDEW by 5,664* Adds additional 11,392 new online O&D points** 8.8% of Total U.S. – E.U./Africa/Middle East passengers Additional market access relative to NW/KL PDEW Source: MIDT: True O&D Bookings, Year Ended April 2001 ** New O&D not previously served by either carrier using its own aircraft and/or code sharing with existing partners. * New PDEW carried by Alliance not previously carried by either partner unilaterally. Note: Excludes O&D markets that generated less than 11 bookings per year. Exhibit NW-51

57. American Airlines’ Commercial Relationships, Many of Which Occur Outside of the Oneworld Brand, Already Make American Airlines the Anchor of the Second Largest Airline Group in the World – Counting British Airways, It Is the World’s Largest Oneworld and Other AA Code Share Partners * Star and Other UA Code Share Partners Total Annual Passengers Sky Team And Other DL Code Share Partners Northwest and KLM and Their Other Code Share Partners BA Portion 267,154,724 Source: International Air Transport Association (IATA) Year 2000 * Assumes SR/SN is part of American Airlines for all of 2000. Exhibit NW-52