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All-Business-Class Flights Take Off

Four start-up airlines-Eos, MAXjet, Silverjet and l'Avion--that offer cheaper trans-Atlantic flights for business travelers are catching the attention of Virgin Atlantic Airways and British Airways. The established carriers say they may compete with the new carriers, which offer fares far below those for regular business and first-class seats, along with private departure and arrival lounges.

Virgin announced last month that, within 18 months, it planned to start flying some international routes using planes configured with all-business-class seating. Willie Walsh, CEO of British Airways, says his airline is also studying routes and fare structures for all-business-class flights.

An entry by Virgin and British Air into an all-business-class market would pose new challenges for major U.S. carriers that offer trans-Atlantic flights like American, United and Delta. While some of the U.S. carriers are upgrading their business-class cabins, the domestic carriers have not yet reacted aggressively to the all-business-class startups. All four startups say demand has exceeded their expectations; they they filled 70% or more of their seats in June.

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