The air route between London to New York is one of the most important in the world for business travellers. In this year’s summer timetable, there were just short of 60,000 seats every single week between the two cities. Last year, 2.8 million passengers flew on the Heathrow-JFK route while another 700,000 flew between Heathrow and Newark.

The state of the airline market on the route is revealed in the recent application to the US authorities by British Airways for a closer tie-up with its long-time partner American Airlines. The accompanying statistics show that British Airways is the biggest carrier on the route, with 38.4% of the seats and 33.4% of the bookings in the year ending March 2008 (although this later figure excludes BA passengers who connect through Heathrow). The second most important player is Virgin Atlantic, with 22.8% of the seats and 27.1% of the bookings (again excluding connecting traffic). American Airlines is the third biggest player.

But a year is a long time in business travel. Compare the London-New York market to a year ago and today it is a very different beast.

This can be seen most clearly by the demise of the three all-business class carriers which operated on the route – Eos Airlines, Silverjet and MAXjet. All were steadily increasing their passenger numbers, nibbling away at the others but rising oil prices and an overall slowdown in demand did for them.

Eos Airlines, in particular, had achieved much in attracting business passengers away from British Airways, Virgin and American. Business travellers were attracted by the small number of seats on every plane, making for a very personalised experience, while Stansted seemed a far more pleasant experience than hassle-filled Heathrow. The airline was also offering business travellers some very keen deals in order to win them over. But when American Airlines started its own rival service from Stansted, it was the final nail in the coffin and it filed for bankruptcy.

Although these three all-business carriers added very few seats to the overall market and had little effect on the natural supply and demand, they did keep the fares offered by the other carriers under control.

The other big change that has affected the London-New York market in the past year is the advent of Open Skies, the deal which saw the liberalisation of the aviation market between the European Union and the United States. At the heart of the agreement was a deal to open up Heathrow airport to more competition. Previously, only six carriers were permitted to operate services between Heathrow and the US – American Airlines, British Airways, Virgin Atlantic and United Airlines plus Air India and Kuwait Airways.

Now anyone with access to slots at Heathrow – admittedly not the cheapest things to buy in the world - can fly on the route and both Continental and Delta have switched their New York services from Gatwick to the airport. Even though this has not changed the overall level of competition on London-New York, it has increased the competition at Heathrow.

In fact, according to airline statistics provider OAG, flight capacity between Heathrow and the US increased by 24% after Open Skies came into effect. This is staggering when you consider the number of flights already crossing the Atlantic from the London airport.

The final factor affecting the London-New York market is the state of the financial sector. Ever since the credit crunch began to hit, many financial companies have been cutting back on their business travel.

So what has the impact of all this change been on business class fares? Business travel agency American Express has just released research which shows what a dramatic impact all this activity has had. The firm’s Business Travel Monitor study shows that average full business class fares between London and Newark are down 25% year on year while those between London and JFK are down 24%.

Although it is tempting to see this as a general trend in the market, average discounted business fares in all markets from the UK are down by just 4.3% over the past 12 months.