When it comes to garnering antitrust immunity for an alliance with British Airways PLC, American Airlines Inc. officials hope the third time's a charm.

The Fort Worth-based airline announced Thursday that it had signed a joint business agreement on flights between North America and Europe with BA and Spain's Iberia Líneas Aéreas de España. It also plans to expand its cooperation with the two carriers and seek antitrust immunity.

Gerard Arpey, American's chairman and chief executive, said the deeper alliance would allow the carrier to compete more effectively in the important European markets.

"This is a big step to putting American Airlines on a stronger long-term financial footing," he said.

The three carriers are already part of the Oneworld alliance, but they are hamstrung when it comes to coordinating between North America and Europe.

Members of American's AAdvantage frequent-flier programs can't accrue AAdvantage miles if they fly between the U.S. and London on British Airways, for example. And Oneworld members can't coordinate schedules or pricing.

Under the proposed partnership, the carriers could jointly set prices, coordinate schedules, share revenue and integrate their frequent-flier programs. Officials also hope to reduce costs through things such as joint purchasing and marketing.

"Right now, compared to SkyTeam [another global airline alliance], we're at a significant disadvantage because we have to compete with our partners rather than cooperate," Mr. Arpey said.

He declined to say how much the deal could mean in revenue, but Mike Boyd, an aviation consultant based in Evergreen, Colo., estimated it could generate an additional $500 million to $600 million a year for American.

For consumers, the deal could mean more nonstop flights to Europe while staying within a single frequent-flier program – a big plus for business travelers seeking more flight options and elite status.

"It's good news for frequent fliers," said Tom Parsons, owner and fare watcher for Arlington-based Bestfares.com. "They're going to have more choices."

Mr. Parsons said routes to London are extremely competitive, and he doesn't expect the deal to change that. Even so, the deal could result in the carriers trimming flights in some markets where there's a lot of overlap, he said.

Mr. Boyd said he didn't expect the deal to translate into higher fares. "This is about interconnecting people on an existing system," he said.

American and BA last applied for antitrust immunity in August 2001 but withdrew their application by the next January after regulators said the carriers would have to give up 224 weekly landing slots – or 16 daily round-trip flights – at London's Heathrow Airport.

In 1996, the two carriers sought immunity, but the application was dismissed because U.S. and British officials had not reached an Open Skies agreement.

Mr. Arpey said the timing was better this time, thanks to the Open Skies agreement that took effect on March 30, removing many restrictions on flying across the Atlantic.

Although American and BA still dominate Heathrow, Star and SkyTeam alliance airlines have launched 13 daily flights there since March – in addition to another seven daily flights by other carriers. American said that increase in service represents 280 weekly landing slots.

"We don't think there's a rational basis for preventing American and British Airways and Iberia from competing in the same manner as the Star Alliance or SkyTeam," Mr. Arpey said. "We want to be able to compete on a level playing field."

The SkyTeam alliance includes Delta Air Lines Inc., Northwest Airlines Inc., Continental Airlines Inc., Air France and KLM. The Star Alliance includes United Airlines Inc., US Airways, Lufthansa and Scandinavian Airlines.

American's antitrust application includes other Oneworld alliance members Finnair Oyj and Royal Jordanian Airlines.

Mr. Boyd said the U.S. Department of Transportation is likely to approve the request this time.

"The political environment has changed," he said. "They've [the DOT] approved it for other alliances, and it's worked fine. They have no reason not to approve it for this alliance."