TORONTO (Bloomberg) — Zoom Airlines, a closely held UK- Canadian carrier, began flying between New York and London yesterday, challenging British Airways Plc and American Airlines for market share on the route with a one-way fare of $199 before taxes.Zoom, which launched flights to Bermuda earlier this month, will fly Boeing Co. 767-300s five days a week between New York’s John F. Kennedy International and London’s Gatwick airports, the airline said in an e-mailed statement. Zoom has a promotional one-way fare of $99 including taxes until July 13.

“BA and American make a lot of money from business class on this route,” said Darryl Jenkins, an independent aviation consultant in Marshall, Virginia. Zoom “will have to be flying an awful lot of seats before they will do any damage”.

The new service gives Ottawa- and London-based Zoom a head start over Ryanair Holdings Plc, Europe’s largest discount airline, which announced plans in April to start a discount trans-Atlantic carrier within four years.

Zoom is focusing on taking cost-conscious customers away from established airlines including BA, American and Virgin Atlantic Airways.

“We think BA and Virgin are very comfortable together, almost a little cartel, where prices are exactly the same,” said Hugh Boyle, the Scottish entrepreneur who co-founded Zoom in 2004 with his brother John. “We’re breaking that mold.”

British Airways’ one-way fare for a June 28 departure from New York’s John F. Kennedy International Airport to London’s Heathrow Airport is quoted today at $846.10 including taxes on the carrier’s website.

The cheapest fare available from Virgin Atlantic’s Web site on that day is $737.10 including taxes.

In addition to its $199 fare, Zoom said it will offer a “premium economy” service, with more legroom, for an extra $179 one way, or $378 total.

When the open-skies agreement takes effect on March 30 next year, EU airlines will be able to serve the US from anywhere in the bloc, not just their home countries.

The accord also will undo a 1977 US-UK agreement limiting access to Heathrow, Europe’s busiest, to British Airways, Virgin, American and UAL Corp.’s United Airlines.

Low-fare trans-Atlantic flights were attempted once before by the late Freddie Laker, a UK entrepreneur.

He set up Laker Airways in 1976 to provide “Skytrain” service between New York and London. The carrier went bankrupt in 1982.

Boyle said he’ll succeed where Laker failed because Zoom saves money using the Internet to sell tickets and market the airline.

“What is different is the timing,” he said. “Although we’re low-cost, we’re full-service.”

The New York-London flights will include meals, soft drinks and in-flight movies but not free alcohol, Boyle said.

Zoom also serves eight Canadian cities and European destinations including Paris and Glasgow.