ZURICH, March 12 (Reuters) - The chairman of the new "Swiss" national airline hinted on Tuesday the carrier would pick the OneWorld alliance led by British Airways (BAY) and American Airlines (AMR) as its international partner later this month. Addressing a business lunch, Pieter Bouw declined to come out clearly and name its partner, but his description of the relative advantages and disadvantages of such a link clearly pointed to OneWorld. Swiss, which is emerging from beefed-up regional carrier Crossair (CROZn) plus the vital remnants of collapsed flag carrier Swissair (SWSZn), is also reviewing Air France's (AIRF) Skyteam and the Star Alliance led by United Airlines (UAL) and Germany's Lufthansa (LHAG). "The potential to integrate networks with Lufthansa and Star Alliance is relatively less than the potential to cooperate with Air France/Sky or with OneWorld/BA," Bouw said while walking the audience through his thinking process. "This is not the only reason because that would answer the (alliance) question and I am not going to do that, but that is a very important point." A second major factor was the role of the U.S. partner in the alliances, not just the dominant European carrier, he said. "The potential for cooperation with American Airlines is a little bit larger than the potential for working together with Delta Air Lines (DAL), but substantially larger than working together with United Airlines (UAL)," he went on. Delta is allied with Air France. Bouw said other critical factors were having a clear strategic explanation for the linkup and a gut feeling that the partners could work together to master any problems that arise. The former KLM (KLM) executive said alliances were the only way forward in an industry where government regulation eclipses standard rules of business, but where scale is important as costs play an ever increasing role. He stressed that Swiss would not try to compete against low-cost, no-frills competitors because of Switzerland's high cost base and a commitment to a full range of services that resulted from a public-private bailout of the Swiss aviation industry when debt-laden Swissair went down last year. The low-cost end of the air travel market is likely to be the fastest-growing segment of an industry still set to see overall annual growth rates of five to six percent for a decade, Bouw said, but it is a segment Swiss cannot afford to enter. COST REDUCTIONS Bouw was speaking during a break in his salary negotiations with pilots, many of whom have balked at taking home a third less pay to ensure costs are kept under control. He said he sympathised with pilots facing such sharp pay cuts, but said Swiss had three options if pilots insisted on fighting for more money instead of fighting for jobs. It could seek to cut costs elsewhere in the budget, revisit its plan to take on 26 short-haul and 26-long haul aircraft from Swissair, or else stop the project altogether, he said. But that was not an option, he insisted, given the number of hurdles the national rescue plan has cleared. "Let's be absolutely clear. Swiss is going to fly," he said. The carrier has said in the past it intends to unveil the name of its international alliance partner on March 26 when it holds its annual results news conference. Swiss is the brand name of the airline that takes over as Swiss flag carrier on April 1. It will take over some 70 percent of the old Swissair routes when Swissair stops flying at the end of this month and is wound up. Crossair on Monday reported a 2001 loss of 314 million Swiss francs -- against a loss of 25.4 million in 2000 -- after taking 290 million in special charges for the Swissair collapse. ©2002 Reuters Limited.