FORT WORTH- Following the US Department of Justice’s determination in May that the Northeast Alliance (NEA) between two of the nation’s largest airlines was anticompetitive, American Airlines (AA) promptly expressed its plan to challenge the decision.
Nearly seven months later, the airline has officially submitted the appeal, according to Reuters.
American JetBlue Northeast Alliance
Initiated in 2020, the Northeast Alliance involved American Airlines and JetBlue (B6) in collaborating and coordinating schedules for flights to and from New York and Boston.
As the largest airline globally by passengers carried, American Airlines, in conjunction with JetBlue, the sixth-largest airline, bolstered its significant presence in both cities. The partnership allowed them to concentrate on profitable routes, with each carrier filling gaps in the other’s network.
While American Airlines acknowledges the unfeasibility of its alliance with JetBlue, both airlines face a ten-year prohibition from entering into similar agreements, as mandated by the court ruling.
This specific aspect of the decision is the focal point of the carrier’s appeal, presumably aiming to keep avenues open for potential future joint ventures.
American Airlines legal representatives argue that the ruling contradicts established US Supreme Court precedent, contending that joint ventures are seldom prohibited on antitrust grounds “because they usually have a pro-competitive rationale.”
They proceeded to express that the decision “erroneously terminated a beneficial commercial arrangement that introduced additional flights, increased seat availability, and expanded options for consumers without triggering price hikes.”
Following this, they delved into the potential repercussions of the decision on an industry-wide scale, stating,
“If not addressed, the district court’s decision will deter productive and legal collaboration that enhances consumer benefits through heightened output, reduced prices, and improved product quality.”
Focus on JetBlue-Spirit Merger
After the initial verdict, JetBlue opted not to challenge the Northeast Alliance ruling and instead directed its focus on defending its $3.8 billion acquisition of Spirit Airlines (NK). Concluding statements for that case were presented earlier this week, and both carriers now await the decision.
The Department of Justice is actively working to obstruct the merger on antitrust grounds, expressing concerns that the absence of the ultra-low-cost carrier Spirit Airlines could lead to a nationwide increase in airfares.
According to data from ch-aviation, Spirit Airlines operates a fleet of 205 Airbus A320 family aircraft, while JetBlue’s fleet comprises 302 aircraft, including 57 Embraer E190s, 22 Airbus A220s, and 223 A320 family aircraft.
If the proposed merger is approved, the combined carriers would emerge as the fifth-largest airline in the United States.
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