. @JusticeATR and six states plus D.C. have filed a suit to block American and JetBlue's partnership
Background on the deal, approved on Trump DOT Secretary Elaine Chao's last day: politico.com/news/2021/01/1…
Complaint is here: courtlistener.com/docket/6040091…
DOJ joined by AZ, CA, DC, FL, MA, PA, VA, calls the partnership "an unprecedented and anticompetitive pact" likely to lead to millions of dollars in higher fares for consumers.
In a January 2020 presentation to American’s Board of Directors, executives said the "leading value of a JetBlue partnership is to '[f]urther domestic consolidation.'
The harm won't just be to places that JetBlue and AA would otherwise compete, DOJ alleges. Because of the JetBlue partnership, American decided to "“de prioritize" Philadephia and reduce investments and planned flights there.
DOJ lists 98 smaller airports/connecting routes in which JetBlue offers a cheaper option against legacy carriers (some of them the only other option being American). Places like Martha's Vineyard, Nantucket, Syracuse, Burlington, VT, Buffalo, Rochester.
Complaint also alleges the deal incentives JetBlue to "pull its punches" against American since the partnership relates to 60-70% of the company's existing business. To avoid upsetting its "partner," JetBlue has less incentive to expand its European and into new domestic service
Of course, American and JetBlue say this isn't true. JetBlue told my colleague @Oriana0214 that the deal is the only way they can compete against Delta and United, who dominate the NE market
They also pushed back on the idea that DOT approved this in an irregular or rushed process, calling it "just bologna."
DOT has issued a "clarification" on the agreement it entered into with AA-JetBlue in January. transportation.gov/sites/dot.gov/…
"DOT’s review of the NEA under section 41720 was not designed to approve or disapprove the alliance." The agreement "sought concessions from the carriers that were intended to mitigate some of the anticompetitive harm while providing a means for monitoring"
"the Department intends to defer to DOJ, as the primary enforcer of Federal antitrust laws, to resolve antitrust concerns with respect to the NEA."
In the meantime, DOT is staying a complaint filed by Spirit Airlines that the AA-JetBlue deal was an unfair method of competition pending resolution of the DOJ suit.
• • •
Missing some Tweet in this thread? You can try to
force a refresh
