U.S. senator concerned American, JetBlue partnership will raise prices By Reuters
© Reuters. FILE PHOTO A Boeing 777-300ER aircraft of American Airlines takes off from Sydney Airport, Sydney, Australia on October 28, 2020. REUTERS/Loren Elliott/File Photo
WASHINGTON (Reuters) – U.S. Reported by Senator Richard Blumenthal (Democrat), who is known for his outspoken views on antitrust, the Transportation Department expressed concerns that a partnership with American Airlines (NASDAQ;) and JetBlue Airways(NASDAQ:) could lead to more expensive airfares.
In July 2020, “Northeast Alliance”, a partnership of airlines was announced. Six months later, just before Trump’s departure from office the Transportation Department had approved it.
American Airlines and JetBlue will be able to offer each other flights within their New York-area networks, Boston network and to link frequent flyer programmes. The agreement is intended to allow them to have more power in competition with Delta Air Lines and United Airlines (NYSE:) in Northeast America.
Blumenthal wrote to U.S. Transport Secretary Pete Buttigieg, expressing grave concern that American Airlines’ recent partnership with JetBlue Airways would lead to anti-competitive coordination of key air traffic hubs. It also could result in long-term inflation in airfares and associated costs for airline passengers.
Blumenthal asked for an “full public inquiry and investigation into the Northeast Alliance cooperative accord,” noting President Joe Biden’s July executive order on competition. Blumenthal quoted the White House’s statement that four of America’s top airlines controlled nearly three-quarters of the domestic U.S. market.
“I’m concerned that the Northeast Alliance, which is precisely the type of arrangement that led to our current situation, will cause more concentration in an already concentrated sector. He wrote that the arrangement is worthy of more scrutiny given the facts.
JetBlue stated that the partnership gave Delta and United genuine competition.
JetBlue claimed that American slot access would allow the airline to bring the JetBlue effect, which could lower prices and stimulate demand on more Northeast routes.
On Thursday, the Transportation Department stated that it would award 16 landing and take-off slots at Newark Liberty International Airport (Newark Liberty International Airport) to an undetermined low-cost carrier. It also suggested it might take steps to increase competition at major airports.
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