DOT Approved The American Airlines-JetBlue Partnership (By Skipping Deadline To Object)

In July American Airlines and JetBlue announced a partnership involving codesharing and frequent flyer programs. It’s been expected that American would turn over some New York flying to JetBlue, and American would focus more internationally.

At the time American Airlines said it would mean the launch of New York JFK – Tel Aviv as well as seasonal New York JFK – Athens and seasonal New York JFK – Rio de Janeiro service in winter 2021.

The two airlines submitted copies of their agreement to the Department of Transportation for review on July 22, 2020. The review requirement isn’t just for codeshares and frequent flyer program tie ups as announced but also for “long-term wet leases involving a substantial number of aircraft” – a wet lease provides not just planes but also crew.

The DOT had 30 days to respond, but took its available option to extend that deadline, which on August 20 they did to November 19, 2020 (noting that they might terminate the waiting period early when they concluded their review).

November 19th passed without comment (HT: @IshrionA), and like the Latin phrase qui tacet consentire videtur or “he who is silent is taken to agree.” Since the waiting period passed without the DOT taking action, “the parties are free to implement their agreement unless the Department has taken action.”

This gives American Airlines strength in the Northeast, plugging an important hole in its network the way that Alaska Airlines does so for them in the Northwest. For JetBlue this gives them a way to expand in congested markets – expect to see them picking up slots at New York JFK. And for Delta this means new competition in New York and Boston.

I’ve reached out to American and JetBlue for comment and will update if they respond. Update: American Airlines agrees with my analysis and offers,

The DOT’s review period has expired and we are discussing next steps toward implementation. We are excited to bring our customers more options and an enhanced product in the Northeast.

About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. @OneXMarine – I view it as potentially good, creating a stronger competitor to Delta (and United) in New York since right now American is largely an also-ran. However the answer is very much it depends since much of what they plan hasn’t been made public yet.

  2. It is doubtful that the AA-B6 will improve AA’s position in the NE. B6 will gain passengers on flights it “takes over for AA.” AA might pick up a few connecting passengers at JFK but a terminal change is not going to be competitive on top of other differences between other carriers.
    And AA still is trying to support hubs at both PHL and JFK – so they are competing against themselves in markets that are not near as strong as other carrier international gateways.

    Continental and Northwest had the most extensive codeshare operation between any two US airlines and both ultimately wanted out of the arrangement because there is too much valuable data being passed between competitors which will result in one or both sides doing what they can to gain passengers on their own.

    Antitrust immunized joint ventures work because they bring carriers from different markets together to create a stronger “one.” Codeshare relationships by carriers in the same country don’t work.

  3. @Tim – But when DL codeshared with AS in SEA, I’m sure the relationship was very fruitful, right?

  4. If there is an allowance for wet leases, is this some kind of way for American to deal with it’s cost structure by outsourcing to B6?

  5. Meanwhile AA has furloughed 1246 pilots with close to another 1000 on zero guarantee lines (no pay and no guarantee they will have anything to fly).

  6. Why do we still have no idea what this will practically mean (e.g., codeshares, route swaps), just the same conjecture about changes in the Northeast?

  7. The writing is on the wall for JetBlue. AA is going to swallow us whole and leave the workers to fend for themselves.

  8. AA simply cannot afford an acquisition especially with their current cash burn and lack of business travelers. It may well be a while before anyone summons the courage to buy another carrier.

  9. @ ^^^^
    Since Delta built its own SEA hub and severed relationships with AS, it should be clear that DL-AS is yet another example of why domestic codesharing doesn’t work.

  10. Recently Delta & WestJet had to stop their purposed codeshare. This was due to DOT wanted DL to give up slots at LGA after all the money DL spent to get LGA construction off the ground and invest heavily to make it a DL hub operation. It tells me the that the AA & B6 application is being favored as a domestic code share than an international one with DL & WJ. More passenger benefits would happen with Delta and WestJet and a seamless operation for connections. I have more faith in the DL & WJ proposal than the AA & B6 operation proposal

  11. So this didn’t really get “approved with no comment.” It was approved (announced today 1/12/21) with slot divestitures by both airlines at JFK and DCA. Definitely wasn’t approved outright. “Following an approximately six-month review, the DOT has agreed to terminate its review of the alliance in exchange for a series of commitments to ensure the alliance delivers consumers benefits
    without harming competition.”
    TLDR: AA/B6 had to negotiate a deal with DOT to get this approved.

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