American Airlines internal reference materials show that they’ve begun the wind-down process for the Northeast Alliance. A federal district court judge ruled for the government that the partnership between the two airlines violated anti-trust rules, and JetBlue decided not to appeal the decision, instead focusing on anti-trust hurdles to closing their acqiusition of Spirit Airlines.
- The ability to book new codeshare flights is now being limited.
- Customers with existing codeshare bookings can continue to travel on those flights.
- There will be “limited availability” for booking American Airlines-coded and JetBlue-operated flights through October 28.
- The last day where it will be possible to book American codeshares on JetBlue is October 28.
No announcement has been made yet about whether a partnership of some kind will continue. That is, in some measure, up to the judge in the case who has not yet released his final order. The two airlines have asked to be able to continue to partner – the judge found that the style of partnership in place between American Airlines and Alaska is pro-competitive, while the government has asked for limits on the ability of these airlines to enter into partnerships, monitoring of their activities, and prior review of such arrangements.
Ironically, JetBlue’s acquisition of Spirit is likely to have a detrimental effect on airfare – moving the largest ultra low cost carrier out of the ultra low cost business model; eliminating their low fare competition; removing seat capacity from their planes; and imposing a higher cost base on their operations.
Meanwhile, the American Airlines-JetBlue partnership added seats into the market (required by the agreement they struck with the Department of Transportation to move forward with the arrangement) and created a viable third competitor to United and Delta in New York.
Reading some of the other blogs, there seems to be some concept that JetBlue isn’t *really* giving up on the NEA, but is letting AA carry the water with the appeal on the hopes that the appeal works, and that the NEA can continue. This view was brought up on Live and Lets Fly and a few other blogs. Is it me, or is there no sign this is actually the case? JetBlue seems to be happy to get out of this regardless.
there are a whole lot of people that want to believe the NEA is not dead and also to cling to the notion that it was pro-consumer.
The DOJ and a federal judge said otherwise.
Some said some people’s minds will catch up w/ reality.
The NEA is dead.
Tim,
Once JetBlue failed to join in the appeal, regardless of the merits or not of the appeal…. At that instant the NEA was dead, we all knew that. Stop trying to pick a fight with Gary, he has his opinion, you have yours (and I happen to be firmly on YOUR side btw). Don’t keep bashing him in the head until he wholeheartedly agrees with you, because that’s not going to happen. Let it go!
nobody is bashing Gary.
I am not afraid of addressing him if that is who I am wanting to address.
Its a shame that overzealous judges and the DoJ killed this Alliance. (And I write that as a Biden voter) I am a consumer and have benefitted from it several times as an AA elite/customer, including a DEN-LGA redemption flight this coming Friday.
Don’t bother arguing with Tim. He is always correct on everything, and apparently has endless time in his life to argue everything.
@Tim,
Then address him (which you didn’t), don’t just try to obviously bait him while all of us roll our eyes!
I’m pretty sure the management teams at American and JetBlue can figure out what to do both short and long term. I’m reasonably sure they aren’t quite as stupid as Messrs. Dunn, Leff, and other armchair CEO’s scathing criticism would have readers believe. It’s easy to second guess a person’s decisions or actions when the observer knows what actually happened. As Howard Cosell often observed, “Hindsight is always 20-20.”
@Tim Dunn – Yes, I believe the facts support the American Airlines-JetBlue partnership being pro-consumer overall, though there were certain elements of it that the judge found problematic. I believe that was an anachronistic read of the law, but as I predicted far earlier it would be JetBlue that would walk away from an appeal.
However the point in *this* post is that ironically it’s JetBlue’s acquisition of Spirit that’s more clearly harmful to consumers! (That’s different than saying it violates anti-trust, though in certain readings everything violates anti-trust.)
Since the agreement, only AA flies from PHL-SJU and as a result I’ve been flying to NYC or DC. If this somehow restores the B6 flights SJU-PHL, which made that route competitive and affordable, then I’ll be pleased.
Gary,
my point – and it is NOT just directed at you because many make the same argument – is that the DOJ has made it clear that anti-competitive activity – which AA and B6 clearly engaged in as part of the construct of the NEA – is not justified just because it provides a stronger competitor to someone else.
and I do agree that there are elements of the B6-NK merger that are anti-competitive as well but it is possible to fix them IMHO. NK is a larger disruptor than B6 as much as B6 wants to believe otherwise.
And there were things that AA and B6 could do to work together that would fit the law but they are clearly choosing not even to do pursue those things – which is part of why it is clear the relationship between the two is dead. B6 is simply not willing to do anything w/ AA that would slow or stop its merger proposal w/ NK.
btw, I’m not sure that AA needs the NEA or that it will really make a difference for B6 or NK. Delta kicks off the earnings season tomorrow and analyst guidance is for all of the big 3 to report very strong earnings – far stronger margins that the low cost carrier segment and multiples higher margins than B6 and NK.
A combination of super strong demand, a desire for premium products which the big 3 can deliver, and high costs which the big 3 can absorb better than low cost carriers are swinging the balance in the airline industry more in favor of the big 3 than at any time since deregulation. It is the big 3 that are aggressively growing and generating margins and the LCCs and ULCCs are just barely holding on.
I’m an American flyer and live in NYC, and honestly… it was never relevant to me. My most frequent domestic destinations are STL, PHX, and LAX/SFO, all of which American serves directly. I’ve literally never been like, “man I wish I could book the JetBlue direct to this place, I really wish they were a partner.” I even got a call from Heather Samp back in 2021, I want to say, shortly after the first announcement, where she asked what I thought and whether I was excited to fly JetBlue, and my response in slightly politer terms was basically, “sure, I guess, if I ever find somewhere they go that I need to be…” I guess I should be sad that the loss of feeder passengers to their international flights will make that market harder, but the reality is that I pretty much always fly to London and then connect onward if I’m going to Europe as it is. Their direct flights to anywhere else are too few and infrequent, too lacking in upgrade availability or reasonably priced premium mileage inventory, to be worth it even with the alliance.
Always user blog have every thing and your best on this field buddy.
Thanks for the information.
Haha what Alan said!
AA need to just make JFK/LGA destination hubs with key business destination across the US, Europe and SA. Fill in with OneWorld partners and it will be a profit making #4 in the NYC market. Let’s DL and B6 and UA slug it out of the once a year travelers.
you kid yourself if you think that DL and UA don’t carry substantially higher percentages of business and premium revenue than AA in NYC
I can’t believe someone actually admitted they were a Biden voter
Sad to see it go. Flying my first AA flight on B6 today. Being AA gold, I got to board with the Mosaics and got a free even more space seat. I paid $400 to fly RT JFK-SLC booked last October. I doubt Delta, the main competitor on the route, could come anywhere close to matching that price.
I agree with other posters and Gary that JetBlue is fully consumed with their attempted merger with Spirit – which is highly uncompetitive (just take a look at the Caribbean and short-haul LatAm markets where there is no other carrier except for B6 and NK.
If the merger gets approved, I don’t think other carriers are going to jump into the short-haul fray from FLL – so these routes would then become monopolies.
For the well being of JetBlue I hope this merger does not get approved by DOJ – and I don’t think it will. Otherwise I think it could be the end of JetBlue as we know it.
FLLFLYER Which routes in LatAm are exclusively JetBlue or Spirit?
Yap! this is a good new for fatties and disable peoples.
The better outcome for consumers is to keep the NEA but perhaps with some adjustments. Then also blocking JetBlue’s purchase of Spirit so Frontier can pick them up.