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Tue November 12, 2013
Justice Department OKs American Airlines-US Airways Merger
Update, 12:43 p.m.: The Justice Department has reached an agreement to allow the merger of U.S. Airways and Fort Worth-based American Airlines. American and U.S. Air will have to reduce their presence at certain large airports across the country. They'll have to give slots and gates to low-cost carriers at Dallas Love Field, Boston Logan, Chicago O’Hare, Los Angeles International, Miami International, New York LaGuardia and Ronald Reagan Washington National.
“This agreement has the potential to shift the landscape of the airline industry,” U.S. Attorney General Eric Holder said in a news release. “By guaranteeing a bigger foothold for low-cost carriers at key U.S. airports, this settlement ensures airline passengers will see more competition on nonstop and connecting routes throughout the country. The department’s ultimate goal has remained steadfast throughout this process - to ensure vigorous competition in airline travel. This is vital to millions of consumers who will benefit from both more competitive prices and enhanced travel options.”
In August, the government, along with several states, including Texas, had sued to block the merger, saying it would restrict competition and drive up prices for consumers on hundreds of routes around the country. The airlines had said their deal would increase competition by creating another big competitor to United Airlines and Delta Air Lines, which grew through recent mergers.
In a news release, American and U.S. Air said they will divest 52 slot pairs at National Airport and 17 slot pairs at LaGuardia. The airlines also will divest two gates and support facilities at Dallas Love Field, as well as at Boston Logan, Chicago O’Hare, LAX and Miami International.
The combined company expects to operate 44 fewer daily departures at National Airport and 12 fewer daily departures at LaGuardia.
In October, the state of Texas dropped its opposition to the American Airlines-U.S. Airways merger. Texas Attorney General Greg Abbott had reached an agreement that will keep American’s headquarters in North Texas and maintain DFW as a “large hub airport.” American will also maintain daily service to more than 20 airports across Texas, many serving rural parts of the state. The October announcement marked an about-face for Abbott, who in August said the merger would have violated antitrust laws. Here's what KERA reported in October.
Abbott said in October that he dropped his opposition to the merger after making sure that American, which is based in Fort Worth, continues serving rural communities across Texas. Military members rely on American Eagle airplane service to and from Killeen, near Fort Hood; San Angelo, which is near Goodfellow Air Force Base; and Abilene, which is near Dyess Air Force Base.
"Our first and foremost concern was ongoing service to rural communities," Abbott said in October.
Texas was among several states and the District of Columbia that were part of the Justice Department’s antitrust suit to try to block the merger. The other states include Arizona, where U.S. Airways is headquartered; Florida, Pennsylvania, Tennessee and Virginia.
Original post: The Justice Department has reached an agreement to allow the merger of US Airways and Fort Worth-based American Airlines, the Associated Press is reporting. We'll update this post as we learn more.