- The Washington Times - Tuesday, December 18, 2001

The Justice Department yesterday recommended against approval of an alliance between American Airlines and British Airways, saying the deal would threaten competition.
The alliance as proposed "threatens a substantial loss of competition, which would likely result in higher air fares and reduced service," the department said.
American had sought antitrust immunity to seek a marketing alliance with British Airways. Such an alliance would let the carriers coordinate fares and routes and sell each other's tickets.
The Justice Department plans to oppose the deal unless the Transportation Department, which will ultimately approve or reject it, requires the airlines to give up flights so that competitors can offer round-trip service to London's Heathrow Airport from New York and Boston.
American and British Airways currently compete head-to-head, offering nonstop service to London from Boston, New York, Miami, Chicago, Dallas and Los Angeles. Their combination would give them well over 50 percent of the flights in most of these markets, and an even higher share of business travelers.
According to the Justice Department, the scarcity of slots at Heathrow makes entry by other airlines into most of these markets unlikely. To remedy the harm in two of the markets, New York-Heathrow and Boston-Heathrow, the Justice Department recommended that DOT require American and British Airways give up enough slots and related facilities to allow new entrants to offer seven daily round trips from New York and two from Boston. These would replace the flights American currently offers in those markets.
As part of the same proceeding, the Justice Department declined to oppose the grant of antitrust immunity to a proposed alliance between United Airlines and British Midland Airways. Noting that British Midland is not currently a potential competitor in U.S.London markets, Justice concluded that approval of its alliance with United would not reduce competition.

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