Air Freight News

JetBlue-Spirit DOT action paused until “Antitrust Suit” is decided

Federal transportation regulators will decide whether to challenge JetBlue Airways Corp.’s purchase of Spirit Airlines Inc. only after the Justice Department’s lawsuit to block the deal is decided, setting up lengthy litigation over the deal.

Transportation Secretary Pete Buttigieg said in an interview with Bloomberg Monday that his agency is looking at all potential avenues to inject competition into the airline industry after decades of consolidation.

Last week, the Justice Department sued to block the $3.8 billion takeover while transportation officials said they would deny JetBlue and Spirit’s request to operate as a single carrier while awaiting final approval of the deal. The transportation agency also opened an investigation into whether the acquisition violates rules governing unfair and deceptive practices or unfair competition.

It’s important “for us to use all of the tools that we have as an administration, including those that are in the DOT toolkit, when it comes to competition issues,” Buttigieg said in an interview with Bloomberg. “We’re looking at everything we can do.”

The agency hasn’t used its authority to block the transfer of a certificate — the formal federal approval to operate aircraft and carry passengers — among major airlines since the industry was deregulated in 1978. The airlines added an extra six months to the deal’s timeline in anticipation of litigation by the Justice Department, but Buttigieg didn’t say how long additional federal scrutiny from his agency could last.

“We’re going to be using our own tools to examine the public interest issues at play,” Buttigieg said of the proposed takeover. Should the deal still “remain on the table after the DOJ’s case is acted on, that’s where we’re gonna reach for that.”

JetBlue said earlier it would “vigorously pursue” any change in the Transportation Department’s approach to takeovers and certificate transfers over the past 30 years and that it was confident a federal judge “will recognize the merits” of the deal.



© Bloomberg
The author’s opinion are not necessarily the opinions of the American Journal of Transportation (AJOT).

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