http://atwonline.com/regulation/dot-tentatively-approves-delta-virgin-transatlantic-tie
Delta Air Lines and Virgin Atlantic Airways have received US Dept. of Transportation (DOT) backing for their planned transatlantic joint venture (JV).
The deal, which was announced *****Dec. 11, 2012, had already been cleared by the US Dept. of Justice***** and the European Commission. However, DOT has the final say on whether the proposed transatlantic JV gains antitrust immunity, similar to that enjoyed by American Airlines, British Airways and Iberia.
“We tentatively conclude that, overall, the alliance will be pro-competitive,” DOT said in a regulatory filing. The investigation revealed no route overlap between the two airlines and concluded that the deal will strengthen US-Europe and US-UK inter-alliance competition.
Delta and Virgin also “made a strong showing” of public benefits from the deal, including the potential for strengthened schedules on their network. “We tentatively conclude that antitrust immunity is necessary to achieve most of these important benefits,” DOT said. “We tentatively conclude that the potential benefits of the application outweigh any potential harm.”
There is a 14-day period for comments.
Delta and Virgin plan to coordinate on network planning, revenue management, pricing, sales and other functions through the metal-neutral transatlantic JV, which will include revenue and profit sharing.
Delta is already a member of SkyTeam’s transatlantic JV; the two JVs will be managed separately.
Delta Air Lines and Virgin Atlantic Airways have received US Dept. of Transportation (DOT) backing for their planned transatlantic joint venture (JV).
The deal, which was announced *****Dec. 11, 2012, had already been cleared by the US Dept. of Justice***** and the European Commission. However, DOT has the final say on whether the proposed transatlantic JV gains antitrust immunity, similar to that enjoyed by American Airlines, British Airways and Iberia.
“We tentatively conclude that, overall, the alliance will be pro-competitive,” DOT said in a regulatory filing. The investigation revealed no route overlap between the two airlines and concluded that the deal will strengthen US-Europe and US-UK inter-alliance competition.
Delta and Virgin also “made a strong showing” of public benefits from the deal, including the potential for strengthened schedules on their network. “We tentatively conclude that antitrust immunity is necessary to achieve most of these important benefits,” DOT said. “We tentatively conclude that the potential benefits of the application outweigh any potential harm.”
There is a 14-day period for comments.
Delta and Virgin plan to coordinate on network planning, revenue management, pricing, sales and other functions through the metal-neutral transatlantic JV, which will include revenue and profit sharing.
Delta is already a member of SkyTeam’s transatlantic JV; the two JVs will be managed separately.