In the context of the big news from the courts this week over the JetBlue-Spirit merger being blocked, should Alaska Airlines & Hawaiian Airlines be worried about their plans?
The proposed $3.8bn purchase has been struck down due to concerns over competition, as per reporting from CNBC.
Without further ado, let’s get into it…
U.S Judge Blocks JetBlue-Spirit Merger in the Courts…
The Justice Department has clearly got it’s point across regarding the JetBlue-Spirit merger, with them saying the following back in March:
“JetBlue’s plan would eliminate the unique competition that Spirit provides—and about half of all ultra-low-cost airline seats in the industry—and leave tens of millions of travelers to face higher fares and fewer options”.
JetBlue & Spirit Airlines sent AviationSource a joint statement on this week’s court ruling:
“We disagree with the U.S. District Court’s ruling.”
“We continue to believe that our combination is the best opportunity to increase much needed competition and choice by bringing low fares and great service to more customers in more markets while enhancing our ability to compete with the dominant U.S. carriers.”
“JetBlue’s termination of the Northeast Alliance and commitment to significant divestitures have removed any reasonable anti-competitive concerns that the Department of Justice raised.”
“We are reviewing the court’s decision and are evaluating our next steps as part of the legal process.”
Should Alaska-Hawaiian Be Worried About This Ruling?
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With this week’s news in mind, we ask the following question: Should Alaska Airlines & Hawaiian Airlines be worried about this news?
It is something to consider, especially with both sides announcing a combination earlier this month.
AviationSource approached both Alaska Airlines & Hawaiian Airlines on the news from this week, with not much being said on the matter.
A spokesperson for Alaska Airlines said the following on this:
“Today’s decision involving other airlines does not impact our plans to combine with Hawaiian Airlines.”
“Our deal combines two airlines with complementary networks and we believe the transaction will enhance competition and expand choice for consumers.”
Then on the islands, this is what was said:
“With regard to our proposed combination, we feel strongly that it offers compelling benefits to our employees, guests, communities and all stakeholders.”
Whether it’s the fact that it’s too early to call whether it will impact their plans or not is of course another question to be asked.
However, with President Biden’s DOJ taking a hard stance on such combinations, it depends whether Alaska Airlines & Hawaiian Airlines would fall under the same umbrella as JetBlue & Spirit in the reasons for the rejection of the merger.
Both sides will vote on the proposed combination next month.
Overall…
At this stage, it is unclear whether Alaska Airlines & Hawaiian Airlines should be worried about the news coming from the JetBlue-Spirit merger this week.
Based on the tone of comments sent to AviationSource, they don’t seem to be worried at the moment, but this is possibly due to the fact that no court proceedings have happened yet.
Looking ahead, all eyes will be on next month when the voting on the proposed combination takes place. If it is approved, then we will no doubt see what the next steps will look like.
One thing is for sure though, it will be an interesting year for Alaska Airlines & Hawaiian Airlines as they will now take the spotlight that JetBlue and Spirit have had over the course of last year.
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