SkyTeam - US DoJ againts the entry of Continental in Star Alliance (source: Aérocontact)

The U.S. Department of Justice (DoJ) has denied that Continental Airlines can benefit from its antitrust immunity in Star Alliance, and despite it had been approved by the Department of Transport (DoT).

According to the the U.S. Department of Justice (DoJ), the unconditional integration of Continental is problematic on several domestic and transoceanic lines: it would eliminate competition between Continental and United Airlines on transpacific and South America lines and reduce heavily competition to Beijing.

It could also become problematic for lines from Canada to New York, Lisbon to New York, Stockholm to Chicago, Frankfurt to Washington.

Continental and Star Alliance members continue to believe in the integration of the U.S. company. They should submit a new application. Continental is suposed to leave SkyTeam for Star Alliance on October 24.

Hi Nicolas,

The story is not quite as final:

http://www.atwonline.com/news/story.html?storyID=17077 (http://www.atwonline.com/news/story.html?storyID=17077).

The DoJ has voiced its opposition, but the DOT will take the final decision, and has the option of ignoring the DoJ's recommendation. The *Alliance have already filed a response to the DoJ report:

http://atwonline.com/news/story.html?storyID=17147

Apparently, although I can't find a link, AA has also submitted a response to the DoJ report, as it could have a similar stance for its application for immunity with BA.

We'll have to wait for the final answer from the DoT, although it is interesting to see some of the routes named by the DoJ:
harm to certain international routes, including routes between the US and China, routes spanning the US and Canadian border, and routes between the US and Denmark, Portugal, Sweden and Switzerland."

I can concur with the remarks about Switzerland, in particular GVA with UA/CO/LX flying directly to the US. However, are they such important markets as to fear for competition .. don't know.

Cheers,

GenevaFlyer

Jenkins of WSJ's on this move to block CO's move to *A:

http://online.wsj.com/article/SB124701148185808655.html

Jenkins of WSJ's on this move to block CO's move to *A:

http://online.wsj.com/article/SB124701148185808655.html

a small but important correction - DOJ are not trying to block COs move to *A , they are trying to block them having ATI with UA and a number of other *A carriers .

Not having ATI with their alliance partners would not prevent CO from joining *A any more than it prevented them being in Skyteam - although it would , of course , reduce the beneficial impact of that membership .

Looks like the US DOT is for it and has approved it:

http://www.continental.com/web/en-US/apps/vendors/default.aspx?i=PRNEWS

WASHINGTON, July 10 /PRNewswire-FirstCall/ -- The U.S. Department of Transportation (DOT) today approved the application for Continental Airlines (NYSE: CAL) to join the existing antitrust immunized alliance including United Airlines and eight other Star Alliance member carriers.

It could also become problematic for lines from Canada to New York, Lisbon to New York, Stockholm to Chicago, Frankfurt to Washington.

How is CO currently competing with UA on ORD-ARN?
Allowing CO to have an ATI with SK on ORD-ARN does not in any way reduce the number of flights or decrease competition on that route.

How is CO competing with UA on ORD-ARN?

they are not , but UA is not the only *A airline in the ATI , so is SK who do operate EWR-ARN in competition with CO .

they are not , but UA is not the only *A airline in the ATI , so is SK who do operate EWR-ARN in competition with CO .

How does your post address the statement by the previous poster that ORD-ARN would be affected by the ATI?

It turns out that the carve-out routes include EWR-ARN and EWR-CPH, routes that both SK and CO operate, but not ORD-ARN as previously stated in this thread.
Looks like someone took the statement "and routes between the US and Denmark, Portugal, Sweden and Switzerland" and interpreted it as meaning ORD-ARN, which of course made very little sense since CO doesn't operate that route.

How does your post address the statement by the previous poster that ORD-ARN would be affected by the ATI?



oops classic case of me reading what I expected to see rather than what was posted - since I knew that the ARN carve out was EWR I read EWR rather than ORD - doh !!!!