Originally Posted by
diver858
1. I am having difficulties understanding the SEA divestment rationale; DL made a big, unsuccessful push to challenge AS in SEA, State of Alaska; AA had grandiose plans to provide TPAC service out of SEA, partnering with AS, also failed; WN already has a presence in both SEA and PHX.
2. All major carriers offer robust mainland US-Hawaii flights, have been cutting back on capacity, combined AS-HA will not have the ability to disrupt pricing.
3. ALK should have expected some conditions related to inter-island service: open code-shares, minimum levels of service would not be a surprise to anyone. WN will have to stop burning cash at some point, but keep AS-HA honest if fares jump too much.
4. Longer term, DL and UA have the most to lose TPAC, as ALK repurposes HA A330s and 787s, leveraging the OW network. This should have the effect of adding competition, reducing prices for consumers, which should be music to regulator's ears. This is where I could see competing lobbyists attempting to exert pressure, with little to no success.
HA offers non-stop flights to the mainland that other airlines do not compete on with their own non-stops (i.e. HNL-AUS, HNL-ONT). The fear would be that AS would cut those routes so that they could redeploy the aircraft on more profitable routes and force the traffic to those destinations through hubs. If AS were to cut HNL-AUS, and force the traffic from that daily flight through SEA, that increases demand for HNL-SEA and SEA-AUS. As capacity constrained as SEA is, there would not be an increase in supply to meet demand, so the prices would have to increase. That would impact anyone who is traveling from HNL to/from AUS or anyone who is connecting through SEA to get to/from HNL or AUS.
Is that a realistic scenario? I don't know. But that is what the DOJ would be assessing and trying to protect against.
With capacity constraints at SEA, there is no guarantee that AS could add TPAC flights out of SEA. If AS does add flights to SEA, would that negatively impact the quality of service passengers experience (more delays, longer lines, etc) even if the price is cheaper? In addition to prices consumers pay, the DOJ also analyzes the quality of experience for consumers in their decision to challenge a merger or not.