epartment of Justice challenges US Airways-AA merger
By Jerry Limone
The Department of Justice (DOJ) and six state attorneys general have filed an antitrust lawsuit challenging the proposed American Airlines-US Airways merger.
The participating attorneys general are from Texas, Arizona, Florida, the District of Columbia, Pennsylvania, Tennessee and Virginia.
The DOJ said that the merger “would substantially lessen competition for commercial air travel in local markets throughout the United States and result in passengers paying higher airfares and receiving less service.”
“This transaction would result in consumers paying the price — in higher airfares, higher fees and fewer choices,” U.S. Attorney General Eric Holder said in a statement. “Today’s action proves our determination to fight for the best interests of consumers by ensuring robust competition in the marketplace.”
According to the DOJ complaint, the merger would create the largest airline in the world and result in four airlines controlling more than 80% of the U.S. air travel market.
“The department sued to block this merger because it would eliminate competition between US Airways and American and put consumers at risk of higher prices and reduced service,” Bill Baer, assistant attorney general in charge of the DOJ’s Antitrust Division, said in a statement.
“If this merger goes forward, even a small increase in the price of airline tickets, checked bags or flight change fees would result in hundreds of millions of dollars of harm to American consumers. Both airlines have stated they can succeed on a standalone basis and consumers deserve the benefit of that continuing competitive dynamic.”
In 2010, Holder’s DOJ approved the United-Continental merger, which created an airline with the world’s largest fleet.
