When the Justice Department, six states (including Texas) and the District of Columbia filed an antitrust suit back in August trying to stop the merger of American Airlines and US Airways, they included strong language about anti-competitive behavior after other large airline mergers.
Now Justice and the states (including Texas) have settled that litigation, and the one major concession they got from American and US Airways was that the merged carrier will give up takeoff and landing slots at some major airports. Justice said those slots would go to “low-cost” carriers, meaning airlines like Southwest and Spirit.
American was also required to give “low-cost” carriers its rights to operate two gates at Dallas Love Field. So far, though, it’s hard to see where the Justice Department or even American gets to make that decision.
Dallas owns Love Field, and city officials control how the gates are allocated.
Delta Air Lines, one of the three large “legacy” carriers in the U.S. once the American-US Airways merger is done, wants to bid on the two Love Field gates.
William Baer, the assistant attorney general who heads the Antitrust Division and was lead attorney on the American-US Airways suit, has discouraged the Delta bid.
The settlement papers, Baer said, “make it pretty clear where we think these gates and slots need to go in order to improve on a competitive dynamic today, which is not as healthy as it could be.”
He may be right, but that doesn’t give Justice or any other part of the federal government the decision-making power on Love Field gates.
The Federal Aviation Administration controls takeoff and landing slots at some airports, like Reagan National in Washington, D.C., and LaGuardia in New York City, but not gates.
Dallas agreed to limit Love Field to 20 gates as part of the 2006 compromise lifting Wright Amendment limits on flights. Dallas must be fair to all carriers wanting gate space.
It’s not a federal decision.