American Airlines and JetBlue have been ordered to discontinue their so-called Northeast Alliance, following a ruling by the Massachusetts US District Court.
The two carriers first announced the strategic partnership in July 2020 during the height of the Covid-19 pandemic, allowing them to coordinate flight schedules and share revenue on selected routes.
At the time the airlines said that the alliance would “create seamless connectivity for travellers in the Northeast and more choice for customers across their complementary domestic and international networks”.
American Airlines and Jetblue announce strategic partnership
But the US Justice Department sought to end the agreement, which it called a “de facto merger” of the carriers’ Boston and New York operations, and US District Judge Leo Sorokin ruled in favour of the administration, stating in his conclusion that:
“These two powerful carriers act as one entity in the northeast, allocating markets between them and replacing full-throated competition with broad cooperation.”
The order means that AA and JetBlue must end their alliance within 30 days.
Commenting on the news Attorney General Merrick B. Garland said:
“Today’s decision is a win for Americans who rely on competition between airlines to travel affordably, The Justice Department will continue to protect competition and enforce our antitrust laws in the heavily consolidated airline industry and across every industry.”
Reuters quotes American Airlines as stating in response that “The court’s legal analysis is plainly incorrect and unprecedented for a joint venture,” adding that the alliance “has been a huge win for customers and anything but anticompetitive.”