American and JetBlue flights prepare to take off at Los Angeles International Airport, Jan. 11, 2023.
Carolyn Cole | Los Angeles Times | Getty Images
JetBlue Airways said Wednesday that it should end its partnership within the northeast U.S. with American Airlines after a federal judge ruled to dam the agreement because the Recent York airline focuses on its acquisition of Spirit Airlines as an alternative.
American said last month that it might challenge the ruling against the JetBlue partnership, but Recent York-based JetBlue said Wednesday it might not appeal the choice.
“Despite our deep conviction within the procompetitive advantages of the NEA, after much consideration, JetBlue has made the difficult decision to not appeal the court’s determination that the NEA cannot proceed as currently crafted,” JetBlue said in an announcement.
JetBlue said it has began terminating the agreement, “a wind down process that can happen over the approaching months.” JetBlue said it should “now turn much more focus to our proposed combination with Spirit.”
JetBlue’s deal to purchase Spirit got here together after JetBlue and American launched a partnership within the Northeast. The so-called Northeast Alliance, approved in the course of the last days of the Trump administration, allows the 2 carriers to share passengers and revenue and to coordinate schedules.
But a federal judge ruled in May that that partnership was anticompetitive, ordering the 2 airlines to undo the alliance.
American Airlines said Wednesday that it should still appeal the ruling.
“JetBlue has been an ideal partner, and we are going to proceed to work with them to make sure our mutual customers can travel seamlessly without disruption to their travel plans,” American said in an announcement on its website.
A spokesman for the airline didn’t immediately say how American could salvage the deal if JetBlue plans to start unwinding it.
“We, after all, respect JetBlue’s decision to give attention to its other antitrust and regulatory challenges.”
JetBlue won the deal to accumulate Spirit in July 2022 after a bidding war with low-cost rival Frontier Airlines. JetBlue has argued it needs Spirit in an effort to grow and higher compete against larger airlines that dominate domestic air travel. The combined carrier would grow to be the country’s fifth-largest.
The acquisition of Spirit would give JetBlue access to more aircraft at a time when manufacturers are struggling to maintain up with demand. It could also gain access to a whole lot of pilots, that are also briefly supply.
From the beginning that deal has faced a high hurdle from the Biden administration, which has vowed to challenge deals it finds harm competition.
The Justice Department sued to dam the deal in March, arguing that the “unique competition that Spirit provides — and about half of all ultra-low-cost airline seats within the industry — and leave tens of tens of millions of travelers to face higher fares and fewer options,” if the airline merged with JetBlue.
Spirit shares were up greater than 2% in afterhours trading, while American and JetBlue were each down lower than 1%.