DOJ says JetBlue and Spirit merger would harm millions of Americans
The Biden-Harris administration is heading to court to stop JetBlue from purchasing Spirit Airlines Inc. to protect consumers from surging The post DOJ says JetBlue and Spirit merger would harm millions of Americans appeared first on TheGrio.
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JetBlue’s deal would “hurt those travelers who can least afford to see travel costs rise,” said Vanita Gupta, Department of Justice associate attorney general.
The Biden-Harris administration is heading to court to stop JetBlue from purchasing Spirit Airlines Inc. to protect consumers from surging airfare prices.
In a press release that theGrio obtained, the Department of Justice stated, the merger would hurt “working and middle-class families” who will not be able to afford price increases.
The agency said, travelers “may no longer be able to afford to travel at all.”
JetBlue CEO Robin Hayes told USA Today that he is “disappointed” in the DOJ’s decision to disrupt the acquisition.
On Tuesday, the justice department, Attorneys General of the Commonwealth of Massachusetts, the District of Columbia and the State of New York filed a civil antitrust suit to block JetBlue from acquiring Spirit Airlines for $3.8 billion. The DOJ believes if the two airlines merge it would increase airfare for the average consumer and limit flying options for many Americans.
In the complaint, the DOJ asserts that the merger would eradicate the “’Spirit Effect,’ whereby Spirit’s presence in a market forces other air carriers, including JetBlue, to lower their fares.”
Most airlines like American, Delta and United offer “basic economy” alternatives to higher-priced airfare. Doha Mekki, DOJ principal deputy assistant attorney general said those rates were a result of “disruptive choices Spirit made,” prompting other airlines to respond.
If the merger prevails, major airline companies will no longer feel pressured to present low-cost flight options to consumers.
During a press conference on Tuesday, Associate Attorney General Vanita Gupta told reporters that budget airlines “like Spirit play a key role in the economy” and JetBlue’s deal would jeopardize that.
Attorney General Merrick Garland said another one of the department’s major concerns is that the merger would disrupt competition in the airline industry because JetBlue and Spirit service many of the same routes.
“For example, on the Boston-Miami/Fort Lauderdale route, which serves about 1.5 million passengers annually, JetBlue and Spirit together currently account for nearly 50% of the market” and “for service between Boston and San Juan, the two airlines account for nearly 90%” of the market, he said.
Garland said “eliminating the competition between JetBlue and Spirit” would cause harm to consumers.
Mekki warned that if JetBlue is able to acquire the low-budget airline, those seeking low fares and desire “more control over how they spend their money will no longer have a chance to choose Spirit’s low-priced, unbundled fares.”
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