US Airways Group Inc. shouldn’t have to cede Washington flight slots after merging with American Airlines because the new carrier won’t control an unreasonable amount of service, Chief Executive Officer Doug Parker said.
“Absolutely not,” Parker told a U.S. Chamber of Commerce aviation conference today when asked about possible divestitures. “It is an incredibly competitive market in the D.C. area. There is no reason for us to divest slots, legally or otherwise.”
The combination of US Airways and AMR Corp.’s American will have only 25 percent of the aircraft seats in a Washington market that includes Washington Dulles International and Baltimore/Washington International Thurgood Marshall airports, said Parker, who will become CEO of the new American.
U.S. regulators limit takeoff and landing slots at Ronald Reagan Washington National Airport, where US Airways says the post-merger American will have 67 percent of daily departures. Parker spoke after JetBlue Airways Corp. CEO Dave Barger said the merged airline should have to give up flights in Washington as part of their deal.
“It is not right for one airline to have two-thirds of the slots at one airport,” Barger said in an interview at the conference. “We feel very strongly about this.”
Barger urged the U.S. government to order the post-merger American to surrender an unspecified number of flight slots that would be auctioned to other carriers. New York-based JetBlue wants to expand its operations in Washington, he said.
Barger said he’s not opposed to the merger because he believes further consolidation within the airline industry is needed.
If Reagan National divestitures are mandated, it would mean less service to the smaller airports where Tempe, Arizona-based US Airways now flies, Parker said.
“The net result would be for consumers a reduction in non-stop service to small- and mid-size communities and the slots being given to airlines that would fly them to other markets that already have a lot of service,” he said.
JetBlue, Southwest Airlines Co. and two other carriers won slots at Reagan National last year, in the first such addition of flights there since 2004. Reagan is the only airport outside New York where regulators control access, and most flights are limited to a 1,250-mile (2,000-kilometer) radius.
The American brand will remain in place after the merger, as well as that carrier’s headquarters in Fort Worth, Texas.
The proposed airline combination, which would create the world’s largest carrier, won approval from a U.S. bankruptcy judge yesterday. The Justice Department’s antitrust division earlier this month asked for more information from the companies, which project a third-quarter closing for their deal.