DOT rules Delta and US Airways must divest slots for approval of swap

U.S. Department of Transportation’s (DOT) (Washington) proposed rulemaking on the Delta Air Lines and US Airways’ previously announced slot transaction at New York’s LaGuardia and Washington’s Reagan-National airports  would require the airlines to divest 20 of the 125 slot pairs involved at New York-LaGuardia and 14 of the 42 slot pairs at Washington-National.

Both airlines expressed disappointment with the decision and issued this joint statement:

“Delta and US Airways are disappointed in the DOT’s decision that, if implemented, would negatively impact the consumer and economic benefits created by the proposed transaction by divesting 16 percent of the transaction at New York’s LaGuardia Airport and 33 percent of the transaction at Washington-National.  Chief among those benefits is the ability for both airlines to maintain and add new nonstop service between two of America’s top business markets and small- and medium-sized communities across the United States.

Our goal remains to increase access for customers in small communities to LaGuardia and Washington-Reagan National airports.  We appreciate the thousands of employees, customers and elected and community leaders who have voiced their support for our transaction. However, we expect that if this order is implemented as proposed the transaction will not go forward and significant consumer benefits will never be realized.  Both airlines will review the DOT’s proposed rulemaking to determine our next steps.”

Scott Kirby of US Airways told his employees “We are disappointed by the DOT’s decision”.

Kirby sited ways the ruling would hurt the company.  The ruling removed a significant portion of the proposed economic benefits. The DOT is asking both airlines to give up 16 percent of the proposed transaction at LGA and 33 percent of the transaction at DCA and they are severely limiting the potential field of airlines that can purchase the slots. The decision will also result in the loss of opportunity for the medium-sized communities that would have benefited from new service from both DCA and LGA as a result of this transaction.