Airline M&A

Delta Campaigns to Land More Airport Access


Updates 4th paragraph to add comments from Delta, United on asset sales.

Roughly five minutes after the Justice Department agreed to let American and US Airways (LCC) merge, Delta Air Lines (DAL) began angling for the chance to bid on some of the airport access the two carriers are being forced to sell. Delta, the nation’s second-biggest airline, said it “looks forward to the opportunity to acquire slots that will be divested,” particularly at Reagan National Airport near Washington, D.C., a US Airways hub and a lucrative destination for airlines due to the heavy flow of corporate and government travel.

William Baer, head of the Justice Department’s antitrust division, stressed that the settlement aims to foster new flights by low-cost airlines such as Southwest (LUV), JetBlue (JBLU), and Virgin America—not more access for behemoths like Delta and United. Another official in Baer’s office reiterated that position today. “Whether somebody wants to try to get assets, we’re not going to stop people from trying,” Renata Hesse told reporters. “But it’s hard for me to see how Delta and United would qualify.”

Delta certainly intends to try—and its proposed new service from Dallas is one way to do so. Today the airline said it would begin 18 new daily flights from Dallas Love Field in October 2014 to Detroit, Los Angeles, New York, and Minneapolis, if it can get the real estate it needs. “Delta will require access to gates at Love Field in order to operate its expanded schedule,” the airline noted in a news release aimed at nudging federal regulators to consider its bids.

Delta currently has daily flights from Love Field to Atlanta, subleasing its two gates from American. Delta spokesman Trebor Banstetter said in an email that the airline will “work with the airport and the city to secure additional space if needed.” The airport, north of downtown Dallas, is subject to flight restrictions to a handful of states under a federal law designed to protect Dallas-Fort Worth International Airport. That law, called the Wright Amendment, expires in October and will allow airlines to fly anywhere they choose. Southwest controls 16 of Love’s 20 gates and more than 95 percent of passenger traffic. United also has two gates at Love Field; a spokeswoman declined comment Thursday on whether that airline will seek any assets from American’s airport sales.

Delta argues that it is more nimble than smaller rivals at providing new flights. The Love Field news was the third straight day Delta has weighed in on its rivals’ merger, seeking to gain access from the terms of the settlement. “Delta believes that DOJ should not predetermine what communities will receive service with Reagan National slots or Love Field gates,” the airline said Wednesday, “and that it shouldn’t exclude any airline from the opportunity to bid for them.”

Bachman is an associate editor for Businessweek.com.

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  • DAL
    (Delta Air Lines Inc)
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