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Branson weighs in on JAL-Delta-American offerings


Sir Richard Branson has called the bidding process between American and Delta for JAL “hypocritical” compared to the proposed British Airways/American deal. He pointed out oneworld’s contention that a JAL/DL deal would “raise intractable competition issues and face severe regulatory opposition.” Branson also quoted American CEO Gerard Arpey’s comment that would be “zero chance of DL/JAL receiving ATI (anti-trust immunity).”

"Oneworld's approach to the potential JAL/Delta transpacific alliance is hypocritical in the extreme,” Branson said. “BA and AA's arguments against the JAL/Delta transpacific alliance read like a carbon copy of our longstanding objections to a BA/AA transatlantic alliance. The only difference is that BA/AA poses a far greater competition issue and risk to consumers than JAL/Delta."

He reiterated his objection to the transatlantic ATI with the usual soundbites – BA and AA, along with its alliance partners, would hold 47 percent of Heathrow slots and overlap in six Heathrow-U.S. markets with sky-high market shares: Dallas Fort-Worth (100%); Boston (80%); Miami (70%); Chicago (67%); New York JFK (64%) and Los Angeles (48%).

“Comparatively JAL/Delta would hold 40% of Narita slots and overlap in three Narita-mainland U.S. markets: New York JFK (60%); San Francisco (44%) and Los Angeles (36%),” said Branson.

Branson’s comments came as oneworld filed comments with the Department of Transportation calling for the it to reject objections made by the Department of Justice. “Furthermore BA's offer to transfer slots at Heathrow to Japan Airlines, in an effort to keep it in the alliance, puts forward more evidence that Heathrow Airport is effectively closed,” said Branson.

He added, "earlier this week, in an effort to keep Japan Airlines with the alliance, a deal was offered to JAL which apparently included slots at the airport. The total value ascribed to the deal was USD200 million. This figure speaks volumes about how difficult it is to gain access to well-timed Heathrow slots. BA's CEO Willie Walsh himself told financial analysts last year that Heathrow is "full", yet in their submission to the US regulators in relation to BA and AA, they continue to claim it is an open airport and slots access poses no barrier to competitive entry. If we apply oneworld's own JAL/Delta antitrust immunity test to BA/AA, it is irrefutably clear BA/AA should be rejected, and rejected outright. Oneworld's double standards in its fight for Japan Airlines is breathtaking."

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