ANA President, Shinichiro Ito, stated ANA and its Star Alliance partners, United Airlines and Continental Airlines would file for antitrust immunity with US authorities this week (The Asahi Shimbun, 21-Dec-2009).
ANA, United Airlines and Continental Airlines to file for antitrust immunity this week
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Avianca Airline Group seeks investors to maintain position in a changing Latin American landscape
The decision to merge by Avianca and Grupo TACA in 2009 is what kickstarted consolidation in Latin America. The merger of the two companies, now operating as Avianca Holdings, arguably triggered the combination of LAN and TAM to create LATAM – the region’s most powerful grouping of airlines.
As Avianca and TACA and LAN and TAM were integrating their respective operations, other South American airlines garnered investment from foreign airlines – SkyTeam partners Air France-KLM and Delta invested in the independent Gol, and United and HNA Group took stakes in Azul.
Now Avianca is seeking a strategic investing partner, and many airlines are reportedly interested in obtaining a stake in the company. The investment will allow Avianca to weather difficult near term economic conditions and remain on equal footing with its competitors, while the company’s suitor obtains strategic positioning in one of most important growth markets – Latin America – for the next decade and beyond.
US DOT rejects Qantas-American Airlines joint venture under pressure of unchecked consolidation
After complaints about airlines amassing power through joint ventures to the detriment of consumers, the US DOT appears to be exerting greater and more conservative scrutiny on partnerships. DOT has rejected a proposed JV between American Airlines and Qantas. After DOT declined their request for a much longer response time American and Qantas withdrew their application, submitted in Jun-2015.
At a top level the JV does seem to raise concern: combined, Qantas and American would hold 59% of the US-Australia market. Yet almost all of that – 53% – is from Qantas; American adds only 6ppt.
DOT rejects the notion that such larger market share can possibly be in the interest of consumers. Yet it appears to overlook the benefit American might bring in exchange for incremental market share gains. Nor is it clear if this combination is more anti-competitive than some JVs where two airlines, each with a small- or medium-sized position, combine and become multiples larger. Qantas' 53% market share was earned through quality and smart loyalty programme development while competitors lagged.
Qantas will continue growth in North America, its most successful international market, but American Airlines' growth is uncertain and it may re-evaluate a supposedly planned Los Angeles-Melbourne 787 service.