US carriers cancelled more than 2000 services on 4-Feb-2011 due to the ongoing snowstorm, taking the total cancelled services for the week past 18,500 (AP/Reuters/The Business Journal, 3-Feb-2011). Chicago O’Hare International Airport has reportedly been the worst affected with United Airlines, Delta Air Lines and American Airlines all suspending operations at the airport. General Mitchell International Airport was forced to close on 2-Feb-2011 but has reopened 3-Feb-2011.
US carriers cancel more than 18,500 services due to snowstorm
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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.
Delta-Korean Air joint venture creates trans-Pacific's second largest bloc. Cathay, EVA under threat
The unprecedented aviation market growth between Asia and North America is forcing airlines to re-evaluate their core strategy and reassess who is a competitor and who could be a partner. It seems probable that Delta Air Lines and Korean Air will form a joint venture, potentially making them the second largest trans-Pacific bloc.
The next two largest airlines without a deep partnership, EVA Air and Cathay Pacific, are having to confront significant change, without the support of partners. Delta-Korean Air brings United-ANA its closest rival yet, while the American-JAL JV – already smaller – needs bulking up.
Korean Air brings Delta a wider network in Asia than ANA or JAL offer to their respective JV partners, United and American. A Korean Air-Delta JV could result in more destinations and flights being added once they are able to sell jointly.