North Atlantic airline market. Closed JVs to have 78% of ASKs in 2016. Weighing the benefits

When the regulators approved metal-neutral joint ventures over the North Atlantic, initially involving major airlines in the three global alliances (the JV between Delta and Virgin Atlantic came later), the justification was that they would be in the public interest. In general, the so-called immunised joint ventures have encouraged better capacity and frequency coordination, and a convergence of product and service quality towards that provided by the superior partner (although there is still room for improvement in many cases).

Schedules data from OAG indicate that 78% of North Atlantic ASKs will be operated by these JVs in summer 2016 (assuming that Aer Lingus joins oneworld and its JV). Although airlines outside the JVs are growing their share - led by LCCs, airlines owned by leisure groups and Turkish Airlines - this high concentration illustrates the impact that the JVs have had on reducing competition.

This report examines historical North Atlantic capacity trends and considers some of the issues discussed by a panel at CAPA's Airlines in Transition (AIT) conference in Dublin in Mar-2016, moderated by John Byerly, a former Deputy Assistant Secretary for Transportation at the US State Department.