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Star Alliance Antitrust  
User currently offlineERJ170 From United States of America, joined Apr 2004, 6729 posts, RR: 18
Posted (5 years 9 months 1 day 17 hours ago) and read 2707 times:

Looks like CO is getting in on the ground floor..

Request for a 10-way antitrust that includes CO, UA, and 8 other Star Alliance Members..

In addition, CO, UA, LH, and AC have requested a TATL venture.

No mention of US anywhere.. hmm

Article here

One more thing.. tucked in the article it states that CO and UA hope to be able to offer a broad codeshare on their domestic routes also. Again, no mention of US which already codeshares with UA.

[Edited 2008-07-23 12:52:52]


Aiming High and going far..
13 replies: All unread, jump to last
 
User currently offlineYOWza From Canada, joined Jul 2005, 4845 posts, RR: 15
Reply 1, posted (5 years 9 months 1 day 15 hours ago) and read 2513 times:

I think the brains at *A should focus on getting partners intra-South America and stop fooling around with stunts like this.

YOWza



12A whenever possible.
User currently offlineAvek00 From United States of America, joined Oct 2004, 4282 posts, RR: 20
Reply 2, posted (5 years 9 months 1 day 15 hours ago) and read 2477 times:

Quoting ERJ170 (Thread starter):
No mention of US anywhere.. hmm

US is mentioned within the actual DOT filings. There are NO plans for US, Asiana, Air New Zealand, or COPA to join the immunized agreement.

Quoting YOWza (Reply 1):
I think the brains at *A should focus on getting partners intra-South America and stop fooling around with stunts like this.

The DOT filing is not a stunt but rather a necessity to enagge in measures to produce real synergies in key competitive markets. And without the approval of the A++ (Atlantic Plus-Plus) UA/LH/CO/AC agreement, the parties will not move forward on further cooperation.

[Edited 2008-07-23 15:20:07]


Live life to the fullest.
User currently offlineCommavia From United States of America, joined Apr 2005, 11121 posts, RR: 62
Reply 3, posted (5 years 9 months 1 day 14 hours ago) and read 2399 times:

Trans-Atlantic consolidation (albeit limited, in the form of antitrust immunity) is in full-swing across the Atlantic and I think that will ultimately be a net-positive for consumers and the market. International competition these days, in particular between the U.S. and Europe, is becoming dominated by alliances rather than individual airlines, and as such it makes sense for these airlines to try and form immunized blocs to function in a unified way.

That being said, this deal should absolutely not happen if AA+BA+IB does not also get antitrust immunity. The Star Alliance carriers in question here offer almost double the amount of capacity across the Atlantic as the oneworld bloc, and have far more dominant market concentrations in every one of their European home markets than AA-BA-IB.

I'm all for antitrust immunity across the Atlantic, as long as its fair.


User currently offlineStarGoldLHR From Heard and McDonald Islands, joined Feb 2004, 1529 posts, RR: 1
Reply 4, posted (5 years 9 months 1 day 13 hours ago) and read 2314 times:



Quoting Commavia (Reply 3):
That being said, this deal should absolutely not happen if AA+BA+IB does not also get antitrust immunity. The Star Alliance carriers in question here offer almost double the amount of capacity across the Atlantic as the oneworld bloc, and have far more dominant market concentrations in every one of their European home markets than AA-BA-IB.

Not from the UK they dont.

Who are the other 8 Star Alliance members in this venture then ?

SQ/TG one of them ?

or is it a consolidation of Star Alliance Europe (LO/OS/SK/BD etc ?)



So far in 2008 45 flights and Gold already. JFK, IAD, LGA, SIN, HKG, NRT, AKL, PPT, LAX still to book ! Home Airport LCY
User currently offlineCommavia From United States of America, joined Apr 2005, 11121 posts, RR: 62
Reply 5, posted (5 years 9 months 1 day 12 hours ago) and read 2240 times:



Quoting StarGoldLHR (Reply 4):
Not from the UK they dont.

Yes, they do.

In every single one of the Europe-U.S. national markets in which a Star airline is based, Star is a more dominant position than AA-BA would have in the U.K.-U.S. market.

Based on today's schedules, minus announced upcoming capacity reductions:

Austria-U.S.: 100% of the market
Denmark-U.S.: 82.9% of the market
Germany-U.S.: 84.6% of the market
Norway-U.S.: 100% of the market
Poland-U.S.: 100% of the market
Portugal-U.S.: 74.3% of the market
Spain-U.S.: 26.7% of the market
Sweden-U.S.: 65.8% of the market
Switzerland-U.S.: 84.9% of the market
Turkey-U.S.: 70.2% of the market

For comparison:

AA+BA U.K.-U.S.: 46.0% of the market

The only exception is Spain-U.S., where another oneworld pairing, AA and Iberia, presently hold the majority - barely - of the market, with 50.6% of the capacity - still lower than any other Star pairing's combined national market concentration besides Spain.

And, anticipating the logical next question - "yeah, but what about London-U.S. specifically?" - the same still holds true: the combined market concentration of AA+BA is still less than any other immunized Star carriers in a home U.S.-Europe market:

AA+BA London (Overall)-U.S.: 50.3% of the market
AA+BA Heathrow ONLY-U.S.: 56.2% of the market

Austria/Vienna-U.S.: 100% of the market
Denmark/Copenhagen-U.S.: 82.9% of the market
Germany/Frankfurt-U.S.: 87.9% of the market
Germany/Munich-U.S.: 92.7% of the market
Norway/Oslo-U.S.: 100% of the market
Poland/Warsaw-U.S.: 100% of the market
Portugal/Lisbon-U.S.: 89.3% of the market
Spain/Madrid-U.S.: 20.5% of the market
Sweden/Stockholm-U.S.: 65.8% of the market
Switzerland/Zurich-U.S.: 82.0% of the market
Turkey/Istanbul-U.S.: 70.2% of the market

So, once again, the only outlier to the pattern is Spain (Madrid)-U.S., and even there, the market concentration of oneworld airlines AA and Iberia - 64.9% - is lower than any Star pairing's market concentrations in their home national markets.

*These numbers include all Star Alliance members in the U.S.-Europe market, plus soon-to-join Continental, since we don't yet know which 8 additional Star members are part of this application beyond United and Continental

I have no problem with Star getting this immunity but there is simply no reason for AA and BA not to get their immunity.


User currently offlineJoFMO From Germany, joined Jul 2004, 2211 posts, RR: 0
Reply 6, posted (5 years 9 months 1 day 10 hours ago) and read 2136 times:



Quoting Commavia (Reply 5):
In every single one of the Europe-U.S. national markets in which a Star airline is based, Star is a more dominant position than AA-BA would have in the U.K.-U.S. market.



Quoting Commavia (Reply 5):
AA+BA London (Overall)-U.S.: 50.3% of the market
AA+BA Heathrow ONLY-U.S.: 56.2% of the market



Quoting Commavia (Reply 5):
Austria/Vienna-U.S.: 100% of the market
Denmark/Copenhagen-U.S.: 82.9% of the market
Germany/Frankfurt-U.S.: 87.9% of the market
Germany/Munich-U.S.: 92.7% of the market
Norway/Oslo-U.S.: 100% of the market
Poland/Warsaw-U.S.: 100% of the market
Portugal/Lisbon-U.S.: 89.3% of the market
Spain/Madrid-U.S.: 20.5% of the market
Sweden/Stockholm-U.S.: 65.8% of the market
Switzerland/Zurich-U.S.: 82.0% of the market
Turkey/Istanbul-U.S.: 70.2% of the market

I don't think any of theses markets really should be matter of concern. Even where some airlines hold 100%, these markets are generally very small.

The only market the DOT has to address is LHR-NYC (and maybe LHR-BOS). These are huge markets and a combined AA+BA will dominate them by large. It would be nice if Commavia could provide us with numbers for these markets. I would assume that AA+BA have around 70-80% of the LHR-NYC market. This number concerns me more than the 100% LHR-DFW.
I could see that the DOT requires BA+AA to give up some slots of the NYC market or exclude this specific route from ATI.


User currently offlineCommavia From United States of America, joined Apr 2005, 11121 posts, RR: 62
Reply 7, posted (5 years 9 months 1 day 10 hours ago) and read 2111 times:



Quoting JoFMO (Reply 6):
It would be nice if Commavia could provide us with numbers for these markets. I would assume that AA+BA have around 70-80% of the LHR-NYC market. This number concerns me more than the 100% LHR-DFW.

Happily ...

In the admittedly critical New York-London market (and I'm including both Newark and JFK and both Heathrow and Gatwick since its impossible to separate them in either respective market) ...

AA+BA controls a grand total of 54.1% of the capacity in the New York-London market, hardly 70-80%.

For Boston-London, AA+BA would have 79.6% of the capacity in the market.

For comparison, in respective hub-to-hub markets, Star holds:

86.3% of the Chicago-Frankfurt market
100% of the Chicago-Zurich market
100% of the Washington-Frankfurt market
100% of the Washington-Zurich market

And for SkyTeam, some examples:

100% of the Detroit-Amsterdam market
100% of the Detroit-Paris market
100% of the New York-Amsterdam market
81.9% of the New York-Paris market
100% of the Atlanta-Amsterdam market
100% of the Atlanta-Paris market


User currently offlineViscount724 From Switzerland, joined Oct 2006, 24080 posts, RR: 22
Reply 8, posted (5 years 9 months 1 day 10 hours ago) and read 2094 times:



Quoting Avek00 (Reply 2):
Quoting ERJ170 (Thread starter):
No mention of US anywhere.. hmm

US is mentioned within the actual DOT filings. There are NO plans for US, Asiana, Air New Zealand, or COPA to join the immunized agreement.

Are you saying that the entire application only involves Transatlantic routes? The press releases imply that there are two parts to the application. I understood the first part was to add CO to the immunized agreements that UA currently has, which I believe now includes 9 other carriers: LH/LX/LO/TP/OS/SK/AC/OZ/NZ. If OZ and NZ aren't involved, what carrier am I missing since they mentioned 8 Star members in addition to UA?

The only reference to Transatlantic in the press releas involves the second part of the appllication to establish a joint venture involving UA/LH/CO/AC.

Do you have a link to the application? I was looking for it but couldn't find it.


User currently offlineCommavia From United States of America, joined Apr 2005, 11121 posts, RR: 62
Reply 9, posted (5 years 9 months 1 day 10 hours ago) and read 2068 times:



Quoting Viscount724 (Reply 8):
Do you have a link to the application? I was looking for it but couldn't find it.

Here and here.


User currently onlineUnited1 From United States of America, joined Oct 2003, 5817 posts, RR: 9
Reply 10, posted (5 years 9 months 1 day 9 hours ago) and read 2016 times:



Quoting Viscount724 (Reply 8):
Are you saying that the entire application only involves Transatlantic routes?

Step one for UA/CO is to establish a joint venture agreement with LH & AC across the Atlantic. The next step is a joint venture between UA/CO in Latin America and finally UA/CO will establish a JV across the Pacific. There are probably going to be other parties involved in the agreement across the Pacific but its all rumors at this point. At some point UA/CO will also begin codesharing on domestic flights as well as co-locating operations at airports across the system.

Quoting Viscount724 (Reply 8):
what carrier am I missing since they mentioned 8 Star members in addition to UA?

BD



Semper Fi - PowerPoint makes us stupid.
User currently offlineKiwiandrew From New Zealand, joined Jun 2005, 8492 posts, RR: 14
Reply 11, posted (5 years 9 months 1 day 6 hours ago) and read 1877 times:
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I thought this story was interesting - if only for the hint contained in the final sentence


http://www.atwonline.com/news/other.html?issueDate=7%2F24%2F2008



Continental Airlines and nine Star Alliance carriers asked the US Dept. of Transportation to allow CO to join the group already holding antitrust immunity. .......Star said, adding that CO expects to join the alliance in the fourth quarter of next year.

the first time I have seen anyone brave enough to even hint at a time frame for CO to join Star - I guess this assumes that NW/DL will sail through all approvals before the end of 2008 thus allowing a quick transition to Star at the end of the much talked about ' 9 month contractual obligation'



Moderation in all things ... including moderation ;-)
User currently offlineDeltaL1011man From United States of America, joined Sep 2005, 9081 posts, RR: 12
Reply 12, posted (5 years 9 months 1 day 6 hours ago) and read 1860 times:



Quoting Commavia (Reply 7):
And for SkyTeam, some examples:

100% of the Detroit-Amsterdam market
100% of the Detroit-Paris market
100% of the New York-Amsterdam market
81.9% of the New York-Paris market
100% of the Atlanta-Amsterdam market
100% of the Atlanta-Paris market

MSP-AMS,ATL-FCO,ATL-PRG,JFK-PRG,ATL-SVO........if you want me to I can go on for a while.



yep.
User currently offlineMutu From United Kingdom, joined Mar 2006, 530 posts, RR: 0
Reply 13, posted (5 years 9 months 18 hours ago) and read 1574 times:



Quoting JoFMO (Reply 6):
I don't think any of theses markets really should be matter of concern. Even where some airlines hold 100%, these markets are generally very small.

The only market the DOT has to address is LHR-NYC (and maybe LHR-BOS). These are huge markets and a combined AA+BA will dominate them by large. It would be nice if Commavia could provide us with numbers for these markets. I would assume that AA+BA have around 70-80% of the LHR-NYC market. This number concerns me more than the 100% LHR-DFW.
I could see that the DOT requires BA+AA to give up some slots of the NYC market or exclude this specific route from ATI.

well would that that was true. Unfortunately the legal framework governing TATL flights has moved from a UK/US bilateral (where BA/AA does indeed have a strong position) to a EU/US bilateral.

It cannot be argued that treaties are now continent-wide but then carve out an exception for the UK. So LH and AFKL can run virtual monopolies in their TATL routes but a UK airline has to give up more of its home base slots- to compete on a level playing field? I am afraid when the UK had its right to negotiate removed the only statistic that matters now is EU/US traffic.

Also worth note, LHR ranks amongst the worst airports in the world according to many posts here, any a majority of posters claim to avoid connecting through LHR, so it clearly is becoming far less important than AMS, CDG, MAdDand FRA
Personally all of these revenue and profit pooling arrangements are anti competitive but thats the way of the world


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