JetBlue Airways has announced the end of its partnership with American Airlines in the northeastern US after a federal judge ruled the carriers must terminate the agreement.
The partnership, known as the Northeast Alliance (NEA), allowed the two airlines to coordinate schedules, share passengers and revenue, and better compete against larger carriers in congested airports.Â
However, the US Department of Justice (DOJ) filed a lawsuit in 2021, joined by six states and the District of Columbia, alleging the alliance was anti-competitive.
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While American Airlines plans to appeal the ruling, JetBlue has decided not to pursue an appeal and instead focus on its proposed acquisition of Spirit Airlines.
In a statement, JetBlue said: “Despite our deep conviction in the procompetitive benefits of the NEA, after much consideration, JetBlue has made the difficult decision not to appeal the court’s determination that the NEA cannot continue as currently crafted.
The airline has initiated the process of terminating the agreement, which will be completed over the next few months.
JetBlue’s acquisition of Spirit Airlines, which emerged after the launch of the NEA, is seen as crucial for the airline’s growth and competition against larger carriers dominating domestic air travel.
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The deal, which JetBlue won in July 2022 following a bidding war with Frontier Airlines, would make the combined carrier the fifth-largest in the country.
It would provide JetBlue with increased access to aircraft and pilots, addressing the industry’s supply shortages in these areas.
The purchase of Spirit Airlines, however, faces significant regulatory hurdles, as the Biden administration has expressed concerns about deals that harm competition.
The DOJ filed a lawsuit in March to block the acquisition, saying it would eliminate unique competition provided by Spirit and result in higher fares and reduced options for travelers.
