Putting the kibosh on Delta’s aspirations to solidify its operations at Dallas Love Field airport, the Department of Justice this week ruled that Delta is not a suitable candidate to take over the two Love Field gates American must give up as part of its settlement to merge with US Airways.
In its “Response of Plaintiff United States to Public Comments on the Proposed Final Judgment,” the DOJ commented as follows on Delta’s bid to acquire the two Love Field gates:
In response to Delta’s request to acquire assets, the United States considered all the facts and circumstances in determining whether Delta should be considered an appropriate divestiture candidate. The United States concluded that divesting assets to Delta would fail to address the harm arising from the merger and would be inconsistent with the goals that the remedy seeks to achieve.
The “goal” referred to by the DOJ is to maintain competition, and the “remedy” is transferring selected American gates, including those at Love Field, to low-cost carriers (LCCs).
Delta had argued that divesting American’s Love Field gates “to a LCC would harm Dallas-area passengers by depriving them of Delta’s network service.” That was part of Delta’s overall contention that only a full-service airline could provide the breadth of services and amenities required by business flyers.
But in a stinging response to Delta’s claim that LCCs do not serve business travelers, the DOJ pointed out that “Virgin America also caters to business passengers, billing its flights to corporate travel customers as ‘your corner office in the sky.’ Virgin America was the first domestic airline to offer fleetwide WiFi, and its premium class service has been named the best among domestic airlines in an annual poll of business travelers for several years in a row (Delta was fifth in the most recent poll).”
And, not coincidentally, it is Virgin America that is competing against Delta for the disputed Love Field gates, together with Southwest. But Southwest already controls 80 percent of Love Field’s gates, so it seems unlikely that the DOJ would support further consolidation of market power in a single carrier’s hands.
So, unless another LCC expresses interest, it appears that Virgin America will be launching new flights to LaGuardia, Washington National, and Chicago O’Hare from Love Field, as well as relocating its current Los Angeles and San Francisco flights from Dallas-Ft. Worth to Love Field.
This article originally appeared on FrequentFlier.com.
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