I sometimes wonder if I’m mildly prophetic! Only a couple of weeks ago I critiqued why the joint venture regime so easily permitted by European and US administrations, was so pernicious and damaging to competition.
JetBlue has for some time been known as a potential entrant to the market. It’s struggling to do that because US mega airlines Delta, United and American have such a stranglehold on airport access.
One example given was that out of 193 gates at Atlanta – Delta had direct control of 173, and JetBlue was effectively barred from leasing even one. Similar situations crop up with United at Newark and American at JFK.
But beyond even trying to find a space at an airport, the airlines most senior manager laid into, and quite rightly, the whole system. The way it allows legalised monopolistic practice over busy routes, price collusion that would be illegal in any other walk of life or business, and the stifling of any real opposing business.
Much of his speech was devoted to the USB3 and their war with the ME3 – and how that was more about defending their monopolies in the US and in their joint venture markets, than it was about unfair practice.
An example was how suddenly, Delta with its possible take over of Alitalia now on the cards – it was once the secret fourth party possible buyer – their change of tune on unfair ownership and subsidies has suddenly evaporated.
Why? Because Delta’s offer was based on the Italian governments subsidy of Alitalia being forgotten, and not included in any purchase for repayment. If a Middle Eastern airline had done that Delta would be crying foul play and screaming for something to be done.