Delta Airlines Halt By The US Department Of Justice
U.S. Department of Justice filed a case in order stop transactions between Delta Airlines And United Continental Holdings.
USA based travelling service company, Delta Airlines, was sued on Tuesday by the Justice Department of America in order to stop its transaction between the two airline companies, Delta and United Continental Holdings, which was occupying 24 landing and take-off slots.
This problem occurred at the Newark Liberty International Airport, New Jersey, and it is aiming to preserve any kind of rivalries and competition at the airport. The occupied slot were being controlled by Delta Airlines since October, while it took United’s slots at John F. Kennedy Airport situated in New York.
The lawsuit revealed that United was using 24 landing and takeoff slots at the Newark airport, which contributed to the increment of the company’s dominant presence and made the barrier stronger. This destroys the chance of other airlines to compete with the U.S. airline resulting in 35 million passengers facing problems with the prices of the tickets that would cost more, while leaving them with fewer choices of airlines.
While this was happening at the Newark airport, United gave off John F. Kennedy airport to the other largest US travelling company, Delta, according to Yahoo News. This was a fair exchange between the two giant USA airline but it was unfair to other airlines in the market because these two companies were eradicating competition from the airports they exchanged by not giving a chance to others in the business.
The attorney of the justice department, General Bill Baer, made a statement regarding this case that said slots are a license that allow competition at Newark but since United is holding all the slots, the competition is badly affected. He also mentioned that the cost of travelling has become very high due to this, as Newark prices are already very high, and how its service at Newark is not up to the standards and the prices.
The complaint filed by department of justice mentioned how United hold 72% of the slots and no other traveling company has even 70 slots. These two air traveling companies are causing problems for passengers and airline in the business. Hence, they had to be stopped by the law.
They are also being investigated for participating illegally to keep airfares as high as they could for profit through limiting flights. Delta began flights at the JFK airport on November 1 through the deal with the American travel company and has not stopped its operation at the airport due to the lawsuit.
Delta stock closed at $49.97 on November 11.
