DOT puts consumers first in DCA/LGA slot swap deal

by Charlie Leocha on February 25, 2010

Back last August Delta Air Lines and US Airways proposed trading their slots at New York LaGuardia and Washington Reagan like baseball cards. Delta wanted more NY slots and US Airways wanted more DC gates. Both were already powerhouses at the airports where they wanted more slots.

Every story published in newspapers across the country pondered the effects on the respective airlines. Would this swap actually help the bottom line of Delta and US Air and allow them to box out competitors. ConsumerTraveler.com coverage focused on consumers and their loss of competition.

The Consumer Travel Alliance, at that time, wrote to to the Department of Transportation (DOT) urging them to focus on the consumers.

These slot machinations should also be examined in light of how airline alliances are using their ability to cobrand flights as a means to claim equal service while actually reducing flights. We need to keep in mind that the airlines have no antitrust immunity when it comes to domestic operations.

I urge you to keep passengers in mind as this decision moves forward. The media, to this point has only examined the benefits these swaps will bring to the airlines. Consumers have been forgotten. I trust that the FAA deliberations will include a close look at how these proposed changes impact the flying public.

The DOT evidently heard us. Their final proposed approval of the slot swaps between Delta and USAirways, required them to divest themselves of slots at each airport to guarantee acceptable competition at LaGuardia and Washington Reagan.

The deal would transfer 125 slots from US Airways to Delta at LaGuardia. Those are currently used by US Airways Express and regulators said 20 would have to be divested.

US Airways sought 42 slots in Washington from Delta. Regulators said 14 of those would have to go on the block.

The final response to the caveats to the proposed deal has not come yet from the airlines. Both Delta and USAirways have indicated that they may put off the swaps should they not get their way and keep all their resulting slots in New York and Washington, DC.

Part of the problem is that in the DOT rulemaking, the airlines would have to sell the slots to U.S. or Canadian carriers that have less than 5 percent of the total slot interest holdings at the two airports, do not code-share on flights to or from the airports with any airline that has 5 percent or more slot interest holdings there, and are not subsidiaries of a company whose combined slot interest holdings are equal to or greater than 5 percent at National or LaGuardia.

That legalese translates to an opening for more competition from Southwest Airlines. We all know how legacy carriers feel about that.

Chalk this one up for consumers. Thanks DOT for not letting the airline tail wag your consumer protection watchdog.

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