DOJ Opposes Aloha-Hawaiian Deal

Department of Justice urges DOT to reject antitrust immunity application

The Department of Justice is opposing the Aloha-Hawaiian request for temporary antitrust immunity to coordinate a new joint schedule on interisland routes. Aloha and Hawaiian asked the DOT for immunity through Oct. 1, 2003, to coordinate and reduce capacity on the routes (TravelAge West, Sept. 2).

The DOJ, however, urged the DOT to reject the application because the coordinated capacity reduction “will result in serious harm to consumers through higher fares and poorer service in some of the most heavily traveled city pairs in the U.S.”

The DOJ also concluded that there has been “no showing that such collusion on capacity is necessary to preserve air service in the interisland markets.”

The DOJ acknowledged that interisland traffic has declined during the past several years, and took another hit from the post-Sept. 11 decline in air travel. But the DOJ said the law on which the airlines are relying to receive antitrust immunity was meant only to protect against the “complete loss” of service, and “the available evidence shows that neither [carrier] is in imminent danger of failing” or pulling out of the interisland routes.