Despite being slammed by American for allegedly trying to derail the talks, Delta Air Lines also has publicly expressed support for the new agreement. “Delta thanks negotiators from the United States and Japan for their efforts to develop an open skies agreement that will oversee aviation between the two nations. Delta Air Lines has long supported open skies in international markets, citing the well-established benefits for consumers, airline employees and investors,” Delta says in a statement.
“This agreement opens the door to antitrust immunity, which would enable Delta and Japan Air Lines to engage in deeper and more effective cooperation, producing greater benefits for the carriers and their customers,” the Delta statement continues. “Delta is confident that the Department of Transportation would grant it antitrust immunity with JAL, and Delta will continue to support open skies agreements between the United States and its trading partners.”
In a statement issued by United Airlines, Glenn Tilton, UAL president, chairman and CEO, is quoted as saying: “We congratulate the U.S. and Japanese delegates for reaching this historic agreement as we have long advocated for Open Skies with Japan because it will benefit our customers, our employees and our investors as we strengthen our Pacific network. We have the right partners and look forward to forming a joint venture across the Pacific with our longtime partner All Nippon Airways and Continental, which joined the Star Alliance in October, providing our customers with access to more destinations and convenient schedules.”
United says it expects to file an application with the Department of Transportation for anti-trust immunity across the Pacific with Continental and ANA shortly. Earlier this year, the Department of Transportation awarded anti-trust immunity to United, Continental, Lufthansa and Air Canada for the Atlantic-Plus-Plus joint venture across the Atlantic, which allows the airlines jointly to set their schedules, fares and seat and cargo capacity in the transatlantic markets they serve.
“An immunized alliance would substantially expand the global reach of the carriers’ networks, providing customers access to larger inventories of seats and cargo capacity, serving more destinations, offering a greater selection of routings, and providing consumers a wider range of competitive fare and service options,” says United.
Various industry observers have posited that Delta Air Lines’ recent action in approaching Japan Airlines with a proposal ― accompanied by a $1.1 billion financial inducement ― to abandon its existing relationship with American Airlines and the oneworld alliance and join the Delta- and Air France KLM Group-led SkyTeam alliance instead was prompted by fears of how an Open Skies agreement between the U.S. and Japan would help United and ANA, and JAL and American, combine more effectively on transpacific routes.
Both ANA and United operate extensively at Tokyo Narita Airport under the terms of the 1952 bilateral agreement, United acquiring the rights to serve Narita through its purchase of transpacific route rights from the former Pan American Airways. For many years, Northwest Airlines (now part of Delta) has operated an Asian regional hub at Narita under permission granted by the 1952 agreement, and Northwest has traditionally had the biggest presence of any U.S. airline on routes between the United States and Japan. However, to date Delta/Northwest has never had an alliance relationship with any of the two major Japanese carriers.
American responded to Delta’s overture to JAL with financial inducements of its own, rapidly raising the stakes in what quickly became a bidding war. However, the Japanese government has indicated it would prefer for JAL to remain financially independent and the announcement of an Open Skies agreement between Japan and the U.S. was immediately reflected in a strengthening of troubled JAL’s share price on Tokyo’s Nissei stock exchange. ANA’s share price also rose upon the annoucnement of the Open Skies deal.
Related to this story:
- JAL and American to Share Japan Airlines’ Sakura Lounge at Honolulu
- Japan Airlines to Launch Tokyo-Boston Service in 2012, with Boeing 787s
- New Open Skies Deal to Liberalize Flights between the U.S. and Brazil
- Japan Airlines to Codeshare on 13 More Cathay Pacific Routes
- U.S. and EU Agree Landmark Second Stage of Open Skies Deal
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