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ATW Editor's Blog

Delta whines about JetBlue federal travel route rights

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Delta’s got the blues again about competition, and this time the Atlanta mega carrier is whining about US carrier JetBlue Airways.

In Delta’s sight line is an award by the US General Service Administration (GSA) - which manages government operations, including travel for federal employees - to New York low cost carrier JetBlue.

Delta has complained about that award in a letter to GSA, and the airline’s chief legal officer, Peter Carter, has posted the details of the letter on Delta’s website.

Why the concern? Because GSA has awarded JetBlue a contract that permits it to provide federal travel between New York JFK and Milan, Italy, and also between JFK and Dubai. JetBlue, which operates a fleet of Airbus A320s and Embraer 190s, does not fly either route with its equipment, so they will be operated as a codeshare on JetBlue’s partner, Dubai-based Emirates.

Cue indignant outrage from Delta, because, according to Carter, Emirates “will benefit via codeshare agreement from US taxpayer dollars – not a US flag air carrier as required by the Fly America Act”.

But wait, that’s not exactly the truth. US carriers do use codeshares with foreign airlines to fulfill their GSA contracts. And Carter himself writes, “Delta does not believe US carriers should never engage foreign codeshare partners to assist in the operation of international contract routes for US government-funded travel.”

For good reason. Otherwise, Delta itself would be “in violation” of the Fly America Act because it offers GSA routes that are operated by codeshare partners that include Air France, KLM, Aeromexico and Korean Air.

So it’s one rule for Delta, another for JetBlue?

GSA points out that codeshares are permitted if submitted as part of the bid, that JetBlue’s bid complied with the Fly America Act, and the fares it offered were cheaper than those of competitive bids. Price is part of the equation in GSA’s determining who gets which awards. JetBlue said in a statement that “GSA awards contracts that deliver the best value to the US taxpayer and JetBlue is honored to have this traffic with our codeshare partner.”

It’s been pretty quiet for the most part this year on the anti-Gulf carrier campaign that American, Delta and United waged ferociously last year.  My understanding is that the US carriers were effectively told the formal government-to-government talks on Open Skies compliance they requested are not going to happen, at least not in an election year, and who knows where this issue will sit in 2017’s political priorities? Not so high, is my guess. Especially when the end game by the US majors still seems to be to stomp out competition, especially in the prized transatlantic market (see also Norwegian Air International).

Karen Walker karen.walker@penton.com

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