Airline Merger Could Help Southwest Expand in D.C.
DALLAS — The CEO of Southwest Airlines Co. assumes that American and US Airways will eventually merge, and he wants some of their takeoff and landing rights at Reagan National Airport outside Washington.
Southwest might have to fight JetBlue for those rights.
The U.S. Justice Department is suing to block the merger, saying that it would restrict competition and drive up consumer prices. It says US Airways and American would control 69 percent of the flights at Reagan National, which is just a Metro ride from downtown Washington, the Capitol, and the region’s suburbs.
A trial on the government’s lawsuit is scheduled for Nov. 25, but the airlines aren’t ruling out a negotiated settlement.
On Thursday, analysts asked CEO Gary Kelly whether Southwest would be interested if American and US Airways are forced to give up Reagan takeoff and landing rights, called slots.
“Absolutely,” Kelly said, “and I wouldn’t restrict it just to Reagan. We would be interested in more slots at LaGuardia (in New York) as well.”
Kelly added, “I can’t imagine that the merger goes forward without requiring divestiture … obviously the Justice Department seems to agree.” The CEO said he had no inside information about the situation but based his comments on antitrust law, the government’s lawsuit and the number of “slots that are hoarded — at Reagan in particular.”
US Airways declined to comment; American didn’t immediately respond.
Testifying before Congress this summer, US Airways Group Inc. CEO Doug Parker was adamant that the two airlines shouldn’t have to give up any slots. Tom Horton, the CEO of American parent AMR Corp., said recently that the companies are open to a reasonable settlement that lets the merger take place, but he declined to discuss specifics such as slots.
Last month, JetBlue Airways Corp. CEO Dave Barger said the merged airline should give up all of American’s flights at Reagan while keeping US Airways’ current slots.
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