Delta, Northwest, Continental joining forces

Published: Wednesday, January 22, 2003 at 6:01 a.m.
Last Modified: Tuesday, January 21, 2003 at 10:48 p.m.
WASHINGTON - Delta, Northwest and Continental airlines said Tuesday they will go ahead with a marketing alliance and ignore government restrictions aimed at preventing them from dominating air travel in certain markets.
The "code-sharing agreement" among the third-, fourth- and fifth-largest airlines would enable each to sell tickets for all three airlines, allowing them to reach more destinations without flying more planes. They also could offer reciprocal benefits such as frequent flier miles.
The Justice and Transportation departments approved the plan Friday, but did so with certain stringent requirements. The airlines reviewed the government's plan during the weekend and issued a statement Tuesday.
"Some conditions are unacceptable, and we will not agree to them," they said in a statement.
Bill Mosley, Transportation Department spokesman, said transportation officials don't have an immediate comment.
Darryl Jenkins, head of George Washington University's Aviation Institute, predicted the dispute will end up in court because transportation officials and the airlines are both entrenched in their positions.
"They're both trying to stretch and see what they can get away with," Jenkins said. "The Department of Transportation has never come out with anything this far reaching."
In the meantime, Jenkins said, transportation officials can punish the three airlines by denying their requests for overseas routes.
The airlines said the Transportation Department held them to a different standard than United Air Lines and US Airways, which were allowed to go ahead with a similar agreement in October. The carriers objected to three conditions: that they give up leases on airport gates used fewer than six times a day over two months, that they limit the total number of flights that share codes to 2,600 and that they refrain from making joint bids on corporate or travel agency contracts.
The airlines said they'll fight any efforts by the Transportation Department to enforce the restrictions.
Both the Transportation and Justice departments reviewed the agreement. The airlines said the Justice Department, which didn't impose the objectionable restrictions, is "the government agency with the principal responsibility and expertise in enforcement of U.S. competition laws."

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