DALLAS (CBSDFW.COM) — The Justice Department announced on Tuesday a proposed settlement with U.S. Airways and American Airlines that will allow the merger to move forward.
As part of the agreement, the airlines will be required to divert slots and gates at airports across the country to low cost airlines. The Justice Department says the requirements will result in more choices and more competitive fares for consumers.
“This agreement has the potential to shift the landscape of the airline industry. By guaranteeing a bigger foothold for low-cost carriers at key U.S. airports, this settlement ensures airline passengers will see more competition on nonstop and connecting routes throughout the country,” said Attorney General Eric Holder. “The department’s ultimate goal has remained steadfast throughout this process – to ensure vigorous competition in airline travel. This is vital to millions of consumers who will benefit from both more competitive prices and enhanced travel options.”
The department says the proposed settlement will increase the presence of low-cost carriers at seven ‘key-constrained’ airports: Boston Logan International, Chicago O’Hare International, Dallas Love Field, Los Angeles International, Miami International, New York LaGuardia International and Ronald Reagan Washington National.
If approved, the settlement will resolve the department’s lawsuit filed against the merger. Six state attorneys general — Arizona, Florida, Pennsylvania, Michigan, Tennessee and Virginia — and the District of Columbia joined in the department’s proposed settlement.
Texas Attorney General Greg Abbott pulled out of the suit after reaching a settlement in early October. Part of the settlement included a signed agreement that will keep the new combined airline’s corporate headquarters in North Texas. The settlement also required the carrier to continue service to 22 airports in Texas for a three-year period.
Abbott was attacked by both parties for his about face on the lawsuit.
The announced agreement was cheered by the Association of Processional Flight Attendants, who represents 16,000 flight attendants at American Airlines.
“This is fantastic news not only for all the employees of the new American, but for consumers and the industry,” said APFA President Laura Glading. “I want to thank our flight attendants for stepping up and making the case for this merger. Clearly, our voices were heard at the Justice Department. There is strength in unity.”
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