In February 2024, the U.S. Department of Justice (DOJ) commenced an extensive review of the proposed merger between Alaska Airlines and Hawaiian Airlines. Following a detailed compliance check, the DOJ now has a deadline of August 5, 2024, to finalize its decision.
- The DOJ has until August 5, 2024, to decide on the Alaska-Hawaiian merger.
- Hawaiian Airlines and Alaska Airlines certified substantial compliance triggering a 90-day waiting period.
- The merger plans include Hawaiian Airlines joining Alaska Air Group and expanding the flight options offered.
In an update provided by the airlines, they confirmed their full compliance with the DOJ’s rigorous second request for additional information. This submission sets in motion a 90-day review period that could see the merger getting the green light before the deadline if the DOJ concludes its review early.
Background of the Merger
Announced in late December 2023, the proposed merger involves Alaska Air Group acquiring Hawaiian Airlines. The merger aims to create a robust fleet under the Alaska Air Group umbrella, which includes Alaska Airlines, Horizon Air, and Hawaiian Airlines. This expansion is expected to enhance the group’s capacity by offering an additional 2 million premium seats and expanding its first-class and business class offerings.
The strategic move would also integrate Hawaiian Airlines into the oneworld alliance, broadening its global network and aligning it with Alaska Airlines’ existing membership.
Current Status and Future Prospects
As of May 2024, the merger has received approval from shareholders. However, it remains under DOJ scrutiny, with both airlines engaged in a timing agreement to supply all necessary data promptly. This careful examination by the DOJ ensures that the merger aligns with industry regulations and does not stifle competition.
This merger comes on the heels of the DOJ blocking the Spirit Airlines and JetBlue merger earlier in the year due to concerns over potential anti-competitive effects that could harm consumers by driving up prices and reducing travel options.
As the airlines await the DOJ’s decision, the industry and travelers alike are keenly observing how this merger could reshape the aviation landscape, impacting everything from airline operations to passenger experiences and loyalty program benefits.
Conclusion
The proposed merger between Alaska Airlines and Hawaiian Airlines marks a significant development in the aviation industry, with potential to reshape the market landscape by expanding service offerings and enhancing passenger experiences. However, the outcome hinges on the U.S. Department of Justice’s review, which will assess the merger’s compliance with antitrust laws to ensure that it does not adversely affect competition and consumer choice. As the August 5 deadline approaches, all eyes will be on the DOJ to see if this merger can successfully navigate the regulatory hurdles that have challenged other airline mergers in the past.
FaQs
What is the deadline for the DOJ to make a decision on the Alaska-Hawaiian merger?
The DOJ has until August 5, 2024, to finalize its decision on the proposed merger between Alaska Airlines and Hawaiian Airlines.
What are the main benefits of the Alaska-Hawaiian Airlines merger?
The merger will result in a combined fleet of 385 aircraft across three airlines, increasing flight options and providing an additional 2 million premium seats. It will also integrate Hawaiian Airlines into the oneworld alliance, enhancing global connectivity for passengers.
Why is the DOJ reviewing the Alaska-Hawaiian Airlines merger?
The DOJ is reviewing the merger to ensure it does not create anti-competitive effects in the airline industry, such as increased ticket prices or reduced flight options, which could negatively impact consumers.
What happens if the DOJ approves the merger before the deadline
If the DOJ concludes its investigation positively and approves the merger before the August 5 deadline, the merger agreement between Alaska Airlines and Hawaiian Airlines can be finalized and implemented sooner.
Has there been a similar case where the DOJ halted a merger between airlines?
Yes, earlier in 2024, the DOJ halted the merger between Spirit Airlines and JetBlue, citing concerns that it would lead to reduced competition, higher prices, and fewer choices for consumers, highlighting the stringent scrutiny mergers in the airline industry face.
