DOT keeps slot swap conditions that Delta and US Airways said could kill the deal
By APTuesday, May 4, 2010
DOT keeps conditions on US Airways-Delta slot swap
MINNEAPOLIS — The Transportation Department said on Tuesday it will stick with conditions it proposed for a major swap of takeoff and landing rights between Delta Air Lines and US Airways. The airlines have said the terms might kill the deal.
US Airways wanted to trade 125 pairs of daily slots at LaGuardia airport in New York to Delta, for 42 slot pairs at Reagan National Airport in Washington.
A slot is the right to take off or land at an airport.
The Transportation Department on Tuesday said it would approve a deal if the carriers sell 14 slot pairs at Reagan and 20 at LaGuardia to airlines that have little or no service at those airports.
The DOT rejected a compromise proposed by the airlines in which they would transfer a smaller number of slots to carriers they chose.
The DOT said the counteroffer “would be insufficient to preserve competition at the two airports.”
The DOT conditions are similar to those it announced on Feb. 9. The airlines said then that those conditions would negate the financial benefits of the deal.
Jim Olson, a spokesman for US Airways Group Inc., said on Tuesday that the airline was disappointed by the ruling and would review it in more detail.
Shares of Delta Air Lines Inc., based in Atlanta, fell 87 cents, or 6.9 percent, to $11.72 in afternoon trading, while Tempe, Ariz.-based US Airways was down 56 cents, or 7.6 percent, at $6.83.
