Alaska Air Group’s proposal to join the Oneworld transatlantic and transpacific joint ventures, which already include American Airlines, could change the way airline alliances are structured. This move would be the first time two US carriers are part of the same joint-venture alliance, and it presents distinctive considerations for antitrust regulators at the Department of Transportation.
Experts say that the proposal will likely receive a closer look from regulators due to the involvement of two domestic airlines. James Speta, a professor and antitrust specialist at Northwestern University’s Pritzker School of Law, notes that when joint ventures are awarded antitrust immunity, partner airlines can coordinate schedules, creating the possibility for American and Alaska to discuss domestic services.
Antitrust Considerations
The transatlantic joint venture includes American, British Airways, Iberia, Aer Lingus, Level, and Finnair, while the transpacific alliance consists of American and Japan Airlines. Alaska Air Group and American jointly announced on September 29 that Alaska would seek regulatory authority to join these antitrust-immune Oneworld joint ventures.
Alex Judson, Alaska Air Group’s director of partnerships and international, says that the intent is for antitrust immunity to apply to both of the company’s airlines: Alaska and Hawaiian. The joint venture would flow through Alaska’s emerging international hub in Seattle, from where Alaska flies to Europe and Asia, as well as through Honolulu, where Hawaiian Airlines operates flights to Japan.
Competing Effectively
Judson notes that international joint ventures are key to competing effectively, as more than 85% of US airlines’ long-haul capacity is operated as part of a joint venture. Alaska and American already codeshare on domestic and long-haul routes, but revenue sharing on joint-venture routes is far more substantial than the payout an airline gets for booking a codeshare customer on a partner carrier.
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Bob Mann, an airline consultant, says that this means Alaska and American will be more motivated to market each other’s services and alter schedules and capacity to coordinate the partnership. For example, American is scheduled to fly twice daily from New York JFK to Seattle next summer, competing with Alaska, and being part of a joint venture could alter how they approach this service.
Regulatory Path Forward
The closest equivalent to a joint venture shared by multiple US airlines came from 2021 to 2023, when American and JetBlue engaged in revenue sharing and joint scheduling in their Northeast Alliance out of New York and Boston. However, this arrangement was dissolved by court order after the Biden administration’s Justice Department challenged it as anticompetitive.
Mann notes that another US airline, potentially Delta, could object to Alaska joining the Oneworld joint ventures, and opposition could also come from American Airlines pilots. Conversely, the Trump administration’s relatively permissive approach on antitrust matters could ease the regulatory path forward.
Scott Wagner, an antitrust attorney, says that the DOT’s core considerations will be whether Alaska joining would reduce capacity on certain routes and whether it would lead to higher fares. Alaska’s position as a relative newcomer to global flying will likely reduce concerns about consolidation, but regulators may require conditions to prevent an enhanced American-Alaska partnership from weakening domestic competition.
Judson says that Alaska is prepared for such conditions and will wait to see what the DOT’s guardrails will be. The company needs the joint ventures to “compete and grow,” and regulators could require the airlines to maintain capacity on certain routes to ensure fair competition.