DOT final order gives ATI to Delta, Virgin Australia alliance

Washington DC
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The US Department of Transportation (DOT) today issued a final order that gives antitrust immunity to Delta Air Lines and Virgin Australia to form their proposed trans-Pacific alliance.

The announcement comes after tentative approval was given last month.

The DOT said in its final order that it is "adopting the findings and conclusions" of last month's tentative approval "without modification".

Delta CEO Richard Anderson said that the "final ruling by the DOT will expand competition and enhance customer service and travel options for passengers flying between the US and Australia".

"Now that we have DOT approval, we will move quickly to implement the joint venture and plan to have it up and running by the end of the year", said Virgin Australia CEO John Borghetti.

According to the DOT order, the two firms have 18 months to launch the alliance, or the "authority granted will expire and the grant of antitrust immunity will no longer be effective."

Delta and Virgin had originally applied for antitrust immunity in July 2009, but the DOT tentatively denied the application in September 2010 "primarily because the applicants failed to show that the proposed alliance would deliver sufficient public benefits to justify a grant of antitrust immunity", according to today's final order.

The DOT said in its order today that Delta and Virgin "had sufficiently addressed the department's concerns outlined" in its September 2010 tentative disapproval and had also "provided all necessary follow-up documentation requested" in a November 2010 DOT order.

Delta and Virgin also began a codesharing pact in January last year, which was expanded last month to include "add five new destinations in Australia and New Zealand to Delta's network", said Delta.