Pairs Acquired From Delta Airlines In DOT Mandated Auction
JetBlue Airways will gain additional slots at New York LaGuardia
Airport and Ronald Reagan Washington National Airport, and WestJet
Airlines will gain its first slots at LaGuardia.
In a news release, the U.S. DOT said the two carriers have
reached binding agreements with Delta Air Lines to acquire some of
its operating authority, or “slots,” at the two
airports. A “slot” refers to a carrier’s
authority to take off or land at an airport where flight operations
are limited by the Federal Aviation Administration (FAA). DOT and
the FAA required Delta and US Airways to divest a total of 48 slots
amongst the two airlines as a condition for being able to exchange
other slots they hold at the two airports. JetBlue and WestJet
submitted successful bids for those slots in an auction conducted
by the FAA. JetBlue currently operates a limited number of flights
at both airports, and WestJet has no service at LaGuardia.
“As a result of the conditions we placed on the transfer
between Delta and US Airways, consumers will benefit from new
competition and services at both airports from airlines that
previously had limited access, or no access at all, to those
airports,” U.S. Transportation Secretary Ray LaHood said.
JetBlue will pay $40 million for eight pairs of daily slots at
Reagan National and $32.0 million for eight slot pairs at
LaGuardia. WestJet, a Canadian carrier, will pay $17.6 million for
eight slot pairs at LaGuardia. A slot pair, or two slots, is
required for a takeoff and landing during times when these rights
are limited.
On Oct. 7, DOT approved a request by the carriers under which
Delta would trade 42 daily slot pairs at Reagan National for 132 of
US Airways’ daily slot pairs at LaGuardia. The Department
placed a number of conditions on the trade to promote competition
and protect consumers, including a requirement that the carriers
divest themselves of eight pairs of daily slots at Reagan National
and 16 pairs at LaGuardia by means of a blind auction administered
by the FAA.
The bidding took place between Nov. 14 and Nov. 22, with bids
submitted via e-mail. Only carriers having less than five percent
of the slots at LaGuardia or Reagan National, and not code-sharing
at the respective airport with a carrier that has five percent or
more of the slots, were eligible to bid for the divested slots at
that airport. In order to ensure that a purchaser would be able to
provide meaningful new competition, all eight slot pairs at Reagan
National were sold in a single bundle, and the 16 pairs at
LaGuardia were sold in two bundles of eight slot pairs each.
JetBlue submitted the highest bids for all three slot
A total of seven carriers participated in the bidding for the
slots. The others were Allegiant Airlines, Frontier Airlines, Sun
Country Airlines, Southwest Airlines and Spirit Airlines.