WASHINGTON, D.C. – In early December, Alaska Airlines announced they are buying Hawaiian Airlines. While the companies promise the merger will unlock more destinations for consumers and expand choice for air travel in the US and the Pacific, Guam’s congressional delegate worries the merger could potentially be harmful for consumers.
“We need to be cautious,” said Guam Delegate Jim Moylan (R- GUAM).
Moylan has some reservations about the purchase of Hawaiian Airlines by Alaska Airlines.
“We’re not saying we’re against the merger we’re just saying there’s some big concerns for people that are reliant on the air transportation to see family on the mainland for their jobs to come back home or to vacation,” said Moylan.
The roughly two-billion-dollar deal was announced earlier this month. The combined company would maintain both airlines’ brands, an unusual move for the industry.
“We’ve also seen this before with Alaskan Airlines purchase of Virgin Airlines where it was promised it would keep on but within three years after Virgin air is gone,” said Moylan. “If that happens and the promise is not there, I believe there will be an increase in prices and we won’t have much of a choice to do anything about it.”
Moylan sent a letter to the FTC Chair about the merger:
He asked the FTC and the DOJ to exercise their oversight capability to ensure this merger is not an illegal concentration of market power. Moylan worries routes to places in the Pacific, like American Samoa, could be sold off or folded in favor of more profitable routes to and from the mainland.
“That’s why we’re asking the Department of Transportation through the Department of Justice to really look at this to really have an oversight on this,” said Moylan. “And if it’s not carried out the way they said for the protection of consumers, protection for the INDOPACOM area, for Guam, America Samoa, those folks that are familiar with, lets just protect the people.”
In a press release, Alaska Airlines stated in part passengers traveling throughout the continental US, the west coast and across the Pacific will benefit from more choice and increased connectivity across both airlines’ networks. But before this is a done deal, US regulators have to give its final approval. The DOT sent us this statement:
“Robust airline competition makes it more affordable to fly, and promoting that competition is a key priority and mandate for the U.S. Department of Transportation. Airlines seeking to merge require DOT to approve their transfer application to combine and operate under one certificate in order to fly. The Department is responsible for determining whether granting such an application is in the public interest and can investigate whether a deal would constitute an unfair method of competition or an unfair or deceptive practice. At this time, we have no comment on specifics of the potential merger.”
Department of Transportation
