Feds Ground the JetBlue-Spirit Merger
Today’s edition of Skift’s daily podcast looks at JetBlue-Spirt challenges, Airbnb’s advantages, and Air France’s air and rail opportunities.
Good morning from Skift. It’s Wednesday, March 8. Here’s what you need to know about the business of travel today.
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The U.S. Department of Justice announced on Tuesday it filed a lawsuit to block the proposed merger between JetBlue Airways and Spirit Airlines, a major blow to their attempt to create the fifth largest airline in the U.S. The department cited concerns the deal would decrease competition, reports Edward Russell, Editor of Airline Weekly, a Skift brand.
U.S. Attorney General Merrick Garland said a JetBlue-Spirit merger would result in higher fares and fewer options for consumers. The Justice Department had argued the deal would raise airfares especially in Florida, an important market for both JetBlue and Spirit. The U.S. Department of Transportation expressed support for the Justice Department’s position.
Meanwhile, JetBlue CEO Robin Hayes came out against the Justice Department’s decision, arguing a merger with Spirit would create a national low-fare competitor to the largest four U.S. airlines. Hayes had previously said JetBlue would take the Justice Department to court if it blocked the merger.
Next, Airbnb is looking at more ways to strengthen its competitive advantages over its rivals. Part of its strategy includes launching new services for guests, reports Executive Editor Dennis Schaal.
CEO Brian Chesky said at an investor conference on Tuesday that he wants Airbnb to deepen the moat between the short-term rental giant and its rivals. So he stated Airbnb is considering providing more free services for hosts, adding the company needs to give away more value than it’s charging. Chesky said Airbnb already offers hosts benefits it rivals don’t, including $3 million in damage protection via its AirCover insurance. He also acknowledged that Airbnb would reach a point where it starts charging for additional services.
Chesky also mentioned that Airbnb is looking to launch an advertising platform that includes sponsored listings.
Finally, Air France CEO Anne Rigail is adamant that air-rail connections, which enable passengers to book flights and train journeys on one trip, will be a bigger part of its strategy. And the company believes improving travelers’ transfer experiences will help it sell more joint air-rail tickets, reports Russell, editor of Airline Weekly, a Skift brand.
Rigail said in an interview she wants to expand the number of routes in Air France’s Air Plus Train program, including to destinations not currently served by plane. The company also started allowing travelers to check in for both portions of their journey on the Air France app. Rigail expressed confidence Air France would increase air-rail bookings, having acknowledged that its connections in the past often left a lot to be desired.
Russell adds expanding air-rail connectivity is a key part of the company’s goal to significantly reduce its carbon emissions.
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