Feds will have say in airline alliance plan

Bloomberg News
Published6/17/2009 5:05 PM

The U.S. Justice Department will have a say in Continental Airlines Inc.'s plan to coordinate flights abroad with the members of the Star Alliance, which includes UAL Corp.’s United Airlines and Deutsche Lufthansa AG.

“We did ask the Transportation Department to allow our antitrust division to have input into the decision,” Attorney General Eric Holder said at a Senate Judiciary Committee hearing today in Washington.


Transportation Secretary Ray LaHood "agreed to allow us to participate," he added. Holder said he didn’t believe Justice’s role would extend the case beyond a few weeks.

Continental, the fourth-largest U.S. carrier, will be able to jointly plan pricing, schedules and marketing with the Star Alliance carriers, the Transportation Department said in April. The agency hasn’t made the decision final.

LaHood, when asked about the alliance case in an interview today, declined to comment.

"The law doesn't allow me to talk about those things while they’re under consideration," LaHood said.

Houston-based Continental sought government approval in July 2008 to collaborate in Star, the largest airline alliance. Airlines use alliances to create more route options for customers and to boost revenue by attracting passengers from partner carriers.

The Transportation Department’s preliminary decision in April also would allow Continental, United, Lufthansa and Air Canada to create a joint venture for some international flights.

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