The American-JetBlue Partnership Is Over

The much-ballyhooed, but heavily scrutinized, partnership between American Airlines and JetBlue Airways has come to an end. 

A federal judge ruled on Friday that the so-called "Northeast Alliance" between the two airlines is anti-competitive and should be dissolved within 30 days. 

That means the partnership, which had a virtual monopoly on northeast routes, must end by mid to late June. The Department of Justice had filed an antitrust suit against the alliance more than a year ago. 

"The NEA [Northeast Alliance], operating as it was designed and intended by American and JetBlue, substantially diminishes competition in the domestic market for air travel. It does so by combining the Boston and New York operations of two airlines that are among the most significant competitors in that region, " according to Friday's decision penned by Judge Leo T. Sorokin. 

Both airlines have significant operations in Boston and New York. In fact, New York is the home base for JetBlue. 

Since the DOJ is also suing to block JetBlue’s merger with Spirit Airlines, many now wonder if it bodes well for that partnership as well. 

"This was a bit of a surprise, as we believed with more than two years of data, the judge would rule in the airlines' favor, ” TD Cowen analyst Helane Becker wrote. 

There is a concern about airfare prices. By having the two airlines work against each other, the market is more competitive. Both American and JetBlue say they cannot compete against United or Delta in those markets. The three-week trial was held in Boston.

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