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DOT Rejects Blanket Dormancy Waiver

July 7th, 2008 @ 7:44 am

1 Comment

Tags: Penalty, Government, Vertical Industries, Enterprise Software, Software, Brett Snyder

Looks like I was completely wrong. I figured that when seven airlines filed for the right to suspend international flights without penalty for a two year period, the DOT would just go ahead and approve it. Silly me. They denied the request last Thursday.

It was a short and sweet rejection of the application. To sum things up:

While we recognize the concerns cited by the carriers, we also recognize that the market characteristics of each limited entry route are different and that the impact of market forces on individual carriers is different.

Every market has different dynamics, and the government wants to review each dormancy request individually, as they do now. This will allow them to make case-by-case exemptions when necessary. Spirit is likely to be happy about this decision, since they’ve got their eyes on more Latin American flying. It’ll be interesting to see if American is willing to walk away from some of those frequencies knowing they may end up in Spirit’s lap.

But don’t think that this means the DOT will be rejecting everything that comes through. They’ve already apparently authorized Northwest and US Airways to delay their China services without penalty. We’ll just have to see how things are dealt with on a case by case basis.

In addition to writing BNET's travel industry blog, Brett Snyder also pens the award-winning consumer travel blog, Cranky Flier.

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    davidthomson_9807/08/08 Report as spam
    1

    Info is Incomplete

    Bret, you are normally a little more complete with your info. This is a little dated (but you do say so yourself) and what you havent explained is the why the DOT agreed to allow the China routes to wait. Their ruling was that this was OK as long as no other carrier was interested. Nobody else was. Expect the same treatment on a case by case basis in Latin America with American/Spirit and elsewhere. Cheers.

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Brett Snyder

Brett has worked in various pricing, sales, and marketing functions for airlines including America West and United. In addition to writing for BNET's Travel industry blog, he also writes the award-winning consumer travel blog, The Cranky Flier, and holds an MBA from Stanford. more »

AboutTravel Industry

BNET Travel provides daily industry news coverage and insights for managers and executives about all aspects of the travel and tourism industry. In addition to detailed company profiles, we bring you critical analysis on new alliances and partnerships, new products and carrier routes, mergers and acquisitions, labor and cost management, investments and deal flow, and a host of other important business issues.

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