Alaska Air Group said yesterday that it will delay its merger with Virgin America, originally scheduled for September 30th, in order to allow the US DOJ additional time to review the deal. Alaska met last week with the antitrust division chief to discuss competitive concerns, though the airlines contend that their routes are mostly complementary. The Chicago Tribune reports that the decision could set the future tone for US airline consolidation:
This is the first substantial airline merger since the Justice Department sued to block US Airways Group’s takeover of American Airlines in 2013, a case that ultimately settled after the carriers agreed to sell airport assets to low-fare competitors. The government’s decision on this tie-up will be closely watched for its view on the current state of competition in the airline industry.
In other news, the San Francisco Business Times reports that Alaska plans to cut about 225 Virgin America management jobs beginning in October.
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