United and Delta have been blocked from trading take-off and landing slots at two east coast airports.
The Justice Department has stepped in because it clams the deal would increase United’s dominant position at New York’s Newark Liberty Airport.
It says this will make it harder for other airlines to compete.
“Competition in Newark is in critically short supply,” William J. Baer, the assistant attorney general, said in a statement.
“Allowing United to acquire even more slots at Newark would fortify United’s monopoly position and weaken rivals’ ability to challenge that dominance, leaving consumers to pay the price.”
United already controls more than 70% of the traffic in Newark following its merger with Continental.
Airfares from Newark are among the highest in the US, according to the Justice Department, as a result of what it called a ‘Newark premium’.
United has signaled its intention to move out of JFK airport, where it hasn’t made a profit for the past seven years, and focus instead on Newark. As a result, it planned to lease 22 slots from Delta at Newark in exchange for 24 slots at Kennedy.
United argues the agreement would be good for passengers and says it will ‘vigorously defend’ its case
