American Airlines and JetBlue announced the next steps in the process of unwinding their Northeast Alliance (NEA) and how it will impact customers after a court judge ruled the alliance should be disbanded.
Beginning July 21, 2023, both airlines will no longer allow passengers to book codeshare flights on their respective itineraries. Those who have already booked flights will need to add either American Airlines (AAdvantage) or JetBlue (TrueBlue) loyalty program numbers to the booking to earn points, tiles, and reciprocal perks.
JetBlue said members of TrueBlue can still earn points for all tickets purchased prior to July 21, 2023, with the condition that passengers add a loyalty program number to the booking before that date.
“We are disappointed to be ending popular benefits like codesharing and reciprocal loyalty benefits. We know customers will miss these features and believe the U.S. Department of Justice’s position opposing them misses the mark,” said Dave Fintzen, the vice president of the NEA at JetBlue.
Fintzen pointed out that the United States (US) District Court for the District of Massachusetts Judge Leo Sorokin’s ruling resulted in the benefits being wound down at short notice.
“Even as these benefits end, we are still committed to minimizing disruption to existing travel plans and continuing to deliver great value and our award-winning product and service to our customers,” the JetBlue executive added.
Meanwhile, American Airlines said that these are the first steps in the process of winding down the “pro-competitive, pro-consumer” alliance to take place over the next few months.
“We will continue to work with the JetBlue team to ensure customers who have existing codeshare bookings can travel seamlessly without disruption to their travel plans,” the airline noted in a statement.
Unfair competition
Sorokin ruled on May 19, 2023, that the NEA violated the Sherman Act, a fair competition law in the US, with the judge arguing that the alliance “substantially diminishes competition in the domestic market for air travel”.
The judge initially gave the carriers 30 days to unwind the NEA.
During the Bernstein 39th Annual Strategic Decisions Conference, Robert Isom, the chief executive officer (CEO) of American Airlines, reiterated that the alliance’s benefits would “ultimately prevail”.
Isom added that AA would work with the US Department of Justice (DOJ) and JetBlue “to find out exactly what we do in the interim, and we’re going to do that.”
At the same conference, the airline’s chief financial officer (CFO) said that the NEA is not an important revenue-generating source with its “non-hub flying out of New York is something less than or around 5% of our total system capacity”.
While both airlines won more time to unwind the NEA in late June 2023, JetBlue backed out of the appeal process in July 2023.