By David Shepardson
WASHINGTON (Reuters) – Irish airline Aer Lingus received tentative U.S. approval on Monday to join the Oneworld carrier alliance, the U.S. Transportation Department announced, a move that will give the joint venture control of more than half of the U.S.-Ireland flight market.
Airlines are expected to expand capacity on some existing routes while introducing service on several new routes, allowing more options for travel between the United States and Ireland as well as the rest of Europe, the department said.
The alliance includes American Airlines <AAL.O>, British Airways, OpenSkies SAS, Iberia, and Finnair. The carriers requested the U.S. agency extend the joint venture’s antitrust immunity to include Aer Lingus.
The approval will integrate Aer Lingus into Oneworld’s network planning, pricing and sales. Aer Lingus did not immediately comment.
Aer Lingus controls 44% of the U.S.-Ireland flight market, a figure that will rise to 60% for the alliance.
In 2015, International Consolidated Airlines Group (IAG) <ICAG.L>, the parent company British Airways, Iberia and OpenSkies, acquired Aer Lingus. The group petitioned in 2018 to allow Aer Lingus join the alliance.
Despite the alliance’s majority market share, the U.S. regulator noted steps that it said would support competition.
As a condition of approval, the department proposed Oneworld maintain commitments to release landing and takeoff gate slots at London airports to competitors. Those were imposed when the alliance was first approved in 2010.
In addition, the U.S. Transportation Department noted the presence of a strong competitor outside the alliance. It said the second-largest carrier in the Irish-U.S. market, low-cost airline Norwegian <NWC.OL>, “has shown an aggressive ability to challenge established carriers in the transatlantic market with its low-fare pricing model.”
The Transportation Department also argued that new aircraft models will allow airlines to fly transatlantic routes with fewer seats and lower costs.
The public can comment on the tentative decision for two weeks before it is finalized.
(Reporting by David Shepardson; Editing by Cynthia Osterman)