American Airlines, Qantas drop bid for deeper partnership amid DOT pushback

American Airlines, which in June 2015 asked the US government for permission to expand its existing alliance with Australia's Qantas, on Monday withdrew its application, 10 days after the US DoT tentatively ruled that the plan would harm competition in the US-Australasia market. American, which already code-shares and offers frequent-flier reciprocity with Qantas, had hoped to win antitrust immunity to deepen and expand the relationship into a revenue-sharing joint venture. Delta has such an arrangement with Virgin Australia Airlines, and United Continental with Air New Zealand. But the US government said the proposed partnership would account for nearly 60% of US-to-Australia seats and enjoy the largest market share on nearly 200 routes. The DOT also questioned the proposed alliance's public benefits and gave the pair two weeks to respond to its findings. "We remain very disappointed in the decision," American said in a statement. "It represents a significant departure from prior DOT decisions, which have long recognised the pro-competitive benefits of combining complementary international networks." The existing, more limited cooperation will continue between American and Qantas, said American. In a statement, Qantas said regulators in Australia and New Zealand already approved the deal and found it would deliver significant consumer benefits. Qantas said it and American will now separately assess their positions before deciding what they will do next.<br/>