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American Airlines, Inc. and British Airways PLC

The Applicants submitted data in their joint application that seem to reflect an assumption that all London airports constitute a single market, such that a dominant presence at one airport will not give them market power over the "London market" as a whole. However, both NW, CO, and Delta argue that many travelers do not consider LHR and LGW as substitutes for each other and that an airline with a dominant presence at one airport may therefore have market power in at least some relevant markets at that airport. Accordingly, they argue that the Department should analyze each London airport as a discrete unit, rather than analyze all three London airports in the aggregate.

While we do not here address the merits of this question, we agree with NW that there must be sufficient data in the record of this proceeding to address them. NW requests data that are essential to our analysis of this issue. Although some data are already available through existing sources, in the interest of establishing an easily comprehensible record of this proceeding, we believe that the Applicants are best positioned to compile this data and provide them to the Department. Submission of the data should not be burdensome on the Applicants, and they have not argued that it would be. Moreover, our Notice finding the application complete specifically stated that additional data might be required. Therefore, we grant NW's motion with respect to items 1-5 and 7.

The information described in items 5-8 is crucial to making a reasonable forecast of the public benefits that would result from the Applicants' proposed alliance. The Applicants must use their best efforts to provide the information described in items 5-8 of NW's motion, as limited in time by this order, or a reasonable forecast of their route plansand slot usage. If they cannot provide any information on one or more of these items, they should explain why they are unable to do so. To the extent that schedules are tentative or not final, the information provided should be so qualified.

Finally, we acknowledge that the burdens imposed on airline management and employees by the tragic events of September I I and their aftermath may make more difficult their efforts to prepare their arguments and analyses in this proceeding. However, while we are sympathetic to the demands placed on the resources of the parties, we strongly believe that we must move forward with the public's business as required by the exigencies of this case, and that the schedule we recently announced will give the parties an adequate opportunity to present their case in this proceeding.

Therefore, we are requiring the Applicants to file these data in the docket within 3 business days of the date of service of this order. We believe that this time frame does not necessitate an extension of the date for answers, which was recently extended to October 19.

By:  Susan McDermott

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