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U.S. clears biggest air codeshare with conditions=20
=09
=09
Reuters <http://money.excite.com/img/logo_reuters.gif> =09
Friday January 17, 12:32 PM EST=20
(Updates with airline reaction, details on codeshare)
By John Crawley
WASHINGTON, Jan 17 (Reuters) - The Bush administration said on Friday it
would permit the largest ever U.S. airline marketing alliance to take
effect, but imposed conditions.
After reviewing the proposal for nearly six months, the Transportation
Department cleared the codeshare proposal by Northwest (NWAC
<http://money.excite.com/jsp/qt/full.jsp?time=3D0&symbol_search_text=3DNW=
AC>
), Delta (DAL
<http://money.excite.com/jsp/qt/full.jsp?time=3D0&symbol_search_text=3DDA=
L>
) and Continental (CAL
<http://money.excite.com/jsp/qt/full.jsp?time=3D0&symbol_search_text=3DCA=
L>
) airlines, a government source said.
But the source said the carriers must adhere to a series of conditions,
which the official would not disclose.
"We believe it is the decision that will most benefit consumers," the
official said.
A formal announcement of the plan was expected later in the day.
=20
<http://ae.excite.com/adclick/CID=3D000002397d9372bc00000000/acc_random=3D=
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Officials from Delta and Continental said the carriers were still
waiting for word on the decision. Representatives from Northwest could
not be reached for comment.
Regulators cleared a similar deal between bankrupt carriers United
Airlines (UAL
<http://money.excite.com/jsp/qt/full.jsp?time=3D0&symbol_search_text=3DUA=
L>
) and US Airways (UAWGQ
<http://money.excite.com/jsp/qt/full.jsp?time=3D0&symbol_search_text=3DUA=
WGQ
> ) last year and imposed conditions on overlapping routes.
Codesharing agreements allow airlines to sell seats on each others'
flights, reducing costs. Rather than each running a flight half full,
two could run a single flight near capacity, for example.
Under the plan, the three carriers would also expand their frequent
flier and airport club programs.
Proponents said it will boost revenues at a time of unprecedented
industry financial turmoil and give consumers more choices without
diminishing competition.
Critics assert it will further concentrate the industry among the
biggest domestic airlines and make it harder for new entrants and
low-cost carriers to serve lucrative markets.=20
=A92002 Reuters Limited.=20
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