Regulators approve marketing deal among Nos. 3, 4 and 5 airlines

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Regulators approve marketing deal among Nos. 3, 4 and 5 airlines

WASHINGTON (AP) =97 Federal regulators gave the go-ahead Monday for Delta,=
=20
Northwest and Continental airlines to sell seats on each other's flights.=20
The Nos. 3, 4 and 5 airlines reached an agreement with Transportation=20
Department officials after threatening in January to ignore conditions the=
=20
government imposed on their original plan. Regulators were concerned the=20
"code-share" plan would stifle competition. "This was one that I was=20
worried was going to end up in civil war," said Darryl Jenkins, head of=20
George Washington University's Aviation Institute. The airlines agreed to=20
give up airport gates, but not as many as the Transportation Department=20
originally wanted. They agreed to limits federal regulators imposed on the=
=20
number of code-share flights, but only for two years. And they agreed to=20
some, but not all, restrictions on how they can market joint contracts to=20
travel agents and corporations.

In a statement, the Transportation Department said it will monitor the=20
airlines to make sure the agreement doesn't reduce competition. The=20
code-sharing agreement among Delta, Continental and Northwest will allow=20
them to reach more destinations without flying more planes and to offer=20
reciprocal benefits such as frequent flier miles. "This alliance will bring=
=20
consumers lower fares, increased service levels and broader choices of=20
destinations," the airlines said in a statement. They intend to implement=20
the plan this summer. Delta was the force behind the agreement because it=20
wanted to protect its East Coast routes against US Airways and United=20
Airlines, which entered into a similar agreement in October, Jenkins said.=
=20
The government required US Airways to code share with United as a condition=
=20
of its obtaining a $900 million federal loan guarantee. The airline closed=
=20
on the loan and emerged from bankruptcy on Monday. Jenkins said the=20
code-sharing agreement would at best minimize the damage the airlines are=20
suffering because of poor management, overcapacity, high labor costs and=20
fewer passengers due to the war in Iraq.


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