Continental receives final approval to join Star Alliance

The U.S. Department of Transportation (DOT) has approved Continental Airlines’ application for joining the existing antitrust immunized alliance including United Airlines and eight other Star Alliance member carriers.

In addition to United, the eight Star Alliance members who have been granted DOT approval for antitrust immunity are Air Canada, Austrian, bmi, Lufthansa, LOT Polish Airlines, Scandinavian Airlines (SAS), SWISS and TAP Air Portugal.

The department said in a news release that the immunity would “support increased levels of service in international markets served by the carriers, give consumers more travel options and shorter travel times and reduce fares.”

The DOT order came two weeks after the Justice Department termed the plan as harmful to consumers and competition. The Department of Justice, consumer advocates and travel agents, argue that such deals hurt passengers by reducing competition – a position the Transportation Dept. has largely rejected in its recent alliance reviews.

With this development, Continental and United have scored a big win as the DOT agreed to their request to coordinate flight schedules, prices and marketing efforts on trans-Atlantic flights. The government’s assent on antitrust immunity represents a key component of the airlines’ plan for a close working relationship. The decision will allow Continental and United to coordinate their capacity to Europe, and set fares, while allowing joint marketing and frequent-flier programme activities. 

The Continental-United decision could also play a role in the continuing assessment of a similar application from American and British Airways.