The US Justice Department has moved to block the attempted $3.8bn merger of JetBlue and Spirit Airlines.
The merger, if completed, "would eliminate the unique competition that Spirit provides—and about half of all ultra-low-cost airline seats in the industry—and leave tens of millions of travellers to face higher fares and fewer options,” the department claimed in a filing to a Massachusetts court and in a subsequent statement.
Spirit Airlines said in early February that it expected the department to file a suit on the matter within about 30 days. Many in the industry had expected the department to try to stop the merger.
The department, backed by the Attorneys General of the Commonwealth of Massachusetts, the State of New York, and the District of Columbia, said that any JetBlue acquisition of Spirit "will have lasting negative impacts on consumers".
JetBlue said before the department filing that the merger would add to competition for the so-called big four airlines and dismissed the government's claims it would undermine competition in low-cost flying as unwarranted as it did not compete with Spirit.
But the department dismissed the New York-based JetBlue's claims in turn, saying it "competes hard against Spirit, and views it as a serious competitive threat"
"But instead of continuing that competition, JetBlue now proposes an acquisition that Spirit describes as ’a high-cost, high-fare airline buying a low-cost, low-fare airline,” the department said.
"The deal also would eliminate half of the ultra-low-cost capacity in the United States. This will lead to higher fares and fewer seats, harming millions of consumers on hundreds of routes", the department added.