Virgin Awarded Love Field Gates

[Flyer1015]

No, the DOJ told VA they could have it because that is who AA wanted the gates to go to if AA couldn't have them for themselves.

And yes, the city owns the property, last time I checked, that meant something in Texas, and the US of A. The DOJ can suck it.

Yes but per AA's lease agreement on two gates with the city of Dallas, AA can sublease them to another carrier without unduly denial. I just don't see what leg the Dallas city officials are standing on to deny AA's contractual right to sublease the two gates out.

 

[Flyby1206]

Yes but per AA's lease agreement on two gates with the city of Dallas, AA can sublease them to another carrier without unduly denial. I just don't see what leg the Dallas city officials are standing on to deny AA's contractual right to sublease the two gates out.

I agree with you and think it is some serious BS, but I am assuming the city of Dallas feels that since AA cannot use their preferential gates anymore (due to DOJ ruling) then the gates revert back to common use and under the control of the city of Dallas.

 

[Flopgut]

Haven't read anything that says American wanted the gates to go to Virgin. Pretty clear in this link:

http://aviationblog.dallasnews.com/...on-doj-list-for-dallas-love-field-gates.html/


"The DOJ has advised us that Virgin is the only acceptable party from their perspective. We?ve been told by the DOJ that Virgin is their preferred candidate to get these gates.
?Accordingly, we entered into an assignment agreement to assign the gates to Virgin. That was not agreed to by the city."

 

[scoreboardII]

I'm thinking AA would want to keep VA at DFW vice let them have an in at LUV.

 

[Flopgut]

You might be correct to have suspicion, but American is being clear that they are only doing exactly what the DOJ has told them to do

 

[Flyer1015]

I agree with you and think it is some serious BS, but I am assuming the city of Dallas feels that since AA cannot use their preferential gates anymore (due to DOJ ruling) then the gates revert back to common use and under the control of the city of Dallas.

That shouldn't matter. The lease IIRC goes for another 14 years. If AA can't use it then they should be allowed to use their sublease clause of the gate contractual agreement that the city of Dallas officials agreed to. If they have a problem with that then they shouldn't have put a sublease section in their agreement.

Apparently Branson is coming to town. Hopefully this goes the way it should. At no other airport in the country has any airline owned 90% of the gates/operation. No reason SWA should get the additional two gates when they already own 80% of the airport.

 

[HowardBorden]

I'm curious, and I certainly don't know the answer to this question.

Who trumps who? If the DOJ asserts (as it appears it has) that Virgin is the only suitable divestiture candidate for the 2 Love gates and the city of Dallas cites the 5 party agreement which states that if the use of the preferential gates ceases, they come under the control of the city, who wins that argument? Does the DOJ have the authority to ammend the terms of the 5 party agreement?

Obviously they have some authority to abrogate the agreement, because the agreement also stated that AA would retain the rights to the 2 gates in question. But the role of the DOJ in that instance was in relation to the anti-trust case brought forth to remedy alleged harms of the merger. Does the DOJ have the authority to overrule Dallas' assertions that control of the gates goes back to Dallas if AA can no longer utilize those gates?

An interesting debate for sure. It seems that the City of Dallas better be ready to pony up some serious legal fees if they don't follow the DOJ divestiture stipulations. On the other hand, the city and SWA funded the new terminal, shouldn't they have some ability to steer what they consider to be the solution that will be of most benefit to the citizens of that community? Never the less, it will most definitely get more interesting.

 

[Saluki Dawg]

The DOJ is requiring divestment of the gates which means that they go back to the City of Dallas. A sublease by AA to VX is not a divestment in this case since AA would retain ownership of the gates. That's why the Dallas City Council is holding a vote later this week. They will ultimately decide which Airline will get the gates, not AA, VX, or the DOJ.

 

[FurloughedAgain]

I think the problem is that Virgin was never limited in its growth if the Dallas market. It can grow as large as it wants to at DFW. So why are they planning this big expansion only if given gates at the cross town airport? Theoretically, couldn't they do whatever they want at DFW and still create the competition, low fares, and additional jobs even if they don't get the gates?

I guess my point is, if you want to compete for the gates, go for it. Keeping in mind that SWA does not have the ability to expand at DFW (even if they wanted to) and virgin can open a mega hub in Dallas with or without the gates if they like.... one could argue that giving SWA the last gates and holding their feet to the fire regarding the expansion would actually create MORE competition IF Virgin chooses to go ahead and expand anyway, but in DFW.

That said, I don't think it would hurt SWA for it to have some progressive new competition in DAL. Virgin has a great product and strong competition can only make SWA a better competitor. It might spark a little innovation from SWA that would not have otherwise existed. I don't think competition is ever a bad thing, but to create a level playing field IF Virgin gets the gates, the DFW and international flight restrictions that remain from the Wright amendment need to be eliminated. (Even if SW chooses not to avail itself of them)

 

[scoreboardII]

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