JetBlue Once Considered Buying Alaska Airlines

Court proceedings tend to bring out revelations during the trial. Here’s one.

During the Department of Justice antitrust lawsuit looking to block the merger between JetBlue Airways and Spirit Airlines, it was revealed Monday that JetBlue tried to buy Alaska Airlines.

Whether it has a significant impact on the trial remains to be seen, but at the very least, it confirms JetBlue’s growth strategy through acquisition.

In fact, JetBlue CEO Robin Hayes testified that JetBlue did indeed look to merge with several other smaller airlines as it looked to compete with American, Delta, United and Southwest. Together, those four airlines control about 80 percent of the airline market.

As recently as 2015, JetBlue tried to buy Virgin America but was outbid by Alaska Airlines. JetBlue paid $3.8 billion to merge with Spirit Airlines last year in a deal that is currently under scrutiny by the Department of Justice.

Some observers think JetBlue might have overpaid in its battle with Frontier to merge with Spirit.

Although it was rebuffed from buying Virgin America, JetBlue never abandoned its acquisition strategy. The airline had its eye on two other carriers in 2017, one of which was Spirit, but the other carrier was redacted in court documents.

At the time, the plan was put on the shelf because the purchase price of Spirit was too expensive. But JetBlue called on Spirit in 2019 in a deal dubbed "Project Exchange." Hayes saw it as an opportunity to challenge the Big Four airlines.

If this deal is approved, Hayes said he doesn’t see any further acquisitions, primarily due to the possibility of regulatory denial.

Spirit’s testimony last week that it held the same view about acquisition being the only way to compete with the Big Four could also be a relevant factor.

No matter what the outcome is, the trial is expected to have a profound impact on aviation.

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