So, the Dallas Morning News Aviation Blog has THIS entry about the United States telling Japan to slow down on their assumptions that all alliances applying for antitrust immunity in anticipation of a new Open Skies treaty between our two fine country will receive approval.  Apparently the Japanese government has been presuming that any and all applications are a done deal and approval is just pro forma.   So the United States went to Japan and essentially said “Yeah.  Not so fast.  Not only do we not choose the alliance for our companies, but we actually don’t just rubber stamp things either.”

With all the talk over the past two weeks about how it was all but announced that JAL would switch to an alliance with Delta and SkyTeam, I could not understand how everyone could regard that as a done deal.  Such an alliance meant that 50% or more of the trans-Pacific traffic between the US and Japan would be owned by a cooperating alliance.   In the airline world, that’s market power. 

To put my puzzlement in perspective, the trans-Pacific BA/AA/Iberia alliance wouldn’t come to close to controlling that much of the UK/US traffic and, yet, the DoJ and DoT have *not* given blanket approval to that application.  The DoJ asked for modifications and the DoT (which actually gives the approval and which is more friendly in general to airlines) is waiting for more comments.

So, as I’ve already written a couple of times, I didn’t see an anti-trust immunity agreement between JAL and Delta as necessarily anything genuinely possible.  Frankly, I don’t know why Delta thinks it so doable either but from their perspective, there is no harm in trying to form the alliance. 

This is the cultural difference that exists between Japan and the United States.  In Japan, government still very much has a hand in the direction of businesses and, in particular, the airline industry.  Japan, despite its size, remains essentially a two airline country where one of those airline (JAL) has been a government arm for its entire existence.  From Japan’s point of view, if the US wants an Open Skies agreement and knows that granting immunity is essential to that agreement, then surely the US will make that happen regardless.  Obviously, our government doesn’t work that way.

I suspect that was a rather stunning reveal for the Japanese government and the executives at JAL.  I also suspect that the CEO of American Airlines, Gerard Arpey, smiled yesterday despite everything else slamming into AA this week.   Now that I understand what was going on on this subject, I reaffirm my belief that, ultimately, JAL will stay with Oneworld if only because of anti-trust issues and the extreme difficulties and logistics of getting such an agreement to pass in Washington, DC.

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