U.S. limits Hawaiian Airlines and JAL’s planned partnership

Oct 3, 2019

This post contains references to products from one or more of our advertisers. We may receive compensation when you click on links to those products. Terms apply to the offers listed on this page. For an explanation of our Advertising Policy, visit this page.

Hawaiian Airlines and Japan Airlines have big plans to work together across the Pacific, easing travel between Hawaii and Japan for passengers.

Those plans deflated a little Thursday following the U.S. Department of Transportation’s tentative ruling on the partnership. While giving Hawaiian and JAL a nod to cooperate more, the regulator did not grant them immunity to do things like coordinate fares or schedules.

Hawaiian and JAL are free to expand their codeshare agreement and to make other passenger-friendly moves, such as expanding reciprocal frequent-flyer benefits and optimizing schedules for connections both over Honolulu (HNL) and Tokyo Haneda (HND), the DOT said.

Related: Hawaiian and JAL Want to Form a Joint Venture

However, the airlines remain hamstrung by U.S. antitrust laws under the decision. This means they cannot coordinate fares or jointly schedule flights in markets where they overlap, like between Honolulu and Tokyo Narita (NRT).

Immunity “is not necessary for [Hawaiian and JAL] to deliver substantial new [public] benefits,” wrote Joel Szabat, assistant secretary of aviation and international affairs at the DOT, in the tentative finding.

Szabat cited, among other things, Hawaiian’s IT systems that have “limited capability to allow for seamless ticketing and reservations with partners.” The airline could have a difficult time implementing an immunized pact with JAL without a more robust technology platform, he added.

“The tentative decision… overlooks the importance of antitrust immunity that major global airline alliances already enjoy, harming a small U.S. carrier like Hawaiian by preventing it from being able to compete on equal footing and offer more competitive choices to travelers between Hawaii, Japan and beyond,” said Hawaiian in a statement. The airline added that they plan to emphasize the benefits of immunity in their response.

Brent Overbeek, vice-president of revenue management and network planning at the airline, told TPG in September that Hawaiian was excited to move forward with its proposed JAL partnership. The tie up would allow the U.S. carrier more access to Japan, particularly domestic points that it does not serve, to expand its footprint in the large market.

Related: Hawaiian Airlines wants to be bigger in Japan with JAL partnership

“So much of [domestic] Japan flying is concentrated in Haneda, having access to that is really, really important to us,” he told attendees at the World Routes conference in Australia.

Hawaii is the top destination for Japanese visitors to the U.S. The islands saw 1.6 million Japanese visitors in 2018, a number second only to Americans, according to the state’s department of tourism.

Hawaiian is set to begin a third daily flight to Haneda in March. The new frequency will be timed to provide better connections to JAL’s domestic flights from the airport, Overbeek said.

Hawaiian and others have 30 days to respond to the DOT’s preliminary decision, after which the regulator can either revise it or issue a final ruling.

Featured image by Getty Images.

Related: Get the latest airline news delivered right to your in-box with the TPG newsletter

 

Delta SkyMiles® Platinum American Express Card

Earn 90,000 bonus miles and 10,000 Medallion® Qualification Miles (MQMs) after you spend $3,000 in purchases on your new card in the first three months of card membership. Offer ends 11/10/2021.

With Status Boost™, earn 10,000 Medallion Qualification Miles (MQMs) after you spend $25,000 in purchases on your Card in a calendar year, up to two times per year getting you closer to Medallion Status. Earn 3X Miles on Delta purchases and purchases made directly with hotels, 2X Miles at restaurants and at U.S. supermarkets and earn 1X Mile on all other eligible purchases. Terms Apply.

Apply Now
More Things to Know
  • Limited Time Offer: Earn 90,000 Bonus Miles and 10,000 Medallion® Qualification Miles (MQMs) after you spend $3,000 in purchases on your new Card in your first 3 months. Offer expires 11/10/2021.
  • Earn up to 20,000 Medallion® Qualification Miles (MQMs) with Status Boost® per year. After you spend $25,000 in purchases on your Card in a calendar year, you can earn 10,000 MQMs two times per year, getting you closer to Medallion® Status. MQMs are used to determine Medallion® Status and are different than miles you earn toward flights.
  • Earn 3X Miles on Delta purchases and purchases made directly with hotels.
  • Earn 2X Miles at restaurants worldwide, including takeout and delivery and at U.S. supermarkets.
  • Earn 1X Miles on all other eligible purchases.
  • Receive a Domestic Main Cabin round-trip companion certificate each year upon renewal of your Card. *Payment of the government imposed taxes and fees of no more than $75 for roundtrip domestic flights (for itineraries with up to four flight segments) is required. Baggage charges and other restrictions apply. See terms and conditions for details.
  • Enjoy your first checked bag free on Delta flights.
  • Fee Credit for Global Entry or TSA Pre✓®.
  • Enjoy an exclusive rate of $39 per person per visit to enter the Delta Sky Club® for you and up to two guests when traveling on a Delta flight.
  • No Foreign Transaction Fees.
  • $250 Annual Fee.
  • Terms Apply.
  • See Rates & Fees
Regular APR
15.74%-24.74% Variable
Annual Fee
$250
Balance Transfer Fee
N/A
Recommended Credit
Excellent/Good
Terms and restrictions apply. See rates & fees.

Editorial Disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airlines or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

Disclaimer: The responses below are not provided or commissioned by the bank advertiser. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser’s responsibility to ensure all posts and/or questions are answered.