What the potential JetBlue and Spirit merger could mean for consumers

As JetBlue prepares to start its takeover of Spirit Airways in a $3.8 billion deal, many are questioning what the long run holds for airways and their loyal prospects.

The JetBlue-Spirit deal remains to be topic to a shareholder vote and regulatory approval, which may show troublesome if federal officers consider the deal would cut back competitors and lift fares. Spirit is thought for its barebones and deep low cost fares, whereas JetBlue is extra of a full-service airline.

“I believe that is unhealthy information for vacationers,” Scott Keyes, founding father of Scott’s Low cost Flights, stated in an interview with ABC Information. “Airline competitors is the most important determinant of what number of low-cost flights you see on a given route.”

Keyes stated Spirit is an “anchor” within the airfare market and its low fares are inclined to drive down ticket costs supplied by main carriers.

“Your Delta fares, your US fares are literally cheaper in the event that they’re on a route the place they’re competing with Spirit, as a result of they must decrease these fares to attempt to compete and get extra prospects,” Keyes stated.

JetBlue CEO Robin Hayes stated the acquisition could possibly be a “answer to the shortage of competitors” within the US airline trade, saying in a press launch: “Spirit and JetBlue will proceed to advance our shared purpose of disrupt the trade to drive down the fares of the large 4 airways.

Whereas consultants say Spirit’s shareholder vote ought to move, JetBlue is predicted to face regulatory hurdles.

“[The Department of Justice] will attempt to mannequin what’s going to occur with one much less airline. What’s going to this do for route construction, load components, capability and fares,” Ravi Sarathy, professor of worldwide enterprise and technique on the D’Amore-McKim Faculty of Enterprise from Northeastern College. “And they’re going to additionally attempt to mannequin whether or not it’s going to enhance general air high quality and flight service high quality.”

Sarathy stated the merger may assist enhance JetBlue’s product. With the $3.8 billion buy, JetBlue would additionally achieve Spirit’s Airbus fleet and employees of pilots – each in excessive demand as airways grapple with continued pilot shortages and delayed plane deliveries. because of provide chain disruptions.

“The query might be whether or not Spirit passengers need higher service or are they actually extra involved with the bottom attainable flight value?” Sarah stated. “That continues to be to be seen.”

JetBlue gives stretch seats on some transcontinental routes and to London, whereas Spirit doesn’t have a First Class/Enterprise Class cabin. JetBlue additionally gives complimentary in-seat leisure and snacks; Spirit doesn’t have onboard televisions or free meals. It’s unclear how the 2 airways would merge their merchandise if a merger have been permitted.

Spirit shareholders are anticipated to vote subsequent month on the merger. If this vote passes, a evaluate by the federal authorities may take months and even years.

ABC Information’ Sam Sweeney contributed to this report.