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JetBlue Airways and Spirit Airlines terminated their merger agreement on Monday. In a letter to staff, newly ascendant JetBlue CEO Joanna Geraghty said they “simply don’t see a path to regulatory approval by the required July 24 deadline,” a date set when the airlines first agreed to merge two years ago.
The deal always faced an uphill battle. While many industry analysts saw a merger as a stronger challenger to the biggest four U.S. airlines, JetBlue’s merger attempt would have eliminated a competitor from the market, a move that faced heavy opposition from the Biden Administration’s Justice Department that has focused its efforts on preventing consolidation in various industries.
Related: Frontier wins in JetBlue-Spirit deal
The fact that Spirit is an ultra low-cost competitor and JetBlue a higher-cost — and higher-fare — competitor only bolstered the regulator’s case. Spirit’s own management saw this obstacle as well, when it attempted to fend off JetBlue’s hostile bid in favor of a merger with Frontier Airlines in 2022. That proved true when a federal judge ruled against the deal in January. Meanwhile, the DOJ’s antitrust division last month requested more information from Alaska Air Group and Hawaiian Airlines on their proposed merger, which has already been approved by the latter’s shareholders, according to company filings.
