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Judge blocks JetBlue from acquiring Spirit Airlines

nytimes.com

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Re: Judge blocks JetBlue from acquiring Spirit Airlines

#71

Post by coldcode »

tyingq wrote: post #67
iclosem wrote: post #51

Earlier quoted context omitted.

But without this deal they will go bankrupt and then there will be no Dollar General of the skies and the customer loses. Maybe allowing private markets to work would have been a good idea?

Spirit runs with a 28 inch seat pitch, which is often physically shorter than the distance between someone's rear end and knee caps[1]. It's an unusual choice. Most other low cost carriers have 31 inches or more. I'm not sure Dollar General is the right comparison. [1] Once you account for the padding, the angle you have to sit at, etc. Even if you aren't unusually tall, it is noticeably awkward and cramped.

I have never flown Spirit due to being 6'5". 30 in seat pitch is anatomically the limit, and that hurts. JetBlue having 33 in makes it a good choice for me.

Re: Judge blocks JetBlue from acquiring Spirit Airlines

#72

Post by no_wizard »

HWR_14 wrote: post #61
pxx wrote: post #59

Earlier quoted context omitted.

Considering reorganization under bankruptcy is not equivalent to going out of business.

While true, it is equivalent to shareholders in that they get wiped out.

I don't feel sorry for shareholders here. There are risks with all investments and its not as if Spirit mislead investors or acted fraudulently. Sometimes, investments go bad, thats the risk.

We shouldn't prioritize shareholders over the general health of a marketplace

Re: Judge blocks JetBlue from acquiring Spirit Airlines

#73

Post by kyrra »

_zagj wrote: post #35

Meanwhile MSFT, a monopolist megacap, was allowed to buy Activision-Blizzard?

The general principle of the current administration is that big is bad.

https://www.wsj.com/articles/unfortunately-big-is-bad-is-bac...

We have seen this with of the merger challenges that have happened since Biden took office. Trump also tried to block a few, mainly out of his own ego from what I could see. (AT&T-Time Warner Deal specifically).

Re: Judge blocks JetBlue from acquiring Spirit Airlines

#75

Post by ramesh31 »

jsyang00 wrote: post #6

This is a bad ruling, Spirit is likely to go under without acquisition. Neither firm had particularly large share of market.

> Neither firm had particularly large share of market.

Yeah, exactly. Spirit competes with JetBlue on multiple routes which would otherwise be monopolized by the big three (American, United, Delta). This merger would have given JetBlue an almost total monopoly on the east cost low fare market. An unconditional win for the consumer.

Re: Judge blocks JetBlue from acquiring Spirit Airlines

#76

Post by [deleted] »

pxx wrote: post #59
iclosem wrote: post #51

Earlier quoted context omitted.

But without this deal they will go bankrupt and then there will be no Dollar General of the skies and the customer loses. Maybe allowing private markets to work would have been a good idea?

Considering reorganization under bankruptcy is not equivalent to going out of business.

[deleted]

Re: Judge blocks JetBlue from acquiring Spirit Airlines

#77

Post by thereddaikon »

jsyang00 wrote: post #6

This is a bad ruling, Spirit is likely to go under without acquisition. Neither firm had particularly large share of market.

Sometimes I wonder if we should go back to the days of regulated airways. Yeah the cheapest ticket will be $500 but these things wouldn't be a problem anymore.

Re: Judge blocks JetBlue from acquiring Spirit Airlines

#78

Post by rising-sky »

adabyron wrote: post #65
dtnewman wrote: post #46

I am personally happy with this decision. I don’t love flying spirit but I respect them, ever since hearing their former CEO speak on a Planet Money podcast. He said straight up that Spirit Airlines is aiming to be the Dollar General of the skies. If you want something luxurious, go elsewhere. But he called out the other airlines who pretend like they are the Nordstrom of the skies, but don’t actually live up to that…

It should be noted that these were 2 small airlines trying to merge together with very little overlap & a willingness to divest more if the Government would work with them. The government refused to talk divestures & it seemed just wanted to block this deal to set a precedence. I do not think they care about Spirit's future or competition here. Another important item from the trial - only 1/3 of Spirit customers pay…

> Rivals on average cut prices 7% to 11% when Spirit enters a market[1][2].

The same cannot be said for JetBlue

> “If JetBlue were permitted to gobble up Spirit — at least as proposed — it would eliminate one of the airline industry’s few primary competitors that provides unique innovation and price discipline,” Young wrote. “… Worse yet, the merger would likely incentivize JetBlue further to abandon its roots as a maverick, low-cost carrier.”[2]

> This could really crush M&As in America.

That's a bit hyperbolic. If it does crush anti-competitive / anti-trust mergers, that's a win in any capitalist's book

[1] https://money.usnews.com/investing/news/articles/2024-01-16/... [2] https://www.washingtonpost.com/transportation/2024/01/16/jet...

Re: Judge blocks JetBlue from acquiring Spirit Airlines

#79

Post by haliskerbas »

dtnewman wrote: post #46

I am personally happy with this decision. I don’t love flying spirit but I respect them, ever since hearing their former CEO speak on a Planet Money podcast. He said straight up that Spirit Airlines is aiming to be the Dollar General of the skies. If you want something luxurious, go elsewhere. But he called out the other airlines who pretend like they are the Nordstrom of the skies, but don’t actually live up to that…

Spirit also doesn’t live up to that in my experience. Their cost structure nickel and dimes the consumer so much that by the time you get to the destination you may have paid more for a much less comfortable trip.

At least in my anecdotal experience.

Re: Judge blocks JetBlue from acquiring Spirit Airlines

#80

Post by nerdjon »

As someone who basically flys exclusively JetBlue when I have the choice, I am disappointed by this.

JetBlue's biggest problem remains their access to airports, if they were able to get more access to that they would likely be a serious threat to the bigger airlines.

I don't understand how this is bad for competition when we desperately need more competition that can actually compete.

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