Antitrust Law: Case Study of Air France and KLM
Antitrust Matters
What is Antitrust Law
Anti-trust law is a law designed to ensure free competition in an open market. The first anti-trust laws have emerged in the United States at the end of 19th century: some companies were so powerful that they had a monopoly or quasi-monopoly in the sector. Companies like Standard Oil and American Tobacco have been dismantled through anti-trust laws. In addition, the antitrust laws prohibit price fixing between competitors.
In 1934, Boeing became a large enterprise, producing aircraft engines, carrying mail, dealing with airports and ensuring many airlines. But under pressure from anti-trust law prohibiting manufacturers to operate airlines, its creators sold their holdings and "United Aircraft and Transport" got divided into three entities:
United Airlines responsible for air transport
United Aircraft responsible for manufacturing in the East
Boeing Airplane Company responsible for manufacturing in Western countries.
United Aircraft and Transport Corporation is a vertically integrated group, present in all sectors of aviation. In 1934, an anti-trust law is to separate aircraft manufacturers companies carrying mail, and forces the company to split into three entities,
United Air Lines in 2011, which is the largest airline in the world
United Aircraft Manufacturing Corporation, which later became the United Technologies Corporation
Boeing Airplane Company, which became in 1941 The Boeing Company.
Case example of Air France / KLM
In September 2003, it was announced by Air France and KLM that they would merge their ownership and begin synchronizing operations, although they would continue to be supposedly separate carriers. This blend of two of Europe 's largest four carriers created the world 's largest airline, as considered by returns. (July 27, 2001)
The typical analysis of an airline merger defines the pertinent geographic markets as each of the city couples that the merging carriers serve.
What is Antitrust Law
Anti-trust law is a law designed to ensure free competition in an open market. The first anti-trust laws have emerged in the United States at the end of 19th century: some companies were so powerful that they had a monopoly or quasi-monopoly in the sector. Companies like Standard Oil and American Tobacco have been dismantled through anti-trust laws. In addition, the antitrust laws prohibit price fixing between competitors.
In 1934, Boeing became a large enterprise, producing aircraft engines, carrying mail, dealing with airports and ensuring many airlines. But under pressure from anti-trust law prohibiting manufacturers to operate airlines, its creators sold their holdings and "United Aircraft and Transport" got divided into three entities:
United Airlines responsible for air transport
United Aircraft responsible for manufacturing in the East
Boeing Airplane Company responsible for manufacturing in Western countries.
United Aircraft and Transport Corporation is a vertically integrated group, present in all sectors of aviation. In 1934, an anti-trust law is to separate aircraft manufacturers companies carrying mail, and forces the company to split into three entities,
United Air Lines in 2011, which is the largest airline in the world
United Aircraft Manufacturing Corporation, which later became the United Technologies Corporation
Boeing Airplane Company, which became in 1941 The Boeing Company.
Case example of Air France / KLM
In September 2003, it was announced by Air France and KLM that they would merge their ownership and begin synchronizing operations, although they would continue to be supposedly separate carriers. This blend of two of Europe 's largest four carriers created the world 's largest airline, as considered by returns. (July 27, 2001)
The typical analysis of an airline merger defines the pertinent geographic markets as each of the city couples that the merging carriers serve.
References: Department of Justice (July 27, 2001) Department of Justice and Several States Will Sue to Stop United Airlines from Acquiring US Airways: Deal Would Result in Higher Air Fares for Businesses and Millions of Consumers. Press Release.