Proposed Air Canada-United deal likely to harm market competition: regulator


By Lin Wei

OTTAWA, Oct. 28 (Xinhua) -- A proposed deal between Air Canada and United Airlines to expand coordination would likely harm competition on key routes between Canada and the United States, Canada's antitrust watchdog warned Wednesday.

In a report submitted to the Minister of Transport, the Competition Bureau said the proposed arrangement between the two carriers would likely increase ticket prices on 10 cross-border routes, resulting in millions of dollars in consumer harm each year.

The proposal would allow Air Canada and United to coordinate on pricing and other operational aspects on these routes connecting four major Canadian hubs, Toronto, Montreal, Ottawa and Vancouver, with U.S. cities including Chicago, Cleveland, Denver, Houston, New York, San Francisco and Washington.

Cooperation on these specific routes is currently restricted under a 2012 consent agreement aimed at protecting market competition.

The regulator noted that Air Canada and United currently account for all non-stop passenger traffic on five of the 10 routes and hold significant combined market shares on the others.

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