Judge blocks JetBlue and Spirit merger

On 17 January 2024, a federal judge blocked the proposed acquisition of Spirit Airlines by JetBlue. According to the verdict, the reason for blocking is that the merger was anticompetitive and would harm consumers. The case was brought to court by the US government which is seeking to block the merger.

JetBlue and Spirit have the right to appeal the decision and are currently studying on their next steps. According to them, the combined airlines would only have a marketshare of slightly more than 10%, way less than American, Delta, Southwest and United. 

A delay or cancellation of the merger spells bad news for Spirit Airlines which has been struggling financially and is currently not making a profit. As a result of the verdict, the airline's shares on Wall Street dropped a massive 47%, triggering doubts if the airline can survive. 

The shares of JetBlue actually went up 5% after the verdict. Investors and analysts are positive that a potential merger can now be done cheaper or that JetBlue can boost its position if Spirit folds.

The verdict will also be looked at with great interest by Alaska Airlines and Hawaiian Air, which announced a tie-up of their own in December 2023 and is also in the process of clearing all the regulatory hurdles.

Illustration by JetBlue.