BEFORE THE

DEPARTMENT OF TRANSPORTATION

WASHINGTON, D.C.

Joint Application of

ALASKA AIRLINES, INC.

AND

AMERICAN AIRLINES, INC.

for transfer of international route authority under

49 U.S.C. § 40109 , 41105

( Los Angeles

- Mexico City ) )

)

)

)

)

)

)

)

)

)

) Docket DOT

- OST

- 2015

- 0025

ANSWER OF DELTA AIR LINES

Communications with respect to this document should be addressed to:

Robert J. Cortelyou

Senior Vice President

– Network Planning

Joe Esposito

, Vice President

- Network Planning

Americas

Amy Martin, Director, Network Planning, Latin

Amercia

DELTA AIR LINES, INC.

1030 Delta Boulevard

Atlanta, Georgia 30320 Alexander Van der Bellen

Managing Director

– Regulatory and International

Affairs & Associate General Counsel

Christopher Walker

Regional Director

– Regulatory and International

Affairs

DELTA AIR LINES, INC.

1212 New York Avenue, N.W.

Washington, D.C. 20005

(202) 842

- 4184

sascha.vanderbellen@delta.com

chris.walker@delta.com

February 26

, 2015BEFORE THE

DEPARTMENT OF TRANSPORTATION

WASHINGTON, D.C.

Joint Application of

ALASKA AIRLINES, INC.

AND

AMERICAN AIRLINES, INC.

for transfer of international route authority under

49 U.S.C. § 40109, 41105

(Los Angeles

- Mexico City) )

)

)

)

)

)

)

)

)

)

) Docket DOT

- OST

- 2015

- 0025

ANSWER OF DELTA AIR LINES

Delta Air Lines, Inc. (“Delta”) hereby answers in opposition to the Joint

Application of Alaska Airlines, Inc. (“Alaska”) and American Airlines, Inc. (“American”) to

transfer Alaska’s Los Angeles ( LAX )

- Mexico City ( MEX ) exemption authority to

American. American proposes to offer two (2) dai ly frequencies in the market. Today

Delta is filing a superior competing application for three (3) daily LAX

- MEX flights which

will better serve the public interest. Under well settled principles of administrative law

the Department must institute a rou te case to decide the merits of the competing

applications. 1

American and Alaska inappropriately rely on the certificate transfer provisions of

49 U.S.C. 41105 to support their request for transfer of limited term exemption and

designation authority. T hese authorities are limited in nature and are expressly subject

to revocation and reallocation provisions

. In Order 97

- 11

- 35 the Department made

1 Ashbacker Radio Corp. v. FCC, 326 U.S. 327 (1945)Delta Answer

Page 2

clear that the certificate transfer provisions of section 41105 do not apply to frequency or

exemption allocations:

The case before us is a frequency allocation case. While some of the parties

have invoked route transfer cases as precedential guidance, the tr ansfer

language of the act relates to the transfer of certificate authority. Frequency

allocations are not certificate awards. We have traditionally deemed them to be

in the nature of exemption authority. As with exemptions we typically grant

frequency authority for a limited period of time

– in limited entry markets for no

more than one year. As with exemptions we award frequency allocations on the

express basis that we may modify or revoke them in our discretion and without

hearing. Furthermore we m ake frequency allocations subject to a 90 day

dormancy provision whereby frequencies automatically revert to the Department

if they are not being used by the authorized carrier. Certificate holders, on the

other hand, have specifi c rights under the provis ions of section 41110 of the Act

concerning their certificate authority, even in cases where their authority has

been dormant.

We have treated frequency awards in this fashion because in the limited

- service

mark e ts where we must make such awards we have w anted to preserve

maximum flexibility to respond to changing conditions, whether in terms of the

operations of carriers already serving, the interests of carriers that might want to

serve, the overall state of the applicable bilateral relationship, or any other public

interest factors.

Id. at pp 5

- 6.

For good reason the Department appropriately and correctly decided that

temporary exemption and frequency awards should be subject to reevaluation on their

public interests merits. Just as the Department decided in Order 97

- 11

- 35, a route case

should be instituted here to decide the merits of which competing application

– Delta at

three daily frequencies, or American at two daily frequencies

– would best serve the

public interest. American and Alaska ina ppropriately rely on merger precedent to

support this discrete, one

- off transaction of exemption authority. Contrary to theseDelta Answer

Page 3

assertions, DOT and Congress have made clear that different rules apply to wholesale

mergers; for example , with respect to DCA slot exemptions :

49 U.S.C. 41714 (j) EXEMPTIONS MAY NOT BE TRANSFERRED.

— No

exemption from the requirements of subparts K and S of part 93 of title 14, Code

of Federal Regulations, granted under this section or section 41716, 41717, or

41718 may be boug ht, sold, leased, or otherwise transferred by the carrier to

which it is granted, except through an air carrier merger or acquisition

. (emphasis added)

American and Alaska are not merging. American and Alaska are not transferring

a certificate as contemplated by section 41105. And, the public interest requires a

thorough and thoughtful examination of the disposition of these temporary exemption

and des ignation authorities.

As detailed in Delta’s Application, Delta has been growing its presence in Los

Angeles to provide a strong, competitive hub network to United and American which

have historically dominated service at LAX. The award of LAX

- Mexico City Authority to

Delta will enhance competition at this important gateway.

Respectfully submitted,

_____________________

Alexander Van der Bellen

Managing Director, Regulatory and

International Affairs & Associate General

Counsel

DELTA AIR LINES, INC.CERTIFICATE OF SERVICE

A copy of the foregoing Answer has been served this 26 th day of February, 2015

, upon the following persons via email:

Air Carrier Name Email Address

Alaska Airlines David Heffernan dh e ffernan@cozen.com

Alaska Airlines Marshall Sinick sandysinick@gmail.com

American Howard Kass howard.kass@aa.com

American Robert Wirick robert.wirick@aa.com

Frontier Mark Atwood matwood@cozen.com

Frontier Steve Lachter stephen.lachter@lachterlaw.com

Hawaiian/JetBlue Jonathan Hill jhill@cooley.com

Hawaiian/JetBlue Parker Erkmann perkmann@cooley.com

JetBlue Robert Land robert.land@jetblue.com

Republic Bob Cohn robert.cohn@hoganlovells.com

Republic Pat Rizzi patrick.rizzi@hoganlovells.com

Southwest/AirTran Bob Kneisley bob.kneisley@wnco.com

Southwest/AirTran Leslie Abbott leslie.abbott@wnco.com

Spirit Airlines David Kirstein dkirstein@yklaw.com

Spirit Airlines Joanne Young jyoung@yklaw.com

Sun Countr y John Fredericksen john.fredericksen@suncountry.com

Sun Country Thomas Ting thomas.ting@suncountry.com

United Dan Weiss dan.weiss@united.com

United Thomas Bolling thomas.bolling@united.com

Virgin America Barbara Russell barbara.russell@virgi namerica.com

Brian Hedberg brian.hedberg@dot.gov

Robert Finamore robert.finamore@dot.gov

Brett Kruger brett.kruger@dot.gov

Reese Davidson r eese. d avidson@dot.gov

Info info@airlineinfo.com