# BEFORE THE

DEPARTMENT OF TRANSPORTATION

WASHINGTON, D.C.



# Joint Application of

AMERICAN AIRLINES, INC.

and DOT-OST-2010

JAPAN AIRLINES INTERNATIONAL CO., LTD.

under 49 U.S.C. §§ 

# 41308 and 41309 for

approval of and antitrust immunity for

alliance agreements

[PUBLIC] JOINT APPLICATION FOR ANTITRUST IMMUNITY



# Communi cat with respect to this document should be sent to:

For American Airlines:

TSUTOMU ANDO VlRASB VAHIDI

Executive Officer

- Senior Vice President

­

International Affairs Planning

Japan Airlines American Airlines, Inc.

International Co., Ltd. P.O. Box 619616, MD 5634

4-11, Higashi shinagawa DFW Airport, Texas 75161

2-chome, ku

Tokyo 140-8637, Japan KENJI C. HASHIMOTO

Vice President

­

TORU MIZUNO Strategic Alliances

Vice President

- American Airlines, Inc.

International Affairs P.O. Box 619616, MD 5635

Japan Airlines DFW Airport, Texas 75261

International Co., Ltd.

4-11, Higashi-shinagawa WILLIAM 

# K. RIS, JR.

2-chome, Shinagawa-ku Senior Vice President

­ Tokyo 140-8637, Japan Government Affairs

American Airlines, Inc.

YUKI SAITO 1101 1 Street, N.W.

Director, Government Affairs Washington, D.C. 20036

Japan Airlines

International Co., Ltd.

1330 Connecticut Ave., N.W.

Washington, D.C. 20036

# WILLIAM KARAS

CAROL GOSAIN



# & Johnson LLP

1330 Connecticut Ave., N.W.

Washington, D.C. 20036

(202) 429-6223

wkaras@steptoe.com

cgosain@steptoe.com

February 12, 2010 ROBERT A. WIRICK

Director, Regulatory

American Airlines, Inc.

P.O. Box 619616, MD 5635

DFW Airport, Texas 75261

(817) 963-0394

robert.wirick@aa.com

W. BRUCE WARK

As General Counsel

JEFFREY A. OGAR

Senior Attorney

American Airlines, Inc.

P.O. Box 619616, MD 5675

DFW Airport, Texas 75261

(817) 967 3458

jeff. .com

CARL B. NELSON, JR.

As General Counsel

American Airlines, Inc.

1101 1 Street, N.W.

Washington, D.C. 20036

(202) 496-5647

carl.nelson@aa.com

# TABLE OF CONTENTS

INTRODUCTION ...................................................... 2

I. THE JOINT APPLICATION IS AN ESSENTIAL PART OF THE

U.S.-JAPAN OPEN SKIES AGREEMENT, AND ITS APPROVAL

WILL ENSURE THAT CONSUMERS ENJOY THE MAXIMUM

BENEFITS OF TRANSPACIFIC LIBERALIZATION ..................... 3

A. U.S.-Japan Open Skies Will Facilitate

Enhanced Interalliance Competition ..................... 4

B. U.S.-Japan Open Skies Will Ensure Competitive

Access To Tokyo Gateway Airports ........................... 5

II. THE JOINT APPLICANTS HAVE PROPOSED AN ALLIANCE THAT

EASILY MEETS THE DEPARTMENT’S STANDARD OF REVIEW ................ 6

A. The Joint Applicants Have Executed Alliance

Agreements That Will Allow **one** world To

Achieve Network Integration Comparable

To Both Star and SkyTeam ................................ 7

1. The JBA Will Create Metal Neutrality

Between American And JAL ........................... 7

2. The Joint Applicants Plan Extensive

Coordination Once The Proposed Alliance

Is Approved And Immunized ........................... 10

3. The Proposed Alliance Is Integral To

**one** world’s Future ................................ 11

B. The Alliance Agreements Meet The Department’s

Standard Of Review For Antitrust

Immunity Applications ...................................... 12

II. THE PROPOSED ALLIANCE WILL CREATE SIGNIFICANT

CONSUMER BENEFITS BY EXPANDING AND INTEGRATING

THE **ONE** WORLD NETWORK, AND WILL MAXIMIZE THE

BENEFITS OF U.S.-JAPAN OPEN SKIES ........................... 13

A. The Full Benefits Of U.S.-Japan Open Skies

Will Not Be Realized Absent Strong

Transpacific Interalliance Competition Among

Star, SkyTeam And **one** world ................................ 13

1. The Department Has Recognized That

Interalliance Competition Is Necessary

For Consumers To Receive The Maximum

Benefits From Open Skies ........................... 13

# - ii –

2. Allowing **one** world To Operate As An

Integrated Joint Venture Will Drive

All Three Globally Branded Alliances

To Deliver Maximum Consumer Benefits ................ 14

B. The Proposed Alliance Will Create Significant

New Consumer Benefits ...................................... 15

1. The Metal Neutrality Created By The JBA

Is Essential To Facilitating An Integrated

Transpacific **one** world Network ..................... 16

2. The Proposed Alliance Will Create Expanded

And Enhanced Route And Schedule Options .......... 17

a. New Transpacific Routes And Service .......... 18

b. New Behind/Beyond Connectivity ................ 20

i. New And Improved Connections .......... 20

ii. Competition With Star/SkyTeam .......... 20

3. Corporate Accounts ................................ 21

4. Combinable Fares

...................................... 22

5. Joint Procurement ................................ 23

III. U.S.-JAPAN OPEN SKIES WILL ENSURE THAT THE PROPOSED

ALLIANCE WILL NOT SIGNIFICANTLY REDUCE COMPETITION .......... 24

A. The Proposed Alliance Will Enhance Global

And Transpacific Network Competition By

Facilitating U.S.-Japan Open Skies ..................... 25

B. The Proposed Alliance Will Not Significantly

Reduce Competition In Any Global, Regional

Or Country-Pair Market ................................ 25

1. Global And Transpacific Interalliance

Competition ...................................... 25

a. Global ...................................... 25

b. Transpacific ................................ 26

2. U.S.-Japan Competition ........................... 27

# - iii –

C. City-Pair Competition ...................................... 28

1. New York-Tokyo ...................................... 28

2. Los Angeles-Tokyo ................................ 29

3. Chicago-Tokyo ...................................... 29

IV. THE JOINT APPLICANTS WILL NOT PROCEED WITH THE

PROPOSED ALLIANCE ABSENT ANTITRUST IMMUNITY ..................... 30

V. OTHER APPROVAL ISSUES, CONDITIONS AND INFORMATION

................ 31

A. Document Production And Responses

To Interrogatories ...................................... 31

B. Transpacific Routes ...................................... 32

C. Transpacific Carriers Within The

Three Alliances ........................................... 32

D. Codeshare Agreements ...................................... 32

E. Relationship To **one** world ................................ 32

F. Hub Airports ........................................... 33

G. Significant Service And

Equipment Changes ...................................... 34

H. Competitive Access To Non-U.S.

Gateway Airports ........................................... 34

I. Impact On Revenue ...................................... 34

J. Labor Issues ........................................... 34

K. Computer Reservations Systems ........................... 34

L. Civil Reserve Air Fleet ................................ 35

M. CRS Booking Data ........................................... 35

N. Resubmission Of Alliance Agreements ..................... 35

O. Conditions ................................................. 35

CONCLUSION ........................................................... 36

# BEFORE THE

**DEPARTMENT OF TRANSPORTATION**

**WASHINGTON, D.C.**

-------------------------------------------------- Joint Application of :

:

AMERICAN AIRLINES, INC. :

:

and :

: DOT-OST-2010-______

JAPAN AIRLINES INTERNATIONAL CO., LTD. :

:

under 49 U.S.C. §§ 41308 and 41309 for :

approval of and antitrust immunity for :

alliance agreements. :

--------------------------------------------------

**[PUBLIC] JOINT APPLICATION FOR ANTITRUST IMMUNITY**

American Airlines, Inc. (along with its affiliates American Eagle

Airlines, Inc. and Executive Airlines, Inc. d/b/a American Eagle) and Japan

Airlines International Co., Ltd. (along with its affiliates Hokkaido Air

System Co., Ltd., J-Air Co., Ltd., JAL Express Co., Ltd., JALways Co., Ltd.,

Japan Air Commuter Co., Ltd., Japan TransOceanAir Co., Ltd. and Ryukyu Air

Commuter Co., Ltd.) jointly apply under 49 U.S.C. §§ 41308 and 41309 for

approval of and antitrust immunity for a bilateral alliance agreement

(Exhibit JA-1) and a metal neutral Joint Business Agreement (“JBA”, Exhibit

JA-2), as well as existing and future agreements implementing the

transactions and arrangements contemplated by the bilateral alliance

agreement and JBA.

# - 2 –

**PUBLIC VERSION** This proposed alliance will create metal neutrality between two of

**one** world’s core transpacific members – American and JAL. These agreements

will provide for revenue sharing and closer integration, giving **one** world the

ability to offer consumers an effective competitive alternative to Star and

SkyTeam in Asia, and will maximize the benefits that the U.S.-Japan Open

Skies Agreement will make possible. American and JAL will implement their

bilateral alliance agreement immediately upon approval, and will implement

the JBA within 18 months of the Department’s final order granting antitrust

immunity consistent with the precedent set in SkyTeam II (Order 2008-4-17,

p. 20).

**INTRODUCTION**

On December 11, 2009, the U.S. and Japan initialed a Memorandum of

Understanding that will eliminate longstanding restrictions on competition

between the U.S. and Japan by bringing into force a landmark Open Skies

agreement. The Joint Applicants applaud the U.S. government for this

achievement, as opening the largest Asian gateway for U.S. traffic will

improve competition on routes to Japan and beyond. Not only will U.S.-Japan

Open Skies work as a catalyst for liberalizing other restrictive bilateral

agreements, but the ability to form integrated networks between U.S. and

Japanese hub airports will create an improved product for all consumers

flying between North America and Asia.

# - 3 –

**PUBLIC VERSION** Relying on this historic agreement, the Joint Applicants have entered

into a bilateral alliance agreement and an integrated metal-neutral joint

venture that will help generate the consumer benefits that Open Skies makes

possible. This proposed alliance will deliver significant consumer

benefits, and creates no risk of harm to competition in any relevant market.

Moreover, prompt approval and antitrust immunity to implement the bilateral

alliance agreement and the JBA are imperative to ensure the implementation

of the U.S.-Japan Open Skies Agreement. Accordingly, the Joint Applicants

apply pursuant to 49 U.S.C. §§ 41308 and 41309 for approval and global

antitrust immunity that will permit consumers to enjoy the full benefits of

Open Skies.

**I. THE JOINT APPLICATION IS AN ESSENTIAL PART OF THE U.S.-JAPAN OPEN**

**SKIES AGREEMENT, AND ITS APPROVAL WILL ENSURE THAT CONSUMERS ENJOY THE**

**MAXIMUM BENEFITS OF TRANSPACIFIC LIBERALIZATION**

The Joint Application is predicated upon the long-sought U.S.-Japan

Open Skies Agreement that will liberalize air transportation between the two

countries, freeing consumers from restraints on competition that have

existed for more than a half century. The Joint Applicants were vigorous

advocates for liberalization, which will allow **one** world to compete more

effectively with Star and SkyTeam for transpacific traffic. U.S.-Japan Open

Skies will remove limits on the number of carriers operating flights between

the two countries, remove restrictions on capacity and pricing, and allow

unlimited opportunities for cooperative marketing agreements between U.S.

and Japanese carriers.

# - 4 –

**PUBLIC VERSION** Prompt approval of this Joint Application will ensure that the U.S.-

Japan Open Skies Agreement becomes effective, enabling consumers to enjoy

the benefits of liberalization at the earliest possible date. Conversely,

any delay in approval could jeopardize implementation, as network

integration between U.S. and Japanese carriers was expressly contemplated

during the intergovernmental negotiations last year, and approval of this

application will facilitate the implementation of U.S.-Japan Open Skies. 1



# A. U.S.-Japan Open Skies Will Facilitate Enhanced Interalliance

**Competition**

The U.S.-Japan Open Skies Agreement contains all of the elements

typically required for full liberalization. It establishes a framework for

significantly expanded transpacific competition by enabling carriers from

both countries to introduce new U.S.-Japan service – including the

restoration of scheduled service between the U.S. and Tokyo’s Haneda

Airport. With capacity increases at Narita Airport planned for March 2010

upon the opening of the Runway B extension, and the planned opening of

Haneda to scheduled transpacific flights in October 2010, the new agreement

is well-timed to enable U.S. carriers to take advantage of new capacity at

these airports.

1 

# A number of open skies agreements with other countries were conditioned on

a grant of antitrust immunity to the countries’ flag carriers, including the

open skies agreements with the Netherlands, Chile, Germany, France, Canada

and Italy.

# - 5 –

**PUBLIC VERSION** The American/JAL relationship is particularly vital to enhancing

interalliance competition across the Pacific. SkyTeam has an extremely

strong position, with Delta’s own-metal connecting hub at Narita, as well as

the immunized Delta/Korean alliance with a hub at Seoul. Star is similarly

strong, with United’s own-metal Narita hub and the immunized United/Asiana

alliance, also with a hub at Seoul. In addition, United is seeking

antitrust immunity with Continental and All Nippon Airways (DOT-OST-2009-

0350). In contrast, **one** world has no U.S. carrier connecting hub at Narita,

and no immunized alliance in Asia. Thus, the proposed American/JAL alliance

is critically important to enhancing competition among the three alliances.

**B. U.S.-Japan Open Skies Will Ensure Competitive Access To Tokyo**

**Gateway Airports**

The U.S.-Japan Open Skies Agreement will create opportunities for U.S.

carriers that do not currently serve Tokyo to launch new service, as well as

opportunities for incumbents to expand their existing operations. Open

Skies will also allow new service between the U.S. and Haneda, adding new

choices for consumers and opportunities to maximize hub connectivity. In

addition, the slot pools at Narita and Haneda will expand substantially

beginning in 2010, creating an unprecedented opportunity for carriers to

obtain access at both airports. Slot allocation will be administered in

accordance with IATA guidelines, ensuring that consumers benefit from both

growth and increased competition.

# - 6 –

**PUBLIC VERSION II. THE JOINT APPLICANTS HAVE PROPOSED AN ALLIANCE THAT EASILY MEETS THE** 

**DEPARTMENT’S STANDARD OF REVIEW**

The JBA is at the heart of the proposed alliance between American and

JAL. The JBA will create a metal neutral joint venture for **one** world’s

transpacific network. It is anticipated that the JBA will be expanded to

other **one** world members and other geographic regions as the alliance’s

integration deepens and matures. The JBA will create stronger interalliance

competition in Asia among Star, SkyTeam (both of which already operate

immunized hubs in Seoul) and **one** world. As the Department noted in SkyTeam

II (DOT-OST-2007-28644), such joint ventures are “likely to result in the

introduction of new capacity and greater availability of discount fares

across the entire joint network – benefits that we tentatively find to be

substantial” (Order 2008-4-17, p. 15).

The JBA will operate alongside a bilateral alliance agreement between

American and JAL. The Joint Applicants plan to use their antitrust immunity

to achieve efficiencies that make their products more attractive to

consumers and more competitive in the marketplace. Thus, the proposed

alliance meets the statutory standards for granting antitrust immunity – it

is necessary “to achieve important public benefits” and it does not

“substantially reduce[] or eliminate[] competition” (49 U.S.C. § 41309(b)).

# - 7 –

**PUBLIC VERSION A. The Joint Applicants Have Executed Alliance Agreements That Will** 

**Allow one** world **To Achieve Network Integration Comparable To Both**

**Star and SkyTeam**

**1. The JBA Will Create Metal Neutrality Between American And**

**JAL**

The Joint Applicants seek approval for a highly-integrated, revenuesharing joint venture that will strengthen their alliance by eliminating

each carrier’s economic incentive to maximize its own revenue. Only the

closer cooperation made possible through a joint venture based on metal

neutrality – or indifference as to which airline actually carries a customer

– will maximize the consumer benefits that immunized alliances make

possible. This is because metal neutrality removes each carrier’s incentive

to act opportunistically in ways that inure to its own short-term financial

advantage, to the detriment of the efficiencies and consumer benefits that

could otherwise be delivered by the alliance.

Accordingly, the Joint Applicants are seeking approval for a highly

integrated joint venture with revenue sharing that creates metal neutrality.

By providing for the broad sharing of revenue on a metal neutral foundation,

the JBA will ensure that American and JAL act for the benefit of – and are

compensated for their contribution to – the alliance as a whole. While the

details of the joint ventures in Star and SkyTeam in prior dockets were

subject to confidential treatment, the Department publicly described the

joint venture approved in SkyTeam II as follows:

# - 8 –

**PUBLIC VERSION** “At its core, the proposed alliance features a joint

venture between Delta, Northwest, Air France, and KLM

(the ‘4-way JV’). Upon implementation, the 4-way JV

will bring all transatlantic services offered by the

venture participants under the control of the venture.

Committees and working groups, composed of senior

representatives from each airline, will jointly plan

and manage capacity, pricing, and financial

settlement. The 4-way JV attempts to align the

economic incentives of the participants to create what

is known in the airline industry as ‘metal

neutrality.’ Instead of competing among themselves for

a greater share of revenue by trying to carry

passengers on their own metal (aircraft), the

participants agree to pool revenues and costs so that

they become indifferent as to which carrier operates

the service. Much like a single firm, the 4-way JV

establishes a common bottom line where, according to

the Joint Applicants, each participant shares the same

incentive to maximize the profits of the venture”

(Order 2008-4-17, p. 3).

The JBA here contains the following key provisions, which are central

to the American/JAL proposal: 2



#  Governance (Article 4): **[REDACTED]**

 Geographic Scope (Section 2.4): **[REDACTED]**

2 

# A grant of immunity here is consistent with the precedent set in SkyTeam

II, in which the Department approved the proposed alliance despite the fact

that “[t]he 4-way JV is not yet ready for implementation. The participants

have yet to agree upon how to value each carrier’s contribution to the

venture, which has implications for how profits and losses are divided”

(Order 2008-4-17, p. 3). The Joint Applicants are prepared to accept the

same condition imposed in SkyTeam II, terminating antitrust immunity unless

the JBA is implemented within 18 months of final approval (Id. at 20).

# - 9 –

**PUBLIC VERSION**  Revenue Sharing (Article 7/Schedule 1): **[REDACTED]**

 Revenue Management/Capacity Planning (Sections 3.3/5.6/5.7):

**[REDACTED]**

 Sales/Marketing (Article 5): **[REDACTED]**

 Frequent Flyer Programs (Section 6): **[REDACTED]**

 Cost Synergies (Section 3.9): **[REDACTED]**

In addition to the JBA, American and JAL have executed a bilateral

alliance agreement that mirrors those approved and immunized in other

dockets, such as SkyTeam II and Star

.

# - 10 –

**PUBLIC VERSION 2. The Joint Applicants Plan Extensive Coordination Once The** 

**Proposed Alliance Is Approved And Immunized**

Approval and immunization of the American/JAL alliance agreements will

enable close integration of the two carriers’ activities – which will make

**one** world a far stronger competitor against the integrated Star and SkyTeam

hubs in Tokyo and Seoul. This coordination will include the following:

 Codesharing : Each Applicant will codeshare on the services operated

by the other to the greatest extent possible. American and JAL are

separately filing for blanket codeshare approvals under the Open

Skies agreement (DOT-OST-1999-4994).

 Pricing : The Joint Applicants will cooperate in establishing fares,

rates and pricing strategies for services provided under their

alliance agreements and JBA.

 Yield Management : The Joint Applicants will cooperate on inventory

control and yield management as those functions relate to services

provided under the alliance agreements. The Joint Applicants will

provide each other with access to their respective yield management

systems, and will consult closely in the yield management process.

 Schedules : The Joint Applicants will jointly plan their respective

schedules and related connecting services in order to maximize and

optimize feasible routings and service options available to

consumers, and to minimize connecting times for the benefit of

consumers.

 Marketing And Product Offering : The Joint Applicants will jointly

market, promote and advertise the services covered by the alliance

agreements. They will also seek to harmonize their respective

service standards and jointly develop new products where

appropriate. The carriers may seek to use an alliance mark or brand

to represent their alliance and to link their frequent flyer

programs.

 Frequent Flyer Programs : The Joint Applicants will offer reciprocal

frequent flyer programs to allow members of one carrier’s frequent

flyer program to accrue mileage and redeem awards on the services of

the other.

 Sales : The Joint Applicants will jointly determine the most

efficient strategies for selling alliance services, coordinating

their sales forces, and allocating their sales resources.

 Airports : The Joint Applicants will determine how to most

efficiently utilize their facilities at the common airports they

serve.

# - 11 –

**PUBLIC VERSION**  Cost Reduction : The Joint Applicants will coordinate their efforts

to reduce costs in a variety of areas, including but not limited to

fuel purchasing, aircraft acquisition, and design and purchase of

replacement parts.

This extensive cooperation will allow the Joint Applicants to generate

significant efficiencies and to provide an improved range of enhanced and

more competitive online services and products to **one** world passengers. The

benefits and efficiencies of this alliance could not be achieved absent

antitrust immunity.

**3. The Proposed Alliance Is Integral To one** world **’s Future**

The proposed alliance will allow **one** world to enhance its product

offerings in ways previously available only to Star and SkyTeam. For

example, unlike Delta and United (which each operate hubs at Narita),

American’s only current access to behind/beyond Tokyo feeder routes is

through non-immunized codesharing with JAL. Once the proposed alliance is

immunized, this competitive imbalance will be remedied and customers will

have more choices, such as corporate customers being able to choose from

integrated network alliance contracts with any one of the three major global

alliances.

# - 12 –

**PUBLIC VERSION B. The Alliance Agreements Meet The Department’s Standard Of Review** 

**For Antitrust Immunity Applications**

The Department has a two-step review process for international

aviation alliance agreements (Order 2008-4-17, p. 4). First, the alliance

must be approved under 49 U.S.C. § 41309, which requires a showing that the

agreements “are not adverse to the public interest and do not violate the

statute” (Id .). This “requires consideration of, among other things,

international comity and foreign policy factors” (Id ., p. 5). Any party

opposing the application “has the burden of proving that it substantially

reduces or eliminates competition and that less anticompetitive measures are

available” (Id .). Once the agreements are approved, the Department has the

“authority to exempt airlines from the antitrust laws to the extent

necessary to allow the transaction to proceed, provided . . . that the

exemption is required by the public interest” (Id .).

The Department’s long-established policy has been to approve and grant

antitrust immunity for alliance agreements if:

(1) the agreements do not eliminate or substantially reduce

competition and are not adverse to the public interest; and

(2) a grant of immunity would be in the public interest and necessary

for the parties to proceed with the transaction (Order 2006-12-

17, p. 8).

The proposed alliance satisfies both prongs of this test. Given the

new U.S.-Japan Open Skies agreement, the proposed alliance will not

substantially reduce competition; to the contrary, it is in the public

interest because it will facilitate Open Skies and promote interalliance

competition. The Joint Applicants will not proceed with the transaction

without antitrust immunity given the potential cost of private litigation.

# - 13 –

**PUBLIC VERSION II. THE PROPOSED ALLIANCE WILL CREATE SIGNIFICANT CONSUMER BENEFITS BY** 

**EXPANDING AND INTEGRATING THE ONEWORLD NETWORK, AND WILL MAXIMIZE THE**

**BENEFITS OF U.S.-JAPAN OPEN SKIES**

**A. The Full Benefits Of U.S.-Japan Open Skies Will Not Be Realized**

**Absent Strong Transpacific Interalliance Competition Among Star,**

**SkyTeam And one** world

**1. The Department Has Recognized That Interalliance**

**Competition Is Necessary For Consumers To Receive The**

**Maximum Benefits From Open Skies**

The proposed alliance is vital for **one** world to compete effectively

with Star and SkyTeam. This increased interalliance competition will in

turn enhance the benefits of the Department’s Open Skies policy – first by

solidifying U.S.-Japan Open Skies, then by serving as a foundation for

further liberalization across Asia. Without approval of the Joint

Application, there would be no U.S.-Japan Open Skies, and thus no new access

to Tokyo’s two gateway airports – Narita and Haneda. Star and SkyTeam –

which both operate connecting hubs at Seoul with antitrust immunized

partners (Asiana and Korean Airlines, respectively), and which both operate

own-metal connecting hubs at Narita – would continue to be advantaged by the

regulatory imbalance created by the current U.S.-Japan bilateral agreement

to the detriment of consumers, and **one** world would continue to struggle as

the smallest of the three global alliances.

# - 14 –

**PUBLIC VERSION** The Department focused on interalliance competition in the Star case,

holding that “any consumer benefits created by a large multilateral

immunized alliance . . . are likely to be greater in the face of the

enhanced competition made possible by a more open air services agreement

between the U.S. and Europe” (Order 2006-12-17, p. 9). 3 

# SkyTeam relied on

this language to support the merger of its two existing transatlantic joint

ventures between Delta/Air France and Northwest/KLM (Joint Application, DOTOST-2007-28644, 6/28/07, pp. 38-39). This is no less true across the

Pacific – approval of the alliance agreements proposed here will give all

three global alliances a strong foundation for competing against each other.

It is beyond question that the creation of an immunized transpacific

**one** world joint venture will generate significant consumer benefits.

**2. Allowing one** world **To Operate As An Integrated Joint Venture**

**Will Drive All Three Globally Branded Alliances To Deliver**

**Maximum Consumer Benefits**

In previous dockets, The Brattle Group demonstrated that **one** world’s

inability to compete effectively across the Atlantic as an integrated

alliance is preventing consumers from enjoying the full measure of public

benefits associated with the Department’s Open Skies policy. The Brattle

Group performed this analysis a number of different ways across several time

periods – and the results were always consistent with the following

conclusions:

3 

# See also Order 2005-2-14, p. 19 (holding that “[a]n award to American in

[the 2006 U.S.-China case] would also promote interalliance competition

because it would permit the **one** world alliance, of which American is a

member, to gain more access to the important China market. The other two

major international aviation alliances have significantly more access, since

Northwest is a member of the SkyTeam alliance, and United is a member of the

Star alliance”).

# - 15 –

**PUBLIC VERSION**  Without competition from a third immunized alliance, the decline of

traditional interlining has led to a dwindling of the number of

significant transatlantic markets with more than two strong

competitors (AA Surreply, DOT-OST-2004-19214, 7/15/05, Exhibit SUR2, p. 13; AA Answer, DOT-OST-2004-19214, 6/24/05, p. 36); and

 The lower fares consumers should be enjoying as a result of Open

Skies bilateral agreements were not materializing in the absence of

strong interalliance competition from **one** world (AA Answer, DOT-OST2004-19214, 6/25/05, p. 36).

The positive trends that the Department found from immunized alliances

in 1999 and 2000 began to disappear as the lack of interalliance competition

across the Atlantic stifled the benefits of Open Skies. Just as final

approval of **one** world’s application for transatlantic antitrust immunity will

break the Star/SkyTeam transatlantic network duopoly, the JBA will prevent

an entrenched Star/SkyTeam duopoly from forming across the Pacific.

**B. The Proposed Alliance Will Create Significant New Consumer**

**Benefits**

Since its creation, **one** world has been severely hampered in its ability

to deliver the full range of possible consumer benefits because it does not

operate with any substantial grant of antitrust immunity. Absent antitrust

immunity for American and JAL, pro-competitive coordination is effectively

precluded because of the threat and potential cost associated with defending

against antitrust litigation. Moreover, the lack of metal neutrality

prevents carriers – even those in an alliance – from acting as a truly

integrated network because self-interest is not always aligned with the

alliance’s collective best interest. This will be remedied by the

implementation of the American/British Airways/Iberia joint business

agreement across the Atlantic pending in DOT-OST-2008-0252, and by the JBA

at issue here between the Joint Applicants on Pacific city-pairs.

# - 16 –

**PUBLIC VERSION** In Star II (DOT-OST-2008-0234), the Department concluded that a metal

neutral joint venture like the JBA is “likely to create substantial public

benefits, and that a grant of antitrust immunity was necessary to realize

those benefits” (Order 2009-4-10, pp. 17-18). The Department found that the

alliance agreements “would likely achieve efficiencies that would facilitate

the introduction of new capacity, give consumers more travel options and

shorter travel times, and reduce fares” (Id . at 5). The Department

concluded that the public interest required a grant of antitrust immunity so

that “members of the alliance [could] incorporate sales and distribution

cooperation into the agreements to allow the applicants to pursue the full

range of efficiencies possible under the venture, which would enhance the

overall consumer benefits of the alliance” (Id .). Antitrust immunity

“enables the Joint Applicants to coordinate fares, services, and schedules

so that consumers are offered a broader array of choices within the alliance

than could be offered without immunity” (Id . at 10). The result – as the

Department noted – would be consumer benefits for passengers on both nonstop

and connecting services (Id .). The same is true here.

**1. The Metal Neutrality Created By The JBA Is Essential To**

**Facilitating An Integrated Transpacific one** world **Network**

Without metal neutrality, participants in an alliance operate for the

benefit of their own operations – not the overall alliance network. Thus

American and JAL today have an interest in carrying traffic across the

Pacific on their own metal, rather than utilizing their combined operations

to maximize consumer benefits. A joint venture eliminates this inefficiency

by creating metal neutrality – a commercial indifference as to the operating

carrier in an itinerary marketed by the alliance. Antitrust immunity is

essential to the formation of these joint ventures, as the Department has

recognized in prior cases (See , e.g. , Order 2009-7-10, p. 10).

# - 17 –

**PUBLIC VERSION** For example, American and JAL each operate a daily nonstop flight

between New York-JFK and Tokyo-Narita, and these flights depart within 30

minutes of each other. 4 

# Absent a joint venture, there would be no incentive

for either carrier to change its departure time (which is optimally set for

local passengers), as it would likely result in lower onboard revenue for

the carrier moving its flight even though it would generate more revenue for

the two carriers combined. Revenue sharing in a metal neutral joint venture

removes this inefficient disincentive, allowing the carriers to spread out

their operations, giving local passengers more flexibility in their

schedule, while providing enhanced connecting opportunities for flow

passengers.

**2. The Proposed Alliance Will Create Expanded And Enhanced**

**Route And Schedule Options**

With a closely integrated alliance, including the JBA, the Joint

Applicants will have greater opportunities to launch new service and enhance

their existing route and schedule options. New transpacific routes will be

possible, making **one** world more competitive with Star and SkyTeam. Existing

transpacific service can be optimized to provide more value to both local

and connecting passengers.

Competition in behind/beyond routes will be enhanced as well, as

**one** world’s integration will create new competition against the existing Star

and SkyTeam transpacific networks. Antitrust immunity will allow the Joint

Applicants to offer lower fares and an improved product to the more than 11

million annual passengers traveling between the U.S. and Asia, including

those flying between the over 15,000 new global airport pairs that will be

added to **one** world’s immunized network.

4 

# AA 167 departs New York at 1130, and arrives in Tokyo at 1535, while JL 5

departs New York at 1200 and arrives in Tokyo at 1620.

# - 18 –

**PUBLIC VERSION** When the Department approved the joint venture proposed in Star II , it

cited benefits to consumers through a “[s]ignificant reduction of double

marginalization . . . exerting downward pressure on fares and providing a

wider range of fares” (Order 2009-7-10, p. 15). For instance, Professor Jan

K. Brueckner analyzed the development of the United/Lufthansa alliance from

its initial non-immunized phase through the implementation of a joint

venture, and found that “pure alliance membership reduces price by 4%,

codesharing by a further 7%, and antitrust immunity by an additional 16%

over codesharing” (J.K. Brueckner, International Airfares in the Age of

Alliances: The Effects of Code-Sharing and Antitrust Immunity , Review of

Economics and Statistics 85, 105-118 (Feb. 2003)).

**a. New Transpacific Routes And Service**

Approval and antitrust immunity for the alliance agreements and the

JBA will strengthen the Joint Applicants’ ability to maintain and expand

their nonstop services on transpacific routes, particularly given the high

cost of providing international air service and an extremely challenging

economic environment in which industry losses routinely reach the billions.

Econometric and other empirical analyses of transatlantic alliances

suggests that the JBA will lead to increases in nonstop service,

particularly on hub-to-hub routes where more seats across the Pacific will

be needed to accommodate the larger volumes of connecting traffic generated

by the Joint Applicants’ expanded network (See R. Bennett et al

.,

International Airline Alliance Development (July 2009), pp. 40-41). There

is abundant evidence that “following previous ATI approvals, alliances added

or expanded non-stop service between [their] U.S. and European hubs” (C.

Shapiro & T. Sullivan, Airline Antitrust Immunity , DOT-OST-2004-19214,

7/6/05, p. 13).

# - 19 –

**PUBLIC VERSION** For example, the United/Lufthansa immunized alliance doubled the

number of U.S.-Germany nonstop routes and frequencies that they operated

between 1996 (when the carriers were granted immunity) and 2008, including

additional frequencies on the Chicago/Washington-Frankfurt hub-to-hub

routes, and new services at secondary U.S. and German gateways (such as

Boston-Munich and Seattle-Frankfurt). The carriers’ rate of capacity

increase far exceeded the growth in local O&D passengers on U.S.-Germany

nonstop routes – this is necessary because the alliance sets capacity levels

to accommodate the increased volume of flow traffic being attracted by the

improved network.

This impact can also be seen on the difference in capacity growth

within the Delta/Air France alliance on routes that were included and

carved-out from antitrust immunity. On routes without a carve-out, seat

capacity increased between 17% and 26%, depending on the measurement. In

contrast, on carve-out routes, capacity changed between -12.4% and 1.6%

(Joint Applicants Answer to DOJ Comments, DOT-OST-2008-0252, 1/11/10,

Exhibit 3, p. 3).

Likewise, as American and its European **one** world partners pointed out

in DOT-OST-2008-0252:

“Northwest (now Delta) and KLM operate twice as many

daily flights and seats between Amsterdam and Detroit

as American and Iberia operate between Miami and

Madrid despite the fact that the DTW-AMS local market

is one-third the size of MIA-MAD. This is because the

highly integrated Northwest/KLM alliance requires

capacity on this route to accommodate flow traffic,

leading to increased capacity despite the fact that

the carriers face no nonstop competition on the route”

(Supplemental Comments, 9/8/09, p. 5).

In short, the proposed alliance will facilitate more transpacific flights

for **one** world customers – creating benefits for both local and connecting

passengers.

# - 20 –

**PUBLIC VERSION b. New Behind/Beyond Connectivity** 

The proposed alliance will also create better behind/beyond

connectivity with an integrated American/JAL network. These new and

improved connections will allow **one** world to be more competitive with Star

and SkyTeam on transpacific routes, as well as for global corporate

accounts.

**i. New And Improved Connections**

By approving and granting antitrust immunity for the proposed

alliance, the Department will enable American and JAL to significantly

expand their individual networks by implementing the metal-neutral JBA joint

venture. JAL’s network will add 65 unique points to American’s Asia network

(which is currently limited to just Tokyo and Shanghai), while American will

add 232 unique points to JAL’s network in North and South America. In

total, this will create 15,080 new integrated airport-pairs.

**ii. Competition With Star/SkyTeam**

An improved network is critically important for **one** world to be able to

compete with Star and SkyTeam in the transpacific market. Today, Star and

SkyTeam have integrated hub operations at Narita (United and Delta) and

Seoul (United/Asiana and Delta/Korean). **one** world has neither. American

currently serves just two cities in Asia – Tokyo and Shanghai (with Beijing

service scheduled to begin later this year), while JAL serves nine cities in

North and South America. By expanding and integrating the American/JAL

network, consumers will for the first time enjoy the benefits of three

competing networks – resulting in improved service and lower fares.

# - 21 –

**PUBLIC VERSION 3. Corporate Accounts** 

The impact of **one** world’s lack of network integration is clearly seen

in the disparity between its corporate contracts and those offered by Star

and SkyTeam. Over the years, global corporate customers (comprised entirely

of time-sensitive business travelers) have moved away from dealing with

individual airlines and toward alliance contracts. These corporate

customers – which can represent nearly a quarter of a network airline’s

revenue – employ corporate travel managers to oversee their multi-million

dollar budgets. Corporate travel managers are extremely sophisticated and

understand the importance of alliances and the depth of their integration.

In fact, some corporations are now requiring alliance bids to be from an

immunized grouping – virtually taking **one** world out of the picture.

**one** world’s current inability to provide a fully integrated alliance bid is

harmful both to consumers and to the Joint Applicants.

To be competitive when a corporate customer requests a bid, an

alliance must be prepared to offer three things – simplicity, discounts and

access to a global network. Even those corporate customers receptive to a

non-immunized **one** world bid provide constant feedback that Star and SkyTeam

are able to use their antitrust immunity to offer superior, fully integrated

discount programs. In contrast, the **one** world product has been little more

than stapling individual carrier contracts together in an alliance wrapper.

Such a product cannot effectively compete in the marketplace, and despite

vigorous efforts between **one** world’s commercial and legal teams to find a

solution, the lack of antitrust immunity has resulted in little or no

progress being made.

# - 22 –

**PUBLIC VERSION** Revenue sharing under the JBA will also create the commercial

incentives necessary to promote and sell integrated alliance products. In a

non-immunized environment, one airline has no reason to offer an “alliance”

incentive to the customer because that would increase its own cost of sale

without a corresponding increase in revenue. The JBA will allow **one** world to

offer a much more attractive corporate product for transpacific and global

accounts.

**4. Combinable Fares**

The JBA will also benefit consumers through fare combinability – the

ability to put itineraries together using one carrier for the outbound

transpacific segment and another carrier for the return. Commercial and

legal realities prevent airlines from creating combinable fares absent metal

neutrality. While **one** world has been able to test limited fare combinability

in smaller non-home countries (e.g. , Italy, where no **one** world carrier is

based), diversion and disruption of yield management have prevented the

alliance from moving forward with this program on a larger scale. Absent

fare combinability, the only way for a customer to enjoy the benefits of

cheaper round trip fares is to select a single-metal online itinerary –

limiting the number of frequencies available. If the customer wants the

benefit of a combined schedule, one-way fares must be used – resulting in a

far higher overall price. One customer reported to American that he “would

fly AA in a heartbeat” if **one** world had combinable fares. In short, fare

combinability gives the customer the best of both worlds – access to the

alliance with a combined schedule and discounted fares. 5

5 

# This is one of many reasons why a number of studies have concluded that

truly integrated antitrust immunized alliances deliver lower fares than

codesharing arrangements alone (See, e.g., Jan K. Brueckner and W. Tom

Whalen, The Price Effects of International Airline Alliances , Journal of Law

& Economics, 43 (2) (2000), pp. 503-545).

# - 23 –

**PUBLIC VERSION** These benefits, however, cannot be delivered without metal neutrality.

Yield management of round trip fares requires a carrier to take expected

load factors on both segments into consideration. 6 

# Absent an exchange of

yield management information, it would be difficult to ensure balance in

city-pairs where both carriers have a significant presence. The regular

exchange of yield management information between airlines would present a

significant risk of litigation given the competitive sensitivity of that

data. As a result, despite the pro-competitive benefits of fare

combinability, a non-immunized alliance faces extreme difficulties in

overcoming the legal and commercial disincentives.

**5. Joint Procurement**

**one** world’s joint procurement efforts have – to date – been hampered by

concerns about potential antitrust litigation, even though the carriers

believe the activity would be pro-competitive in nature. With antitrust

immunity, the Joint Applicants will be able to fully coordinate their joint

purchasing in an effort to reduce costs – something made even more critical

with jet fuel at unprecedented levels. These activities may include

obtaining volume discounts, common specifications for goods and services,

joint bidding and negotiations with suppliers, and the use of standardized

contracts for acquiring goods and services. Costs can be reduced across a

wide range of products and services, such as maintenance, field station

support, catering services, aircraft and ground equipment acquisition and

sales, distribution channels, fuel and information technology.

6 

# For example, a carrier may hold open low-value inventory on a relatively

full flight if it is linked to the sale of a return flight expected to

depart with a large number of empty seats.

# - 24 –

**PUBLIC VERSION** Additionally, the ability to unify sales forces is an often-cited

benefit of the Northwest/KLM joint venture (See , e.g. , Jay Boehmer, Air

France, Delta Join Up: Carriers To Share Transatlantic Sales Strategy, Route

Expansion Plans And Bottom Line , BTNonline, 10/22/07). The JBA will allow

American and JAL to do the same – with each carrier focusing its sales

efforts in a single region. Not only will this reduce costs, it will

strengthen the metal neutrality associated with the joint venture, as

competing goals will be replaced by a common economic interest.

**III. U.S.-JAPAN OPEN SKIES WILL ENSURE THAT THE PROPOSED ALLIANCE WILL NOT**

**SIGNIFICANTLY REDUCE COMPETITION**

The proposed alliance will create public benefits of all kinds –

expanded networks, improved itineraries and more integrated product

offerings; moreover, it will not significantly reduce competition in any

relevant market. The proposed alliance will improve global and transpacific

network competition by allowing **one** world to compete with Star and SkyTeam on

a comparable regulatory and commercial footing. At the same time, the

enhanced competitive conditions resulting from the landmark U.S.-Japan Open

Skies Agreement will prevent the Joint Applicants from exercising market

power on any overlapping transpacific route. Accordingly, the alliance

agreements meet the Department’s standard for approval and antitrust

immunity.

# - 25 –

**PUBLIC VERSION A. The Proposed Alliance Will Enhance Global And Transpacific** 

**Network Competition By Facilitating U.S.-Japan Open Skies**

The proposed alliance will allow **one** world to become a third immunized

alliance capable of competing effectively with Star and SkyTeam.

Interalliance competition is extremely important, with more than 80% of the

world’s 60 largest airlines being members of a globally branded alliance.

Thus, approval of the proposed alliance will create – not reduce –

competition in both the global and transpacific marketplace. The successful

creation of strong interalliance competition across the Pacific – a direct

result of the Department’s Open Skies Policy – could well lead to a

deregulation of aviation markets elsewhere, particularly in Asia.

**B. The Proposed Alliance Will Not Significantly Reduce Competition**

**In Any Global, Regional Or Country-Pair Market**

**1. Global And Transpacific Interalliance Competition**

**a. Global**

The addition of a transpacific joint venture to **one** world’s network is

essential to expand consumer choice and enhance competition in the global

marketplace – something U.S.-Japan Open Skies is necessary to achieve.

Today, SkyTeam has a significant network advantage in Asia, as the

Delta/Northwest merger has given it two integrated hub networks – one over

Narita with Northwest’s Pacific Franchise, and the other over Seoul with the

Delta/Korean Air immunized alliance. Star stands poised to compete with

SkyTeam with its combination of the existing immunized United/Asiana

alliance at Seoul and proposed United/Continental/ANA alliance at Narita.

The proposed alliance will give **one** world a competing Narita hub – critical

to the sustainability of three competing global networks.

# - 26 –

**PUBLIC VERSION** Antitrust immunity will give consumers more travel options, shorter

travel times and reduced fares and will likely accelerate the introduction

of new capacity on transpacific routes. Specifically, approval of this

Joint Application will add 65 new points to the integrated **one** world network

in Asia, as well as 232 new points in North/South America for integrated

transpacific service. Together, the Joint Applicants will account for an

extremely small percentage of the global network market, and **one** world as a

whole is the smallest of the three global alliances.

**b. Transpacific**

A large number of carriers compete on U.S.-Asia routes across the

Pacific, with no single carrier or alliance enjoying a dominant share.

Approval of this Joint Application will not substantially lessen that

competition. More than 20 international carriers – including the four

largest U.S. network airlines – operate scheduled nonstop passenger service

between 17 points in the U.S. and 19 points in Asia. These services are

supported by codeshare agreements creating online itineraries in thousands

of behind- and beyond-gateway O&D city pairs. After approval of this Joint

Application, 97% of U.S.-Asia O&Ds and 99% of U.S.-Asia passengers will

continue to enjoy the benefits of at least three competing options and/or

will experience no change in the number of competitive offerings.

# - 27 –

**PUBLIC VERSION** In fact, the proposed alliance will link the 3rd and 11th largest

carriers (measured by capacity) in the U.S.-Asia market, or the 9th and 10th

largest carriers (measured by U.S. point-of-origin bookings) (See Joint

Application, DOT-OST-2009-0350, 12/23/09, Exhibit JA-8, p. 2). Thus the

transpacific market is not concentrated, and the combination of smaller

competitors like American and JAL will only serve to improve network

competition. Together, the Joint Applicants will account for just 22.4% of

the transpacific network market (just 9.8% of U.S. point-of-origin traffic)

(Joint Application, DOT-OST-2009-0350, 12/23/09, Exhibit JA-8, p. 2), well

within the Department’s precedents in prior immunity cases.

**2. U.S.-Japan Competition**

Competition among individual airlines and alliances for U.S-Japan

services is intense. Between the U.S. and Japan, Delta/Korean is the

largest competitor measured by capacity, with 31% of seats in the market.

The proposed United/Continental/ANA alliance will account for 31% of U.S.-

Japan seats as well. Today, JAL accounts for 24.6% of U.S.-Japan seats,

while American operates 8.8%, which means the proposed alliance will bring

**one** world into competitive parity with Star and SkyTeam with 33%.

On a booking level, the proposed alliance will also create competitive

parity. Today, American carries just 6.3% of U.S.-Japan passengers – far

less than Delta (26.0%) or United (14.7%). With the proposed alliance (and

United/Continental/ANA), **one** world will account for 38.0% of U.S.-Japan

bookings, followed by SkyTeam 29.9% and Star 28.0%. That level of

competitive choice is unmatched in any other country-pair. Thus the

proposed alliance will not harm competition between the U.S. and Japan, and

is well within the Department’s precedent in prior immunity cases (See

,

e.g. , Order 2009-4-5, pp. 8-10).

# - 28 –

**PUBLIC VERSION C. City-Pair Competition** 

Individual city-pair competition between the U.S. and Japan will also

remain robust with the immunized American/JAL alliance. The Joint

Applicants operate overlapping nonstop service in just three city-pairs:

New York-Tokyo, Los Angeles-Tokyo and Chicago-Tokyo. Each of these citypairs will continue to have competing service among Star, SkyTeam and

**one** world, making this proposed alliance uniquely pro-competitive.

**1. New York-Tokyo**

New York-Tokyo accounts for approximately 465 bookings per day each

way, and five carriers operate daily nonstop service with Boeing 777

aircraft: American, JAL (9 weekly), ANA, Continental and Delta. After the

Department grants immunity to **one** world and Star, there will still be three

independent competitors and vibrant competition on the route. Star will

account for 46.3% of all bookings, while **one** world will account for 45.0%.

Delta and other airlines accounted for nearly 10% even before Delta relaunched its service in mid-2009. 7



# This competitive overlap is well within the Department’s precedent.

The Department has granted antitrust immunity on many city-pairs with three

nonstop post-transaction competitors (Order 2009-7-10, DOT-OST-2008-0234, p.

18, holding that “we will not impose carve outs in markets that only shift

from four to three, or from three to two, nonstop competitors, as we are not

convinced that these pose a risk of substantial reduction in competition”),

and 45.0% is far below the numbers in prior proceedings (See , e.g. , Order

2009-4-5, pp. 12-13). There is no potential for harm to competition in this

city-pair.

7 

# Since June 2009, Delta’s share has increased significantly as a result of

re-launching nonstop service.

# - 29 –

**PUBLIC VERSION 2. Los Angeles-Tokyo** 

Los Angeles-Tokyo accounts for approximately 595 bookings per day each

way, and six carriers operate daily nonstop service: American (Boeing 777),

JAL (Boeing 777), ANA (Boeing 777), Delta (Boeing 747), Korean (Boeing 777)

and Singapore (Boeing 747). After the Department grants immunity to

**one** world and Star, there will still be four independent competitors and

vibrant competition on the route. SkyTeam will account for 34.2% of all

bookings on the route, Star (except Singapore Airlines, which does not have

antitrust immunity) will account for 24.1%, Singapore 20.4% and **one** world

20.3%. Other airlines will account for approximately 1.0%.

This competitive overlap is well within the Department’s precedents.

The Department has granted antitrust immunity on many city-pairs with four

nonstop post-transaction competitors (Order 2009-7-10, DOT-OST-2008-0234, p.

18, and **one** world’s 23.0% share is the smallest of the four major

competitors.

**3. Chicago-Tokyo**

Chicago-Tokyo accounts for approximately 122 bookings per day each

way, and is a route served nonstop primarily to accommodate flow traffic.

Four carriers operate daily nonstop service: American (Boeing 777), JAL

(Boeing 777), ANA (Boeing 777) and United (Boeing 747). After the

Department grants immunity to **one** world and Star, there will still be two

independent competitors and vibrant competition on the route. Star will

account for 49.7% of all bookings, while **one** world will account for 44.2%.

Delta and other airlines will account for approximately 6.1%.

# - 30 –

**PUBLIC VERSION** Moreover, for both Star and **one** world, Chicago-Tokyo is a hub-to-hub

route. As discussed in Part II.B.2.a, above, immunized alliance partners

have a strong incentive to add capacity on such hub-to-hub routes, and they

have done so in the past. Capacity increases yield numerous benefits for

passengers, including more travel options and lower fares. Chicago-Tokyo is

a thin local market to begin with, and convenient one-stop options are

offered by Delta via Minneapolis/St. Paul, Detroit, Seattle, Portland and

San Francisco. This competitive overlap is well within the Department’s

precedents. The Department has granted antitrust immunity on many citypairs with two nonstop post-transaction competitors (Order 2009-7-10, DOTOST-2008-0234, p. 18, and 44.2% is far below the numbers in some prior

proceedings (See , e.g. , Order 2009-4-5, pp. 12-13). There is no potential

for harm to competition in this city-pair.

**IV. THE JOINT APPLICANTS WILL NOT PROCEED WITH THE PROPOSED ALLIANCE**

**ABSENT ANTITRUST IMMUNITY**

Immunizing the proposed alliance is the only way to enable the Joint

Applicants to compete on equal footing with Star and SkyTeam. Greater

integration between American and JAL through the JBA will create vibrant

interalliance competition, as **one** world will be able to deliver significant

service and fare improvements to customers. Because the full network

benefits of the proposed alliance cannot be realized absent a grant of

antitrust immunity, withholding approval would essentially preclude

**one** world’s chances for long-term success in the alliance marketplace. The

biggest losers would be the customers who seek interalliance competition,

but only have two choices – Star and SkyTeam – at present.

# - 31 –

**PUBLIC VERSION** The JBA cannot be implemented in the absence of antitrust immunity.

Although American and JAL have already agreed to the most important

components of the relationship, such as governance, geographic scope, and

the process for determining how revenues are pooled and shared, their

negotiations cannot be completed without an exchange of confidential and

highly sensitive transpacific segment information and competitive data. Such

an exchange prior to a grant of antitrust immunity would not only carry some

risk under the antitrust laws, but would also create a significant

commercial risk if there is any doubt as to whether the Department will

approve the transaction. Accordingly, the Joint Applicants urge the

Department to approve this application and immunize the proposed alliance

agreements so that the parties can finalize and implement their joint

venture and consumers can enjoy the benefits of integration.

**V. OTHER APPROVAL ISSUES, CONDITIONS AND INFORMATION**

The Joint Applicants are providing the following additional

information typically furnished to the Department for the purpose of

analyzing applications for antitrust immunity

**A. Document Production And Responses To Interrogatories.**

The Joint Applicants will submit separately, under a joint motion for

confidential treatment, documents responsive to the criteria used in

previous antitrust immunity dockets, including the U.S.-U.K. Alliance Case

(DOT-OST-2001-11029), SkyTeam (DOT-OST-2004-19214, Star (DOT-OST-2005-

22922), SkyTeam II (DOT-OST-2007-28644), Star II (DOT-OST-2008-0234) and

**one** world (DOT-OST-2008-0252) (Exhibit JA-28). In addition, the Joint

Applicants are providing written responses to interrogatories similar to

those issued by the Department in previous antitrust immunity proceedings.

# - 32 –

**PUBLIC VERSION B. Transpacific Routes** 

The transpacific routes flown by the Joint Applicants are identified

in Exhibit JA-8. The Joint Applicants anticipate that they will continue

serving these routes after the alliance agreements are approved, and they do

not have plans to change their services that are contingent on approval

being obtained. The carriers will continue to adjust their schedules

depending on market conditions and competitive opportunities.

**C. Transpacific Carriers Within The Three Alliances**

Star has four transpacific members, including United and ANA (each of

which operates a Narita hub) and Continental (which operates a hub in Guam),

and Asiana (which has antitrust immunity with United and operates a hub in

Seoul). SkyTeam has three transpacific members, including Delta (which

operates a hub at Narita) and Korean Airlines (which has antitrust immunity

with Delta and also operates a hub in Seoul). **one** world has three

transpacific members, but no integrated transpacific alliance network.

**D. Codeshare Agreements**

The current codeshare agreements between each of the Joint Applicants

and non- **one** world carriers are listed in Exhibit JA-9.

**E. Relationship To one** world

The proposed American/JAL alliance includes two of **one** world’s transpacific members and will primarily affect transpacific markets. Although

the American/JAL alliance will be an integral part of **one** world, it will not

significantly influence operations of other **one** world members that do not

operate competing transpacific service to Japan. **one** world will therefore be

well positioned to coordinate and optimize U.S.-Japan service to the benefit

of its member carriers and their passengers.

# - 33 –

**PUBLIC VERSION one**  world’s membership currently includes American, British Airways,

Cathay Pacific, Finnair, Iberia, Japan Airlines, LAN, Malev, Mexicana,

Qantas, and Royal Jordanian. American has separate antitrust immunity with

Finnair (DOT-OST-2002-12063) and with LAN/LAN Peru (DOT-OST-2004-19964), and

is seeking joint antitrust immunity with British Airways, Iberia, Finnair,

and Royal Jordanian in DOT-OST-2008-0252.

It is possible that as the JBA expands in geographic scope, other

**one** world carriers could be included in a future application. In the case of

the LAN carriers, this would become much easier if the United States were

able to reach Open Skies agreements with Argentina and Ecuador, allowing

American to seek antitrust immunity with all four LAN affiliates. It is

also possible that American and JAL could seek to include Qantas in a future

application, as the U.S. and Australia now have an Open Skies agreement.

Inclusion of Cathay Pacific will not be possible until the U.S.-Hong

Kong market is fully liberalized. However, this will not create tension

within the JBA, as American does not operate service to Hong Kong, and thus

will not have competing traffic flows to Asia over a non-JBA gateway.

Likewise, inclusion of Mexicana is not presently possible; the U.S.-Mexico

air transport agreement, although not highly restrictive, is not Open Skies,

and thus prevents Mexicana from joining the immunized alliance at this time.

**F. Hub Airports**

American operates hubs at Dallas/Fort Worth, Chicago O’Hare and Miami.

JAL operates hubs at Narita and Haneda.

# - 34 –

**PUBLIC VERSION G. Significant Service And Equipment Changes** 

The Joint Applicants have not finalized any schedule changes to be

made after the proposed alliance is approved and implemented. The Joint

Applicants may adjust their schedules in the future depending on market

conditions and opportunities presented by the competitive environment

**H. Competitive Access To Non-U.S. Gateway Airports**

Competitive access to the Joint Applicants’ non-U.S. gateway airports

will be addressed in response to the standard interrogatories in a separate

submission.

**I. Impact On Revenue**

The proposed alliance is an integral element of each carrier’s global

network ambitions. The carriers anticipate that the development and

expansion of their alliance will generate additional traffic and revenue,

enhance operating efficiencies, and have a positive impact on system

profitability.

**J. U.S. Labor Issues**

American believes that the transaction raises no significant labor

issues. American and JAL will remain independent. No significant impact on

unionized employees is anticipated under the alliance and coordination

agreements. The applicants believe that the long-term impact of the

transaction will be positive for all existing employees for new job

creation.

**K. Computer Reservations Systems**

Consistent with Department precedent, the Joint Applicants request

that the grant of antitrust immunity encompass the presentation and sale of

their services in computer reservations systems and the operation of their

internal reservations systems.

# - 35 –

**PUBLIC VERSION L. Civil Reserve Air Fleet** 

The alliance agreements between American and JAL will have no impact

on American’s CRAF commitments.

**M. CRS Booking Data**

This data will be provided in response to the standard document

requests.

**N. Resubmission Of Alliance Agreements**

The Joint Applicants will accept the Department’s general condition

requiring the carriers “to resubmit for review their Alliance Agreements

five years from the data of issuance of the final order” (Order 2002-11-12,

p. 18).

**O. Conditions**

The Joint Applicants will accept the Department’s standard conditions

attached to previous grants of antitrust immunity relating to: (1) nonparticipation in certain IATA price-related tariff coordination activities;

(2) O&D Survey data reporting requirements; (3) operation under a common

name or brand; and (4) the submission of any subsequent subsidiary

agreements implementing the Alliance Agreements. With respect to the JBA,

the Joint Applicants will accept the conditions that the Department attached

to its final order granting antitrust immunity to the expanded SkyTeam

alliance requiring implementation within 18 months (Order 2008-5-32, pp. 4-

6, App. A). Those conditions required: (1) submission of evidence that the

JBA has been implemented within 18 months; and (2) submission of a status

report within 12 months if the prior condition has not already been met.

# - 36 –

**PUBLIC VERSION CONCLUSION** 

Joint Applicants have presented the Department with one of the most

pro-competitive proposed alliances in the history of antitrust immunity

proceedings. Approval of the Joint Application will facilitate the

implementation of a new U.S.-Japan Open Skies agreement, will link two

complimentary networks and give **one** world its first truly integrated

transpacific hub network to compete with Star and SkyTeam, and involves

overlaps on just three city-pairs accounting for less than a million

bookings per year where there will be no less than two nonstop posttransaction competitors on each route. Accordingly, the Joint Applicants

ask that the Department move promptly to approve the proposed alliance and

grant immunity under 49 U.S.C. §§ 41308 and 41309.

Respectfully submitted,

CARL B. NELSON, JR. WILLIAM KARAS

Associate General Counsel CAROL GOSAIN

R. BRUCE WARK Steptoe & Johnson LLP

Associate General Counsel Attorneys for Japan Airlines

JEFFREY A. OGAR

Senior Attorney

American Airlines, Inc.

February 12, 2010

# INDEX OF JOINT EXHIBITS

JA-1 Alliance Agreement

JA-2 Joint Business Agreement

JA-3 Linking JAL’s Unique Asia Airports With Unique

U.S. Airports Served by American Will Add 9,752

Immunized U.S.-Asia Airport Pairs

JA-4 The American/JAL Immunized Alliance Will Add 65 New Asia

Airports To The Immunized Global Network

JA-5 The Scope Of The Proposed Joint Venture Will Cover

15,745 Transpacific Airport-Pairs And Approximately 17.1

Million Annual Passengers

JA-6 A Grant Of ATI To The American/JAL Alliance Will Not

Reduce The Intense Competition In The U.S.-Asia Market

JA-7 Passengers Traveling On American/Japan Airlines

Nonstop Overlaps Will Continue To Benefit From

Significant Nonstop (And Other) Competition

JA-8 Joint Applicants’ U.S. To International Routes

JA-9 Joint Applicants’ International Codeshare Partners

JA-10 Carriers Operating Scheduled International Services

At American’s Hubs And Gateway Cities

JA-11 Joint Applicants’ U.S. To Asia Nonstop Routes

# EXHIBIT JA-1

**AMERICAN/JAPAN AIRLINES**

**ALLIANCE AGREEMENT**

# EXHIBIT JA-2

**AMERICAN/JAPAN AIRLINES**

**JOINT BUSINESS AGREEMENT**

**Confidential Treatment Requested**

**Under 14 CFR 302.12**Exhibit JA-3Page 1 of 8Linking JAL’s Unique Asia Airports With Unique U.S. Airports Served By AmericanWill Add 9,750 New Immunized U.S. – Asia Airport PairsAAU iU SU iJALNewImmunizedAAUniqueU.S.AirportsUniqueJALAsiaAirportsNewImmunizedU.S.‐AsiaAirportPairs150 X 65 = 9,750•The 150 Unique AA U.S. Airports Account For A CombinedTotal of More Than 5 2 Million Passengers To/From Asia AnnuallyTotalofMoreThan5.2MillionPassengersTo/FromAsiaAnnually•JL’s 65 Unique Asia Airports Account For A Combined TotalOf Approximately 11.7 Million Passengers To/From The U.S. AnnuallySOURCE: OAG, December 2009; MIDT, Year 2009Exhibit JA-3Page 2 of 8Linking JAL’Unique Asia Airports With Unique International AirportsLinkingJAL sUniqueAsiaAirportsWithUniqueInternationalAirportsServed By American Will Add 15,080 New Global Immunized Airport PairsAAUniqueU.S.andUniqueJALNewImmunizedU S‐InternationalInternationalAirportsAsiaAirportsU.S.‐InternationalAirport Pairs150X6515 080+82X65=15,080•The 150 Unique AA U.S. Airports Account For A CombinedTotal of More Than 5.2 Million Passengers To/From Asia AnnuallyTh 82 AA U i I t ti l Ai t A t F A•The82AAUniqueInternationalAirportsAccountForACombined Total Of 3.8 Million Passengers To/From Asia Annually•JL’s 65 Unique Asia Airports Account For A Combined TotalOf A i t l 11 7 Milli P T /F Th U S A llSOURCE: OAG, December 2009; MIDT, Year 2009OfApproximately11.7MillionPassengersTo/FromTheU.S.AnnuallyExhibit JA-3Page 3 of 8Linking JAL’s Unique Asia Airports With Unique U.S. Airports ServedB A i Will Add 9 750 N I i d U SA i Ai t P iByAmericanWillAdd9,750NewImmunizedU.S. –AsiaAirportPairsInternationalAirportsInAsiaAtWhichJAL(ButNotAmerican)Operates# Name AirportCode Country # Name AirportCode Country1 AkitaJapan AXT Japan 34 MiyazakiJapan KMI Japan2 AmamiOShimaJapan ASJ Japan 35 NagasakiJapan NGS Japan( l)3 AomoriJapan AOJ Japan 36 NagoyaIntJapan NGO Japan4 AsahikawaJapan AKJ Japan 37 Nagoya(Komaki)Japan NKM Japan5 Bangkok(Intl)Thailand BKK Thailand 38 NankiShirahamaJapan SHM Japan6 Beijing(Capital)China PEK China 39 NiigataJapan KIJ Japan7 BusanRep.ofKorea PUS RepublicofKorea 40 ObihiroJapan OBO Japan8 DalianChina DLC China 41 OitaJapan OIT Japan9 FukuokaJapan FUK Japan 42 OkayamaJapan OKJ Japan10 GuangzhouChina CAN China 43 OkinawaJapan OKA Japan11 HakodateJapan HKD Japan 44 Osaka(Itami)Japan ITM Japan12 HanamakiJapan HNA Japan 45 Osaka(KansaiIntl)Japan KIX Japan13 HangzhouChina HGH China 46 Osaka(Kobe)Japan UKB Japan14 HanoiVietnam HAN Vietnam 47 QingdaoChina TAO China15 Hiroshima(Intl)Japan HIJ Japan 48 Sapporo(Chitose)Japan CTS Japan16HoMinhCityVietnamSGNVietnam49SendaiJapanSDJJapanChiVietnamVietnam17 HongKong(Intl)China HKG China 50 Seoul(GimpoIntl)Rep.ofKorea GMP RepublicofKorea18 Ishigaki Japan ISG Japan 51 Seoul(IncheonIntl)Rep.ofKorea ICN RepublicofKorea19 IzumoJapan IZO Japan 52 Shanghai(HongqiaoIntl)China SHA China20 KagoshimaJapan KOJ Japan 53 Shanghai(PuDongIntl)China PVG China21 KaohsiungChineseTaipei KHH ChineseTaipei 54 ShizuokaJapan FSZ Japan22 KitaKyushuJapan KKJ Japan 55 Singapore(Changi) SIN Singapore23 KochiJapan KCZ Japan 56 Taipei(TaoyuanIntl)ChineseTaipei TPE ChineseTaipei24 KomatsuJapan KMQ Japan 57 TakamatsuJapan TAK Japan25 KualaLumpur(Intl)Malaysia KUL Malaysia 58 TianjinChina TSN China26 KumamotoJapan KMJ Japan 59 TokunoshimaJapan TKN Japan27 KumeJimaJapan UEO Japan 60 TokushimaJapan TKS Japan28 KushiroJapan KUH Japan 61 Tokyo(Haneda)Japan HND Japan29 ManilaPhilippines MNL Philippines 62 UbeJapan UBJ JapanSOURCE: OAG, December 2009pppppp30 MatsuyamaShikokuJapan MYJ Japan 63 XiamenChina XMN China31 MemanbetsuJapan MMB Japan 64 YamagataJapan GAJ Japan32 MisawaJapan MSJ Japan 65 YonaguniJimaJapan OGN Japan33 MiyakoJimaJapan MMY JapanExhibit JA-3Page 4 of 8Linking JAL’Unique Asia Airports With Unique U.S. Airports ServedLinkingJAL sUniqueAsiaAirportsWithUniqueU.S.AirportsServedBy American Will Add 9,750 New Immunized U.S. – Asia Airport PairsU.S.AirportsAtWhichAmerican(ButNotJAL)Operates# Name AirportCode State # Name AirportCode State1 AbileneTXUSA ABI Texas(TX)USA 26 Columbus(Intl)OHUSA CMH Ohio(OH)USA2 AlbuquerqueNMUSA ABQ NewMexico(NM)USA 27 CorpusChristiTXUSA CRP Texas(TX)USA3 Alexandria(Intl)LAUSA AEX Louisiana(LA)USA 28 Dallas/Ft.Worth(Intl)TXUSA DFW Texas(TX)USA4 AmarilloTXUSA AMA Texas(TX)USA 29 Dayton(Intl)OHUSA DAY Ohio(OH)USA5 Atlanta(Intl)GAUSA ATL Georgia(GA)USA 30 Denver(Intl)COUSA DEN Colorado(CO)USA6 Austin(BergstromIntl)TXUSA AUS Texas(TX)USA 31 DesMoinesIAUSA DSM Iowa(IA)USA7 Baltimore(Intl)MDUSA BWI Maryland(MD)USA 32 Detroit(MetroWayne)MIUSA DTW Michigan(MI)USA8 BatonRougeLAUSA BTR Louisiana(LA)USA 33 DubuqueIAUSA DBQ Iowa(IA)USA9 BirminghamALUSA BHM Alabama(AL)USA 34 ElPasoTXUSA ELP Texas(TX)USA10 BloomingtonILUSA BMI Illinois(IL)USA 35 EvansvilleINUSA EVV Indiana(IN)USA11Boston(Intl)BOSMassachussetts(MA)USA36Fayetteville(Regional)XNAArkansas(AR)USABoston(Intl)MAUSAMassachussettsFayetteville(Regional)ARUSAArkansas12 BrownsvilleTXUSA BRO Texas(TX)USA 37 FlintMIUSA FNT Michigan(MI)USA13 Buffalo(Intl)NYUSA BUF NewYork(NY)USA 38 Fresno(YosemiteIntl)CAUSA FAT California(CA)USA14 BurbankCAUSA BUR California(CA)USA 39 Ft.Lauderdale(Intl)FLUSA FLL Florida(FL)USA15 CedarRapids/IowaCityIAUSA CID Iowa(IA)USA 40 Ft.Myers(SouthwestFlIntl)FLUSA RSW Florida(FL)USA16 ChampaignILUSA CMI Illinois(IL)USA 41 Ft.SmithARUSA FSM Arkansas(AR)USA17 CharlestonSCUSA CHS SouthCarolina(SC)USA 42 Ft.WaltonBeachFLUSA VPS Florida(FL)USA18 CharlestonWVUSA CRW WestVirginia(WV)USA 43 Ft.WayneINUSA FWA Indiana(IN)USA19 CharlotteNCUSA CLT NorthCarolina(NC)USA 44 GrandJunctionCOUSA GJT Colorado(CO)USA20 ChattanoogaTNUSA CHA Tennessee(TN)USA 45 GrandRapidsMIUSA GRR Michigan(MI)USA21 Cincinnati(Intl)OHUSA CVG Ohio(OH)USA 46 GreenBayWIUSA GRB Wisconsin(WI)USA22 Cleveland(Intl)OHUSA CLE Ohio(OH)USA 47 Greensboro/H.Pt/Win‐SalemNCUSA GSO NorthCarolina(NC)USASOURCE: OAG, December 200923 CollegeStationTXUSA CLL Texas(TX)USA 48 Greenville/SpartanburgSCUSA GSP SouthCarolina(SC)USA24 ColoradoSpringsCOUSA COS Colorado(CO)USA 49 Gulfport/BiloxiMSUSA GPT Mississippi(MS)USA25 ColumbiaSCUSA CAE SouthCarolina(SC)USA 50 GunnisonCOUSA GUC Colorado(CO)USAExhibit JA-3Page 5 of 8Linking JAL’s Unique Asia Airports With Unique U.S. Airports ServedB A i Will Add 9 750 N I i d U SA i Ai t P iByAmericanWillAdd9,750NewImmunizedU.S. –AsiaAirportPairs#NameAirportCodeState#NameAirportCodeStateU.S.AirportsAtWhichAmerican(ButNotJAL)Operates#NameAirportCodeState#NameAirportCodeState51 Hartford(BradleyIntl)CTUSA BDL Connecticut(CT)USA 76 Lubbock(P.SmithIntl)TXUSA LBB Texas(TX)USA52 Houston(G.BushIntl)TXUSA IAH Texas(TX)USA 77 Madison(DaneCounty)WIUSA MSN Wisconsin(WI)USA53 Houston(Hobby)TXUSA HOU Texas(TX)USA 78 ManhattanKSUSA MHK Kansas(KS)USA54 Huntsville/DecaturALUSA HSV Alabama(AL)USA 79 MarquetteMIUSA MQT Michigan(MI)USA55 IndianapolisINUSA IND Indiana(IN)USA 80 McAllenTXUSA MFE Texas(TX)USA56 JacksonWYUSA JAC Wyoming(WY)USA 81 MemphisTNUSA MEM Tennessee(TN)USA57 Jackson‐Evers(Intl)MSUSA JAN Mississippi(MS)USA 82 Miami(Intl)FLUSA MIA Florida(FL)USA58 Jacksonville(Intl)FLUSA JAX Florida(FL)USA 83 Midland/OdessaTXUSA MAF Texas(TX)USA59 KahuluiMauiHIUSA OGG Hawaii(HI)USA 84 MilwaukeeWIUSA MKE Wisconsin(WI)USA60 KalamazooMIUSA AZO Michigan(MI)USA 85 Minneapolis/St.Paul(Intl)MNUSA MSP Minnesota(MN)USA61 KansasCity(Intl)MOUSA MCI Missouri(MO)USA 86 MobileALUSA MOB Alabama(AL)USA62 KeyWestFLUSA EYW Florida(FL)USA 87 MolineILUSA MLI Illinois(IL)USA63 KilleenGrayAAFTXUSA GRK Texas(TX)USA 88 MonroeLAUSA MLU Louisiana(LA)USA64 KnoxvilleTNUSA TYS Tennessee(TN)USA 89 MontereyCAUSA MRY California(CA)USA65 LaCrosseWIUSA LSE Wisconsin(WI)USA 90 MontgomeryALUSA MGM Alabama(AL)USA66 LafayetteLAUSA LFT Louisiana(LA)USA 91 MontroseCOUSA MTJ Colorado(CO)USA67 Lakhrl(Regional)LAA LCH LouiinLAA92 Nashvill(Intl)TNUSA BNA Tennessee(TNUSAeC a es( eg o a )USs a a( )US( t )essee)68 LaredoTXUSA LRD Texas(TX)USA 93 NewOrleans(Intl)LAUSA MSY Louisiana(LA)USA69 LasVegas(Intl)NVUSA LAS Nevada(NV)USA 94 NewYork(Laguardia)NYUSA LGA NewYork(NY)USA70 LawtonOKUSA LAW Oklahoma(OK)USA 95 Newark/NewYork(Liberty)NJUSA EWR NewJersey(NJ)USA71 LexingtonKYUSA LEX Kentucky(KY)USA 96 Norfolk/Va.Bch/WmbgVAUSA ORF Virginia(VA)USA72 LihueKauaiHIUSA LIH Hawaii(HI)USA 97 OklahomaCity(Rogers)OklahamaUSA OKC Oklahoma(OK)USASOURCE: OAG, December 200973 LittleRockARUSA LIT Arkansas(AR)USA 98 OmahaNEUSA OMA Nebraska(NE)USA74 LongviewTXUSA GGG Texas(TX)USA 99 Ontario(Intl)CAUSA ONT California(CA)USA75 LouisvilleKYUSA SDF Kentucky(KY)USA 100 Orlando(Intl)FLUSA MCO Florida(FL)USAExhibit JA-3Page 6 of 8Linking JAL’s Unique Asia Airports With Unique U.S. Airports ServedByAmerican Will Add 9,750 New Immunized U.S. –Asia Airport PairsU.S.AirportsAtWhichAmerican(ButNotJAL)Operates# Name AirportCode State # Name AirportCode State101 PalmSpringsCAUSA PSP California(CA)USA 126 ShreveportLAUSA SHV Louisiana(LA)USA102P lUSAPNSFl idUSA127S i fi ldILUSASPIIlli i(IL)USAensacolaFLora(FL)Springfieldnos103 PeoriaILUSA PIA Illinois(IL)USA 128 SpringfieldMOUSA SGF Missouri(MO)USA104 Philadelphia(Intl)PAUSA PHL Pennsylvania(PA)USA 129 SteamboatSpringsCOUSA HDN Colorado(CO)USA105 Phoenix(Intl)AZUSA PHX Arizona(AZ)USA 130 St.Croix(Intl)USVirginIslands STX VirginIslands(VI)USA106 Pittsburgh(Intl)PAUSA PIT Pennsylvania(PA)USA 131 St.Louis(Intl)MOUSA STL Missouri(MO)USA107 PortlandORUSA PDX Oregon(OR)USA 132 St.Thomas(Intl)USVirginIslands STT VirginIslands(VI)USA108 Raleigh/DurhamNCUSA RDU NorthCarolina(NC)USA 133 SyracuseNYUSA SYR NewYork(NY)USA109 RenoNVUSA RNO Nevada(NV)USA 134 TallahasseeFLUSA TLH Florida(FL)USA110 Richmond/WmbgVAUSA RIC Virginia(VA)USA 135 Tampa(Intl)FLUSA TPA Florida(FL)USA111 RochesterMNUSA RST Minnesota(MN)USA 136 TexarkanaARUSA TXK Arkansas(AR)USA112 RochesterNYUSA ROC NewYork(NY)USA 137 ToledoOHUSA TOL Ohio(OH)USA113 RoswellNMUSA ROW NewMexico(NM)USA 138 TraverseCityMIUSA TVC Michigan(MI)USA114 Sacramento(Metro)CAUSA SMF California(CA)USA 139 TucsonAZUSA TUS Arizona(AZ)USA115 SaltLakeCityUTUSA SLC Utah(UT)USA 140 TulsaOKUSA TUL Oklahoma(OK)USA116 SanAngeloTXUSA SJT Texas(TX)USA 141 TylerTXUSA TYR Texas(TX)USA117 SanAntonioTXUSA SAT Texas(TX)USA 142 Vail/EagleCOUSA EGE Colorado(CO)USA118 SanDiego(Intl)CAUSA SAN California(CA)USA 143 Waco(Municipal)TXUSA ACT Texas(TX)USA119SanJoseUSASJCCalifornia144Washington(Reagan'DCADistrictColumbiaCACalifornia(CA)USAWashington(ReaganNat l)DCUSADistrictofColumbia(DC)USA120 SanJuan(Intl)PuertoRico SJU PuertoRico(PR)USA 145 Washington(DullesIntl)DCUSA IAD DistrictofColumbia(DC)USA121 SantaAna(J.Wayne)CAUSA SNA California(CA)USA 146 Wausau(Central)WIUSA CWA Wisconsin(WI)USA122 SantaBarbaraCAUSA SBA California(CA)USA 147 WestPalmBeach(Intl)FLUSA PBI Florida(FL)USA123 SantaFeNMUSA SAF NewMexico(NM)USA 148 WestchesterCountyNYUSA HPN NewYork(NY)USA124 Savannah/HiltonHeadGAUSA SAV Georgia(GA)USA 149 WichitaFallsTXUSA SPS Texas(TX)USASOURCE: OAG , December 2009125 Seattle/Tacoma(Intl)WAUSA SEA Washington(WA)USA 150 WichitaKSUSA ICT Kansas(KS)USAExhibit JA-3Page 7 of 8Linking JAL’s Unique Asia Airports With Unique International AirportsServed By American Will Add 15 080 New Global Immunized Airport PairsServedByAmericanWillAdd15,080NewGlobalImmunizedAirportPairsInternationalAirportsAtWhichAmerican(ButNotJAL)Operates# Name AirportCode Country # Name AirportCode Country1 AcapulcoMexico ACA Mexico 26 GeorgeTownBahamas GGT Bahamas2 AguascalientesMexico AGU Mexico 27 GovernorsHarbourBahamas GHB BahamasGrandCaymanIs.West3 AnguillaLeewardIs. AXA AnguillaWestIndies 28yIndies GCM CaymanIslandsWestIndies4 AntiguaWestIndies ANU Antigua/BarbudaWestIndies 29Grenada(M.Bishop)WindwardIs. GNDGrenada/CarriacouWindwardIslands5 Aruba AUA Aruba 30 GuadalajaraMexico GDL Mexico6 Barbados BGI Barbados 31 GuatemalaCityGuatemala GUA Guatemala7 BarcelonaSpain BCN Spain&CanaryIslands 32 GuayaquilEcuador GYE Ecuador8BelizeCity(Intl)BZEBelize33Halifax(Intl)NSCanadaYHZNovaScotia(NS)City(Intl)BelizeHalifax(Intl)Canada9BeloHorizonte(TancredoNeves)Brazil CNF Brazil 34 Ixtapa/ZihuatanejoMexico ZIH Mexico10 Bermuda(WadeIntl)Bermuda BDA Bermuda 35 Kingston(Intl)Jamaica KIN Jamaica11 BogotaColombia BOG Colombia 36 LaPazBolivia LPB Bolivia12 BrusselsBelgium BRU Belgium 37 Leon/GuanajuatoMexico BJX Mexico13BuenosAires(Pistarini)BAA tiEZEA ti38Lib iC tRiLIRC tRi13rgennargennaeraosacaosaca14 CalgaryABCanada YYC Alberta(AB)Canada 39 LimaPeru LIM Peru15 CaliColombia CLO Colombia 40 LosCabosMexico SJD Mexico16 CancunMexico CUN Mexico 41 MadridSpain MAD Spain&CanaryIslands17 CaracasVenezuela CCS Venezuela 42 ManaguaNicaragua MGA Nicaragua18 CasaDeCampoDominicanRep. LRM DominicanRepublic 43 ManchesterEnglandUK MAN UnitedKingdom19Chih hM iCUUM i44M ibV lMARV luauaexcoexcoaracaiboenezuelaenezuela20 CozumelMexico CZM Mexico 45 MarshHarbourBahamas MHH Bahamas21 CuracaoNeth.Antilles CUR NetherlandAntilles 46 Medellin(Cordova)Colombia MDE Colombia22 DominicaWestIndies DOM DominicaWestIndies 47 MontegoBayJamaica MBJ Jamaica23 DublinIreland DUB Ireland 48 MonterreyMexico MTY Mexico24 FreeportBahamas FPO Bahamas 49 MontevideoUruguay MVD UruguaySOURCE: OAG , December 200925 Ft.DeFranceMartinique FDF Martinique 50 Montreal(P.E.Trudeau)YUL Quebec(QC)CanadaExhibit JA-3Page 8 of 8Linking JAL’s Unique Asia Airports With Unique International AirportsServed By American Will Add 15 080 New Global Immunized Airport PairsServedByAmericanWillAdd15,080NewGlobalImmunizedAirportPairsInternationalAirportsAtWhichAmerican(ButNotJAL)Operates# Name AirportCode Country # Name AirportCode Country51 Nassau(Intl)Bahamas NAS Bahamas 76St.Maarten(P.Juliana)Neth.Antilles SXM NetherlandAntilles( )52 NorthEleutheraBahamas ELH Bahamas 77 TegucigalpaHonduras TGU Honduras53 OttawaONCanada YOW Ontario(ON)Canada 78 Toronto(PearsonIntl)ONYYZ Ontario(ON)Canada54 PanamaCity(Intl)Panama PTY Panama 79 TorreonMexico TRC Mexico55 PointeAPitreGuadeloupe PTP Guadeloupe 80 Tortola/BeefIs.BVI EIS BritishVirginIslands56 ProvidencialesTurks&CaicosIs. PLS Turks&CaicosIslands 81 TreasureCayBahamas TCB Bahamas57 Pt.AuPrinceHaiti PAP Haiti 82 ZurichSwitzerland ZRH Switzerland58 Pt.ofSpainTrinidad POS Trinidad&Tobago59 PuertoPlataDominicanRep. POP DominicanRepublic60 PuertoVallartaMexico PVR Mexico61 PuntaCanaDominicanRep. PUJ DominicanRepublic62 QuitoEcuador UIO Ecuador63 RioDeJaneiro(Intl)RJBrazil GIG Brazil64 SalvadorBABrazil SSA Brazil65 SanJose(Santamaria)CostaRica SJO CostaRica66 SanLuisPotosiMexico SLP Mexico67SanPedroSulaHondurasSAPHondurasHondurasHonduras68 SanSalvadorElSalvador SAL ElSalvador69 SantaCruz(Intl)Bolivia VVI Bolivia70 SantiagoDominicanRep. STI DominicanRepublic71 Santiago(Intl)Chile SCL Chile72 SantoDomingoDominicanRep. SDQ DominicanRepublicSOURCE: OAG , December 2009; MIDT, Year 200973 St.KittsLeewardIs. SKB St.Kitts/NevisLeewardIslands74 St.Lucia(Hewanorra)UVF St.LuciaWestIndies75 St.Lucia(Vigie)WestIndies SLU St.LuciaWestIndiesExhibit JA-4Page 1 of 2The American/JAL Immunized Alliance Will Add 65 NewAsiaAirportsToTheImmunizedoneworldGlobal Networka po ts o e u ed o edoba et oSOURCE: OAG, December 2009Exhibit JA-4Page 2 of 2The American/JAL Immunized Alliance Will Add 65 NewAsiaAirportsToTheImmunizedoneworldGlobal Networka po ts o e u ed o edoba et oAKJ – Asahikawa JapanAOJ – Aomori JapanASJ – Amami O Shima JapanAXT – Akita JapanBKKBangkok (Intl) ThailandKUL – Kuala Lumpur (Intl) MalaysiaMMB – Memanbetsu JapanMMY – Miyako Jima JapanMNL – Manila PhilippinesMSJMisawa JapanBKK–Bangkok(Intl)ThailandCAN – Guangzhou ChinaCTS – Sapporo (Chitose) JapanDLC – Dalian ChinaFSZ – Shizuoka JapanFUK – Fukuoka JapanGAJ–Yamagata JapanMSJ–MisawaJapanMYJ – Matsuyama Shikoku JapanNGO – Nagoya (Intl) JapanNGS – Nagasaki JapanNKM – Nagoya (Komaki) JapanOBO – Obihiro JapanOGN–Yonaguni Jima Japang pGMP – Seoul (Gimpo Intl) Rep. of KoreaHAN – Hanoi VietnamHGH – Hangzhou ChinaHIJ – Hiroshima (Intl) ChinaHKD – Hakodate JapanHNA – Hanamaki JapanHNDTk (H d) JgpOIT – Oita JapanOKA – Okinawa JapanOKJ – Okayama JapanPEK – Beijing (Capital) ChinaPUS – Busan Rep. of KoreaPVG – Shanghai (Pu Dong Intl) ChinaSDJS d iJHND–Tokyo(Haneda)JapanICN – Seoul (Incheon Intl) Rep. of KoreaISG – Ishigaki JapanITM – Osaka (Itami) JapanIZO – Izumo JapanKCZ – Kochi JapanKHH–KaohsiungChinese TaipeiSDJ–SendaiJapanSGN – Ho Chi Minh City VietnamSHA – Shanghai (Hongqiao Intl) ChinaSHM – Nanki Shirahama JapanSIN – Singapore (Changi)TAK – Takamatsu JapanTAO–Qingdao Chinag pKIJ – Niigata JapanKIX – Osaka (Kansai Intl) JapanKKJ – Kita Kyushu JapanKMI – Miyazaki JapanKMJ – Kumamoto JapanKMQ – Komatsu JapanOhiTAOQingdaoChinaTKN – Tokunoshima JapanTKS – Tokushima JapanTPE – Taipei (Taoyuan Intl) ChineseTaipeiTSN – Tianjin ChinaUBJ – Ube JapanSOURCE: OAG, December 2009KOJ–Kagoshima JapanKUH – Kushiro JapanUEO–Kume Jima JapanUKB – Osaka (Kobe) JapanXMN – Xiamen ChinaExhibit JA-5Page 1 of 1The Scope Of The Proposed Joint Venture Will Cover 15 745 TranspacificTheScopeOfTheProposedJointVentureWillCover15,745TranspacificAirport Pairs And Approximately 17.1 Million Annual PassengersCaribbean/North/SouthPacificJointVentureAmericaAirportsAsiaAirportsPacificJointVentureAirportPairs235 X 67 = 15,745The Scope Of The Pacific Joint Venture (Asia Airports To/FromCaribbean/North/South America Airports) Accounts For ApproximatelyCaribbean/North/SouthAmericaAirports)AccountsForApproximately17.1 Million Annual PassengersSOURCE: OAG, December 2009; MIDT, Year 2009Exhibit JA-6Page 1 of 2A G t Of ATI T Th A i /JAL Alli Will N tAGrantOfATIToTheAmerican/JALAllianceWillNotReduce The Intense Competition In The U.S.-Asia Market•21 carriers including four U S network carriers21carriers,includingfourU.S.networkcarriers,operate nonstop scheduled service between 18 U.S.points and 19 Asia points•Delta/Northwest/Korean will continue to hold the largestDelta/Northwest/Koreanwillcontinuetoholdthelargestshare (25.8% of nonstop seats)•American/JAL’s share will be 20.1% of nonstop seatsSOURCE: OAG, December 2009Exhibit JA-6Page 2 of 2A Grant Of ATI To The American/JAL Alliance Will NotR d Th I t C titi I Th U SAi M ktU.S.ToAsiaSeatShares U.S.To/FromAsiaBookingsAirlineCode AirlineNameDailySeats %ShareAirlineCode AirlineNamePassengers%ShareJL/JOJAi li6 21916 3%DL/NWD lt /N th t2 306 29416 0%ReduceTheIntenseCompetitionInTheU.S.-AsiaMarketJL/JOJapanAirlines6,21916.3%DL/NWDelta/Northwest2,306,29416.0%DL/NW Delta/Northwest5,53414.5%UAUnitedAirlines2,174,78715.1%KEKoreanAir4,29911.3%JL/JOJapanAirlines1,700,62811.8%UAUnitedAirlines4,00910.5%KEKoreanAir1,603,27011.2%COContinental Airlines2 9767 8%CXCathayPacificAirways887 5046 2%ContinentalAirlines,.PacificAirways887,504.CXCathayPacificAirways2,3066.1%OZAsianaAirlines725,5575.0%NHAllNipponAirways2,2015.8%BREVAAirways676,6844.7%OZAsianaAirlines2,0165.3%NHAllNipponAirways645,4114.5%CIChinaAirlines1,9055.0%AAAmericanAirlines623,4494.3%AirlinesAmericanAirlines623,449BREVAAirways1,6284.3%CIChinaAirlines604,3834.2%AAAmericanAirlines1,4423.8%PRPhilippineAirlines496,4413.5%SQSingaporeAirlines1,0602.8%COContinentalAirlines485,3023.4%CAAirChina8322.2%CAAirChina410,2522.9%MUChinaEasternAirlines4841.3%SQSingaporeAirlines401,3342.8%PRPhilippineAirlines2310.6%MUChinaEasternAirlines223,9071.6%TGThaiAirwaysIntl2150.6%HAHawaiianAirlines74,1120.5%CZChinaSouthernAirlines2020.5%Other339,7042.4%SOURCE: OAG, December 2009; MIDT, Year 2009Other5391.4%Total14,379,019100.0%Total38,097100%Passengers Traveling on American/Japan Airlines Nonstop Overlaps WillContinue to Benefit From Significant Nonstop (And Other) CompetitionExhibit JA-7Page 1 of 2ContinuetoBenefitFromSignificantNonstop(AndOther)CompetitionNonstop LargestOverlapRouteServiceBefore / AfterMIDTBookingsAA/JLShareNonstopCompetitorBookingShareNYC-NRT 5 to 4 356,860 45.0%NH22.0%LAX-NRT 7 to 6 467,454 20.3% KE 21.7%ORD-NRT 4 to 3 99,231 44.2% UA 25.2%Source: OAG as of 01/31/2010MIDT YE June 2009OverlapCityPair AnalysisExhibit JA-7Page 2 of 2O e ap C ty a a ys sChicago - Tokyo (4 to 3)New York - Tokyo (5 to 4)Airline Code Route Seat ShareBooking ShareJL ORD-NRT 33.3% 28.5%NH ORD-NRT 25.4% 24.5%UA ORD-NRT 24.9% 25.2%AAORD-NRT 16.4% 15.7%Airline Code Route Seat ShareBooking ShareJL NYC-NRT 35.3% 28.4%NH NYC-NRT 19.9% 22.0%DL-NW NYC-NRT 17.2% 7.4%CO NYC-NRT 14.8% 18.8%AANYCNRT12 9%16 6%TOTAL10,521 seatsper week99,231 annualbookingsAANYC-NRT12.9%16.6%TOTAL12,266 seatsper week356,860 annualbookingsLos Angeles - Tokyo (7 to 6)Airline Code Route Seat Share Booking ShareJL LAX-NRT 19.6% 13.5%NHLAX-NRT15.0%14.5%SQ LAX-NRT 14.7% 20.4%DL-NW LAX-NRT 15.7% 12.5%UA LAX-NRT 13.6% 9.6%KE LAX-NRT 11.8% 21.7%AALAX-NRT 9.7% 6.8%Source: OAG as of 01/31/2010MIDT YE June2009TOTAL19,924 seatsper week467,454 annualbookingsJoint Applicants’ U.S. To International RoutesExhibit JA-8Page 1 of 3# Airline Name MarketWeeklyFrequencies # Airline Name MarketWeeklyFrequencies1 American Airlines ACA-DFW 2 40 American Airlines DFW-EZE 72 American Airlines AGU-DFW 7 41 American Airlines DFW-FRA 73 American Airlines ANU-MIA 6 42 American Airlines DFW-GDL 194 American Airlines AUA-BOS 2 43 American Airlines DFW-GRU 95 American Airlines AUA-JFK 3 44 American Airlines DFW-GUA 76 American Airlines AUA-MIA 14 45 American Airlines DFW-LHR 177 American Airlines BCN-JFK 7 46 American Airlines DFW-LIR 28 American Airlines BDA-JFK 7 47 American Airlines DFW-MAD 79 American Airlines BDA-MIA 7 48 American Airlines DFW-MBJ 610 American Airlines BGI-JFK 7 49 American Airlines DFW-MEX 2811 American Airlines BGI-MIA 14 50 American Airlines DFW-MTY 2612 American Airlines BJX-DFW 21 51 American Airlines DFW-NAS 213 American Airlines BOG-MIA 14 52 American Airlines DFW-NRT 1414 American Airlines BOS-CDG 5 53 American Airlines DFW-PLS 115 American Airlines BOS-LHR 17 54 American Airlines DFW-PTY 116 American Airlines BOS-SDQ 1 55 American Airlines DFW-PVR 1717 American Airlines BOS-YYZ 25 56 American Airlines DFW-SAL 318 American Airlines BRU-JFK 7 57 American Airlines DFW-SCL 719American AirlinesBRU-ORD758American AirlinesDFW-SJD21AmericanAirlinesBRU-ORDAmericanAirlinesDFW-SJD20 American Airlines BZE-DFW 7 59 American Airlines DFW-SJO 821 American Airlines BZE-MIA 14 60 American Airlines DFW-SLP 1222 American Airlines CCS-DFW 1 61 American Airlines DFW-TRC 723 American Airlines CCS-JFK 2 62 American Airlines DFW-YUL 724 American Airlines CCS-MIA 28 63 American Airlines DFW-YVR 1525 American Airlines CCS-SJU 7 64 American Airlines DFW-YYC 1426 American Airlines CDG-DFW 7 65 American Airlines DFW-YYZ 2027 American Airlines CDG-JFK 14 66 American Airlines DFW-ZIH 128 American Airlines CDG-MIA 7 67 American Airlines DUB-ORD 629 American Airlines CDG-ORD 7 68 American Airlines EZE-JFK 730 American Airlines CLO-MIA 7 69 American Airlines EZE-MIA 1431 American Airlines CNF-MIA 3 70 American Airlines FCO-JFK 632 American Airlines CUN-DFW 28 71 American Airlines FCO-ORD 433 American Airlines CUN-JFK 9 72 American Airlines FLL-PAP 1234American AirlinesCUN MIA2973American AirlinesFLL SJO1AmericanAirlinesCUN-MIAAmericanAirlinesFLL-SJO35 American Airlines CUN-ORD 7 74 American Airlines FRA-ORD 736 American Airlines CUR-MIA 14 75 American Airlines GCM-MIA 2137 American Airlines CUU-DFW 14 76 American Airlines GIG-MIA 938 American Airlines CZM-DFW 7 77 American Airlines GND-MIA 339 American Airlines DEL-ORD 7 78 American Airlines GRU-JFK 7Joint Applicants’ U.S. To International RoutesExhibit JA-8Page 2 of 3# Airline Name MarketWeeklyFrequencies # Airline Name MarketWeeklyFrequencies79 American Airlines GRU-MIA 22118 American AirlinesMAR-MIA780 American Airlines GUA-MIA21119 American AirlinesMBJ-MIA2181 American Airlines GYE-MIA9120 American Airlines MBJ-ORD182 American Airlines JFK-LHR32121 American AirlinesMDE-MIA1483 American Airlines JFK-MAD5122 American AirlinesMEX-MIA2184 American Airlines JFK-MAN3123 American AirlinesMGA-MIA1485 American Airlines JFK-MBJ5124 American AirlinesMIA-MVD386 American Airlines JFK-MXP6125 American AirlinesMIA-NAS587 American Airlines JFK-NRT7126 American AirlinesMIA-PAP2188 American Airlines JFK-PAP7127 American AirlinesMIA-PLS2189 American Airlines JFK-PLS7128 American AirlinesMIA-POP790A i Ai liJFK PUJ7129A i Ai liMIA POS14AmericanAirlinesJFK-PUJAmericanAirlinesMIA-POS91 American Airlines JFK-SDQ 11130 American AirlinesMIA-PTY1992 American Airlines JFK-SJO4131 American AirlinesMIA-PUJ1493 American Airlines JFK-SKB2132 American AirlinesMIA-SAL994 American Airlines JFK-STI7133 American AirlinesMIA-SAP1395 American Airlines JFK-SXM3134 American AirlinesMIA-SCL796 American Airlines JFK-UVF2135 American AirlinesMIA-SDQ2897American AirlinesJFK-14136American AirlinesMIA-27AmericanAirlinesYHZAmericanAirlinesSJO98 American Airlines JFK-YUL21137 American AirlinesMIA-SKB799 American Airlines JFK-YYZ21138 American AirlinesMIA-SSA7100 American Airlines JFK-ZRH7139 American AirlinesMIA-STI10101 American Airlines KIN-MIA22140 American AirlinesMIA-SXM13102 American Airlines LAX-LHR7141 American AirlinesMIA-TGU7103 American Airlines LAX-NRT7142 American AirlinesMIA-UIO14104 American Airlines LAX-SAL7143 American AirlinesMIA-UVF9105 American Airlines LAX-SJD14144 American AirlinesMIA-YUL21106 American Airlines LAX-YYZ7145 American AirlinesMIA-YYZ21107 American Airlines LGA-YUL 27146 American Airlines NRT-ORD7108 American Airlines LGA-YYZ81147 American Airlines ORD-PEK5109 American Airlines LHR-MIA9148 American Airlines ORD-PVG7110 American Airlines LHR-ORD 25149 American Airlines ORD-PVR3111 American Airlines LHR-RDU7150 American Airlines ORD-SJD5112American AirlinesLIM MIA20151American AirlinesORD YOW20AmericanAirlinesLIM-MIAAmericanAirlinesORD-YOW113 American Airlines LIR-MIA8152 American Airlines ORD-YUL33114 American Airlines LPB-MIA8153 American Airlines ORD-YVR1115 American Airlines LRM-MIA2154 American Airlines ORD-YYC6116 American Airlines MAD-MIA7155 American Airlines ORD-YYZ52117 American Airlines MAN-ORD7156 American Airlines SDQ-SJU7Joint Applicants’ U.S. To International RoutesExhibit JA-8Page 3 of 3# Airline Name MarketWeeklyFrequencies1Japan Airlines1/GUMNRT141JapanAirlines-2Japan Airlines1/GUM-KIX73Japan Airlines1/HNL-NGO74Japan Airlines1/HNL-NRT 275Japan Airlines1/HNL-KIX76 Japan Airlines JFK-NRT97 Japan Airlines GRU-JFK28 Japan Airlines LAX-NRT79 Japan Airlines NRT-ORD710 Japan Airlines NRT-SFO71/OperatedbyJALways,awhollyownedJALsubsidiarySource: OAG as of 01/31/2010JointApplicants’ InternationalCodesharePartnersExhibit JA-9Page 1 of 1Jo t pp ca ts te at o aCodes a eat esAlaska AirlinesASAir FranceAFBritish AirwaysBAAir New ZealandNZBr ssels AirlinesSNAir Tahiti N iTNAmerican Airlines (AA)Japan Airlines (JL, JO, JC, NU)BrusselsAirlinesSNAirTahitiNuiTNCathay Pacific Airways CXAlitaliaAZChina Eastern Airlines MUAmerican Airlines AAClick Grupo Mexicana QAAmerican EagleMQEl Al Israel AirlinesLYBritish AirwaysBAEtihad AirwaysEYCathay Pacific AirwaysCXEtihadAirwaysCathayPacificAirwaysEVA AirwaysBRChina Eastern Airlines MUFinnairAYChina Southern Airlines CZGulf AirGFEmirates Airlines EKHorizon AirQXFinnairAYIberiaIBIberiaIBJAL ExpressJCJetstar AirwaysJQJapan AirlinesJLKorean AirKEJet Airways India Ltd9WMALEV Hungarian Airlines MAJetconnectA507 Mexicana De Aviacion MXLan AirlinesLAQantas AirwaysQFyLAN Argentina4MThai Airways IntlTGLan ExpressLUVietnam AirlinesVNLan PeruLPMALEV Hungarian Airlines MAMexicana De Aviacion MXSource: OAG as of February 2010Qantas AirwaysQFRoyal JordanianRJVietnam AirlinesVNCarriers operating Scheduled InternationalExhibit JA-10Page 1 of 2Services at American’s Hubs and Gateway CitiesDallas-Fort Worth (DFW) Miami (MIA) New York (JFK) Los Angeles (LAX) Chicago (ORD)Air Canada Aerogal Aer Lingus Aeroflot Russian Airlines Aer LingusAir Canada Jazz Aerolineas Argentinas Aeroflot Russian Airlines Aeromexico AeromexicoAmerican Airlines Aeromexico Aerogal Aeromexico Connect Aeromexico ConnectAmerican Eagle Aeromexico Connect Aeromexico Air Canada Air CanadaBritish Airways Aerosur Aerosvit Airlines Air Canada Jazz Air Canada JazzKLM-Royal Dutch Airlines Air Berlin Air China Air China Air FranceKorean Air Air Canada Air Dominicana Air France Air IndiaLACSAAir DominicanaAir EuropaAir New ZealandAir JamaicaAirDominicanaAirEuropaAirNewZealandAirJamaicaLufthansa Air Europa Air France Air Pacific Alitalia-Compagnia AereaMexicana De Aviacion Air France Air India Air Tahiti Nui All Nippon AirwaysSun Country Airlines Alitalia-Compagnia Aerea Air Jamaica Alaska Airlines American AirlinesTaca Intl Airlines American Airlines Alitalia-Compagnia Aerea Alitalia-Compagnia Aerea American EagleAmerican Eagle All Nippon Airways All Nippon Airways Asiana AirlinesAmerican Eagle/ExecutiveAmerican AirlinesAmerican AirlinesBritish AirwaysAmericanEagle/ExecutiveAmericanAirlinesAmericanAirlinesBritishAirwaysAvianca American Eagle Asiana Airlines Cayman AirwaysAvior Airlines Asiana Airlines Avianca Etihad AirwaysBahamasair Austrian Airlines British Airways GoJet AirlinesBritish Airways Avianca Cathay Pacific Airways IberiaCaribbean Airlines British Airways China Airlines Japan AirlinesCayman Airways Caribbean Airlines China Eastern Airlines KLM-Royal Dutch AirlinesCopa Airlines Cathay Pacific Airways China Southern Airlines Korean AirCorsair Intl Cayman Airways Copa Airlines LACSAFinnair China Eastern Airlines Delta Air Lines LOT Polish AirlinesGulfstream Intl Airline Comair Inc. El Al Israel Airlines LufthansaIberia Copa Airlines Emirates Airlines Mexicana De AviacionInsel Air Delta Air Lines EVA Airways Privatair SALACSAE tiH i AiR lJ d igypairorzonAirRoyalJordanianLan Airlines El Al Israel Airlines Japan Airlines SAS Scandinavian AirlinesLAN Argentina Emirates Airlines KLM-Royal Dutch Airlines SWISSLan Peru Etihad Airways Korean Air Taca Intl AirlinesLanEcuador Eurofly LACSA Turkish AirlinesCarriers operatingScheduled InternationalExhibit JA-10Page 2 of 2p gServices at American’s Hubs and Gateway CitiesMiami (MIA) New York (JFK) Los Angeles (LAX) Chicago (ORD)LTU International Airways Finnair Lan Airlines UA EXP/ShuttleLufthansa Iberia Lan Peru UA EXP/SkywestMexicana De Aviacion Icelandair LTU International Airways UA EXP/Trans StateSanta Barbara Airlines Japan Airlines Lufthansa United AirlinesSurinam Airways Jet Airways India Ltd Malaysia Airlines USA 3000 AirlinesSWISS jetBlue Airways Mexicana De Aviacion Virgin Atlantic AirwaysTaca Intl Airlines KLM-Royal Dutch Airlines Northwest AirlinesTACA PK AiQ t AieruoreanAiranasAirwaysTAM Linhas Aereas Kuwait Airways Singapore AirlinesVirgin Atlantic Airways LACSA SWISSWestJet Lan Airlines Taca Intl AirlinesLanEcuador Thai Airways IntlLOT Polish Airlines UA EXP/SkywestLTU International AirwaysUnited AirlinesLTUInternationalAirwaysUnitedAirlinesLufthansa VaustraliaMexicana De Aviacion Virgin Atlantic AirwaysOpenSkies VolarisPakistan Intl Airline WestJetQatar AirwaysRoyal Air MarocRoyal JordanianSaudi Arabian AirlinesSingapore AirlinesSouth African AirwaysSWISSTaca Intl AirlinesSource: OAG as of 01/31/2010TAM Linhas AereasTurkish AirlinesUzbekistan AirwaysVirgin Atlantic AirwaysXL Airways FranceTheJointApplicants’U.S. ToAsiaNonstopRoutesExhibit JA-11Page 1 of 1e Jo t pp ca ts U S o s a o stop outesAirport PairWeeklyFrequenciesDFWNRT 14American Airlines (AA)Airport PairsWeeklyFrequenciesGUMKIX** 7Japan Airlines (JL JO)JFKNRT 7LAXNRT 7NRTORD 7ORDPEK* 5ORDPVG 7GUMNRT** 14HNLKIX** 7HNLNGO** 7HNLNRT**27JFKNRT 9* Effective 04/26/2010* * Operated by JALways, awholly owned JAL subsidiaryLAXNRT 7NRTORD 7NRTSFO 7Source: OAG as of 01/31/2010

# CERTIFICATE OF SERVICE

I hereby certify that I have this day served the foregoing

document by email on the following persons:

sascha.vanderbellen@delta.com jhill@dlalaw.com

scott.mcclain@delta.com bill@mietuslaw.com

sametta.c.barnett@delta.com mgoldman@sgbdc.com

kquinn@pillsburywinthrop.com rsilverberg@sgbdc.com

bkeiner@crowell.com dhainbach@ggh-airlaw.com

mrosia@crowell.com mcmillin@woa.com

bruce.rabinovitz@wilmerhale.com mchopra@jamhoff.com

jeffrey.manley@united.com russell.bailey@alpa.org

bob.kneisley@wnco.com dkirstein@yklaw.com

robert.land@jetblue.com jyoung@yklaw.com

msinick@ssd.com donna.kooperstein@usdoj.gov

cdonley@ssd.com dwight.moore@ustranscom.mil

anbird@fedex.com jim.ballough@faa.gov

dvaughan@kelleydrye.com byerlyjr@state.gov

kevin.montgomery@polaraircargo.com recohn@hhlaw.com

jrichardson@johnlrichardson.com cjsimpson@zsrlaw.com

lhalloway@crowell.com pmurphy@lopmurphy.com

efaberman@wileyrein.com lachter@starpower.net

mroller@rollerbauer.com anita.mosner@hklaw.com

howard.kass@usairways.com rpommer@atlasair.com

benjamin.slocum@usairways.com gmurphy@crowell.com

sophy.chen@hklaw.com

____________________________ JEFFREY A. OGAR

February 12, 2010