The merger also does not threaten competition in military programs. Though both Boeing and McDonnell Douglas develop fighter aircraft, there are no current or future procurements of fighter aircraft by the Department of Defense in which the two firms would likely compete. Finally, there are no other domestic military markets in which the products offered by the companies are substitutes for each other. While the merger seems to pose no threat to the competitive landscape in either the commercial aircraft or in various defense markets, we find the twenty year exclusive contracts Boeing recently entered with three major airlines potentially troubling. We intend to monitor the potential anticompetitive effects of these, and any future, long term exclusive contracts.
Speculation is easy, but there is absolutely no evidence that any such behavior occurred here.
The Commission today announces that it will not challenge the proposed merger of The Boeing Company and McDonnell Douglas Corporation. I also agree with my colleagues that no action is warranted concerning the twenty-year exclusive arrangements for commercial aircraft that Boeing recently reached with three major U.S. airlines. Given the state of the law and the fact that the exclusive arrangements apparently are unrelated to the proposed transaction, what is curious is that my colleagues choose to mention them at all. Another aspect of the proposed transaction is the combination of two of the three remaining manufacturers of commercial aircraft in the world. This horizontal combination of two of the three firms in the market appears to present a rather straightforward case for a challenge by the Commission.