WASHINGTON (Reuters) - Delta Air Lines DAL.N and Canada's WestJet said late on Friday they had scrapped a proposed U.S.-Canada joint venture after the U.S. government demanded changes the airlines insisted were "unreasonable and unacceptable".
The airlines said in a filing that the U.S. demands were “arbitrary and capricious” especially the slot divestitures.
The Delta-WestJet joint venture would have had a combined 27% share of scheduled air carrier transborder capacity, while the dominant carrier, Air Canada AC.TO, has 45%.
Canada, with 38 million people, is the second-largest U.S. international passenger air market after Mexico, with Toronto flights accounting for over 50% of transborder air travel demand.
U.S. air carriers had urged slot divestitures at LaGuardia, noting American Airlines AAL.O, Delta and United Air Lines UAL.O control 83% of all slots, with Delta controlling 45% of flights.
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