BEFORE THE DEPARTMENT OF TRANSPORTATION WASHINGTON, D.C. ANSWER OF AMERICAN AIRLINES, INC. TO ORDER

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1 BEFORE THE DEPARTMENT OF TRANSPORTATION WASHINGTON, D.C. Applications of AMERICAN AIRLINES, INC. Docket DOT-OST DELTA AIR LINES, INC. HAWAIIAN AIRLINES, INC. in the matter of 2010 U.S.-Haneda Combination Services Allocation Proceeding ANSWER OF AMERICAN AIRLINES, INC. TO ORDER Howard Kass Vice President Regulatory Affairs Robert A. Wirick Managing Director, Regulatory and International Affairs Abigail Donovan Director, Congressional and Federal Affairs American Airlines, Inc th Street, N.W. Washington, DC (202) April 6, 2015

2 BEFORE THE DEPARTMENT OF TRANSPORTATION WASHINGTON, D.C. Applications of AMERICAN AIRLINES, INC. DELTA AIR LINES, INC. Docket DOT-OST April 6, 2015 HAWAIIAN AIRLINES, INC. in the matter of 2010 U.S.-Haneda Combination Services Allocation Proceeding ANSWER OF AMERICAN AIRLINES, INC. TO ORDER American Airlines, Inc. ( American ) hereby answers Order ( Order ), in which the Department of Transportation ( Department ) tentatively determined that Delta Air Lines, Inc. ( Delta ) should retain the U.S.-Haneda slot pair currently allocated to it for daily year-round scheduled service between Seattle and Tokyo s Haneda Airport, subject to conditions and reporting requirements set forth therein. I. American Strongly Supports the Conditions Imposed by the Department and Stands Ready to Commence Daily Haneda Service within 60 Days American wishes to thank the Department for its thorough consideration of the difficult issues involved in this proceeding. American recognizes the significant challenge the Department faced in balancing competing interests. While American would have preferred to begin Haneda service, American accepts the Department s tentative decision, provided that the conditions and requirements proposed to be placed on Delta s retention of the slot pair are imposed in the Final Order and not diminished in any way.

3 American applauds the Department s decision to impose safeguards on Delta s use of this particular slot pair to ensure that Delta provides the daily year-round service it promised between Seattle and Haneda. 1 This includes Delta s requirement to obtain a waiver for nonoperation, a quarterly reporting requirement regarding slot pair utilization, and the Department specifying that Delta s authority to operate the slot pair automatically expires if the slot pair is not used. American strongly supports the Department s two-year tentative designation of American as the backup carrier to serve Haneda, and stands ready to implement Los Angeles-Haneda service within 60 days of its backup award being activated, ensuring continuity of service and maximization of the public benefits associated with this slot pair. II. The Department s Proposed Conditions are the Minimum Required to Ensure Delta Uses its Seattle-Haneda Slot Pair Undoubtedly, Delta will request the Department eliminate or reduce these necessary safeguards on its use of the Seattle-Haneda slot pair. The more Delta protests these safeguards, the more skeptical the Department should be of Delta s willingness to abide by its daily yearround service commitment. American urges the Department not to dilute its proposed conditions, and not to yield to any Delta threat of litigation. 2 Given Delta's history with regard to this slot pair, the proposed conditions are the minimum required to ensure that either (i) Delta actually provides daily year- 1 Response of Delta to Evidence Request, January 5, 2015, Docket DOT-OST , p. 2. See also Delta Press Release, Delta Issues Statement on DOT Tentative Decision on Haneda Slots, March 27, 2015 ( Delta will operate year-round, nonstop flights between Seattle and Haneda. ) available at Delta-issues-statement-on-DOT-tentative-decision-on-Haneda-slots. 2 Should Delta pursue its current litigation or initiate new litigation over this proceeding, the Department can be assured of American s support for the Department s position. Indeed, American has already filed to intervene in the current litigation. (See Motion of American Airlines, Inc. for Leave to Intervene, filed on March 27, 2015, in the case of Delta Air Lines, Inc. v. U.S. DOT, March 13, 2015, D.C. Cir.) 2

4 round service between Seattle and Haneda or (ii) this scarce resource is automatically, and without delay, reallocated in an economically efficient and consumer friendly way. Delta s past actions with this slot pair warrant nothing less, and American will vigorously object to any diminution of the Department s proposed conditions and safeguards. American also endorses the Department s proposed reservation of its right, on its own initiative and without hearing, to activate the backup award to American in the event of any repeated pattern of non-performance, or of waiver requests seeking to justify non-performance by Delta. 3 compliance. This proposed condition protects consumers should Delta attempt to circumvent American urges the Department to strictly apply this condition upon implementation. III. American Will Continue to Seek Haneda Access American remains the only U.S. global airline that cannot provide its own service to Haneda the most important airport in one of the most important countries in Asia. American has less Asia service than Delta and United, and gaining greater access to Asia remains a top priority for American. 4 American s disappointment in not gaining Haneda access in this proceeding is heightened by Delta s efforts to impede liberalized access to Haneda for any carrier except itself. American calls upon the Department to move beyond Delta s past efforts to block liberalized Haneda access, and promptly renew formal negotiations with the Government of Japan to secure Haneda access for American. Further liberalization will enable American to compete with the U.S. 3 Order, p See Answer of American Airlines, Inc., January 5, 2015, Docket DOT-OST , Exhibits AA-T-1 and AA- T-2. 3

5 airlines currently serving Haneda, and provide the benefits the Department s Order specifically recognized American s service would produce. 5 IV. Conclusion The Department has thoroughly considered the issues in this proceeding and the need to ensure a scarce resource is used to benefit consumers. While American would have preferred to start Haneda service, American supports the Department s tentative decision in Order , provided American remains the backup carrier, and the conditions and requirements proposed therein are made final without relaxation. American also urges the Department to expeditiously begin negotiations with Japan to secure additional Haneda access. Respectfully submitted, Howard Kass Robert A. Wirick Abigail Donovan 5 See Order, p. 7, 9. 4

6 CERTIFICATE OF SERVICE I, Abigail Donovan, certify that, on April 6, 2015, I caused to be served a copy of the foregoing Answer of American Airlines, Inc. by upon those addressees listed below: paul.gretch@dot.gov (DOT) brian.hedberg@dot.gov (DOT) brett.kruger@dot.gov (DOT) todd.homan@dot.gov (DOT) peter.irvine@dot.gov (DOT) englets@state.gov (Dep t of State) cristinasa@state.gov (Dep t of State) eugene.alford@ita.doc.gov (Dep t of Commerce) ejames@jamhoff.com (Allied Pilots Association) seth.waxman@wilmerhale.com (Delta) sascha.vanderbellen@delta.com (Delta) chris.walker@delta.com (Delta) Mike.Donatelli@alpa.org (Delta MEC/ALPA) john.s.duncan@faa.gov (FAA) jhill@cooley.com (Hawaiian) perkmann@cooley.com (Hawaiian) Robert.Lamansky@hawaiianair.com (Hawaiian) glindsey@lawa.org (Los Angeles World Airports) ishiwata.k@portseattle.org (Port of Seattle) safora.i@portseattle.org (Port of Seattle) dan.weiss@united.com (United) steve.morrissey@united.com (United) gmurphy@crowell.com (United) sseiden@crowell.com (United) info@airlineinfo.com (AirlineInfo.com) Abigail Donovan