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United abandons deal to add more slots at Newark airport

A United Airlines jet at Newark Airport

Federal officials say United Airlines is abandoning its attempts to buy additional take-off and landing slots at Newark Liberty International Airport. | AP file photo

NEWARK, N.J. — United Airlines is abandoning its attempts to purchase additional takeoff and landing slots at Newark Liberty International Airport, a move the U.S. government had sued to prevent over fears it would lead to higher fares and fewer choices for passengers.

The decision was announced Wednesday by the Department of Justice, which had sued in November to block the proposed acquisition of 24 slots from Atlanta-based Delta Air Lines. United already controlled 902 of the roughly 1,200 slots at the airport but didn’t use all of them, according to the lawsuit. It has more than 10 times as many slots as any other airline.

The Chicago-based airline had said when the lawsuit was filed that the New York City area was the most competitive airline market in the country and that it needed to add the slots to enhance service and manage congestion.

But the FAA announced last week that it was easing limits on the number of hourly flights at the airport, a move that could result in lower airfares. A lawyer representing United wrote in a letter to the DOJ that the FAA’s decision prevented the two airlines from “meeting various contractual requirements.”

Newark had the highest average fares ($479) of the largest U.S. airports in the third quarter of 2015, the latest data available, according to the Bureau of Transportation Statistics.

In June, United sold its remaining slots at New York’s Kennedy Airport to Delta in return for getting slots from Delta at Newark, which is closer to lower Manhattan. Delta’s new slots at JFK weren’t affected by the lawsuit, and it began using them in November.

Virgin America has long protested United’s dominance over Newark, saying it wanted to add more flights into the airport and lower fares. The Burlingame, California-based airline, which is being purchased by Alaska Air Group, has several daily transcontinental flights but wants to compete more with United, American Airlines, Delta and JetBlue. The routes are some of the most profitable in the country.

The Port Authority of New York and New Jersey, which operates Newark Liberty, said the FAA’s move should lead to more competition among airlines.