RENO, Nev., April 16 /PRNewswire/ -- Reno Air, Inc.
(Nasdaq: RENO; PSE: RNO) today confirmed it has filed a lawsuit against
Northwest Airlines (Nasdaq: NWAC) in Federal District Court in Reno, Nevada.
The lawsuit seeks to recover ongoing damages from Northwest's predatory
response to the carrier's entry into the Minneapolis/St. Paul market in April,
When Reno Air announced new service between Minneapolis/St. Paul and
Reno/Lake Tahoe in February, 1993, Northwest Airlines retaliated by announcing
it would overlay the carrier's routes from Reno to Minneapolis/St. Paul,
Seattle, Los Angeles and San Diego. At the time, Reno Air was less than a
year old, and Northwest had no scheduled service to or from Reno/Lake Tahoe.
Also, despite the large fare premiums Northwest Airlines enjoyed at their
Minneapolis/St. Paul hub, they manipulated fares and service to minimize Reno
Air's passenger traffic.
"This lawsuit is a response to events which occurred in 1993," said Reno
Air Vice President and General Counsel Bob Rowen. "We contend that Northwest
Airlines used its much larger size to foreclose competition and maintain
expensive air fares." When Reno Air announced new, affordable service from
the Twin Cities, Northwest overlapped Reno Air's service arid engaged in a
variety of tactics, including below-cost pricing, to drive us from the market.
These actions were predatory, and we're confident they violated the antitrust
"Government studies have shown that airfares in Minneapolis/St. Paul are
among the highest in the country," said Steve Sarner, Reno Air's Vice
President of Marketing and Sales. "Once Reno Air was forced to leave the
market, Northwest Airlines doubled their prices in the Reno market, and
consumers were again held hostage by Northwest's inflated airfares."
Since 1992, Reno Air has brought affordable airfares and full service to
major markets throughout the West, Midwest, Canada, Alaska and the Mississippi
Gulfcoast. Despite operating in highly competitive West coast markets, Reno
Air earned a net profit of $1.95 million in 1995 and $2 million in 1996.
Northwest's hubs in Minneapolis/St. Paul and Detroit have been repeatedly
recognized as having some of the highest airfares in the country.
Reno Air serves 24 cities and currently operates nearly 200 daily
departures. The carrier's fleet of 30 McDonnell Douglas MD-80 and MD-90
series jets has an average aircraft age of less than six years.
SOURCE Reno Air Inc.