1:04 pm August 31, 2012, by Christopher Seward
There was Southwest Airlines’ buyout of AirTran, Delta Air Lines’ deal with Northwest and United’s with Continental. Now it looks like American Airlines and US Airways are hoping to taxi down the tarmac.
American and US Airways said Friday they are in fact-finding talks that could lead to a deal. “It does not mean we are merging — it simply means we have agreed to work together to discuss and analyze a potential merger,” US Airways CEO Doug Parker told employees in a letter.
Analysts say the combination would allow the airlines to give Atlanta-based Delta and United Airlines more competition, since it would create a third mega carrier.
“You would have the international operations of AMR and the lower cost structure of US Airways,” Morningstar analyst Basili Alukos told Reuters.
Delta, the largest carrier serving Hartsfield-Jackson International Airport, already is getting more competition from Southwest, which began merging operations this year with AirTran, the second-largest carrier serving Hartsfield-Jackson.
A combined US Airways-American would have a considerable presence in New York, Philadelphia, Washington, Charlotte, N.C., Miami, Chicago, Dallas, Phoenix and Los Angeles, according to The Associated Press.
AMR Corp., the parent of American, has been in Chapter 11 bankruptcy protection since last November, and US Airways has had its eye on a deal for some time.
Further consolidation of the airline industry could mean even higher airfares based on a trend noted by the Bureau of Transportation Statistics, according to the AP. The BTS said the price of a domestic round-trip flight has climbed nearly 20 percent over the last 10 years after adjustments for inflation. Rising fuel prices are part of the reason. The industry also has piled on baggage and other fees to help its bottom line.
Is more consolidation of the airline industry a good thing, or more trouble for travelers?
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