Top Nav

Merger Bringing Change in the Wind

UPDATE:

American Airlines has won bankruptcy court approval to combine with US Airways; this merger will create the world’s biggest airline.

 

American filed for Chapter 11 in 2011.  For the merger to move forward, The U.S. Department of Justice antitrust regulators and shareholders with US Airways need to approve the agreement.

 

The following story recently appeared in Flagstaff Business News’ print edition.

 

On Thursday, Feb. 14, US Airways and American Airlines announced a merger between the two major airlines, which, if approved would create a “new” airline that retains the American Airlines name. So, what does such a merger mean to Flagstaff, where currently five US Airway flights a day leave from Pulliam airport?

According to information provided by Andrew Christie, US Airways associate manager of media relations, this merger will not result in anything but good news. “The combination of American and US Airways brings together two highly complementary networks with access to the best destinations around the globe. Among other things, we expect to serve our communities by maintaining all hubs currently served by American Airlines and US Airways, while expanding service to and from non-hub cities.”

A fact sheet provided by Christie indicates that the new American Airlines would “maintain a significant corporate and operational presence in Phoenix…Together, American Airlines and US Airways employ approximately 10,000 people in Arizona and will continue to have five departures a day from Flagstaff Pulliam Airport.”

According to an article in The Washington Post on Feb. 13, “The marriage [between American and US Airways] would rescue American from bankruptcy and put the much smaller US Airways into a partnership with the muscle to compete against Delta Air Lines and United Airlines, both of which have grown through recent mergers.”

It seems that such a merger would have little impact on the immediate future, but Peter Greenberg, travel editor for CBS News, says the merger, if approved, would result in higher airfares. He is not alone in his analysis of this. Rob Lovitt of NBC Travel News shared similar thoughts and Genevieve Shaw Brown of ABC News indicated, “Higher airfare tends to hit smaller cities harder than larger cities, again, because smaller cities and airports have less competition.” Of course, this would not be good news for Flagstaff residents.

For the moment, however, nothing will change. Tickets will still be valid for both airlines and scheduled flights should remain as they are. Frequent flyer programs will continue and if the merger is approved, the two programs should integrate without loss of miles or elite status.

The Washington Post article indicated that the Board of Directors for both airlines approved the merger but now it must be approved by the U.S. Department of Justice and a New York judge who is overseeing the bankruptcy of the parent company of American Airlines, AMR Corporation, before it is final.

Should the merger be approved, there is a bit of good news in terms of carry-on bags. According to an ABC News report by Shaw Brown, the new American Airlines “has no plans to charge for carry-on bags.” So, even if airfares increase, carry-on bags will still be free.

For right now, life at Pulliam Airport in Flagstaff will continue as is. US Airways will maintain its regular schedule and most people will probably not even think about what is going on behind the scenes with the Department of Justice and the judge overseeing the bankruptcy proceedings. Once the merger is complete, which, according to Greenberg, should take a year, there may be changes in the wind for the Flagstaff community. However, for right now, everything is up in

,

No comments yet.

Leave a Reply

Website Design by DRCMedia LLC