One decade after labor unions and the Department of Justice busted a merger attempt, United and US Airways are at it again. The two airlines have been in merger talks for several weeks. Delta and Northwest are already in the process of merging, so US Air and United are feeling the heat. The Washington Post has more:
In 2008, sources had told Reuters that US Airways was in parallel talks with United and Continental Airlines Inc about a possible merger, when Delta Air Lines was merging with Northwest to create the world’s largest airline. The talks ended as United chose to pursue an alliance with Continental instead.
Airline industry consultant Michael Boyd said United’s talks with US Airways might be intended to signal to Continental that they are ready to renew merger talks.
“If you take a look at those two carriers, there’s a tremendous amount of overlap,” Boyd said, referring to United and US Airways. “This is likely to get Continental, which would be a better fit, out of the barn to start talking.”
Speaking at (a) summit, US Airways Chief Financial Officer Derek Kerr said: “Consolidation is one of the major ways this industry can become profitable.”
If consolidation is “one of the major ways” for airlines to become profitable, I shudder to think what the other ways are. $45 carry-on baggage, I bet.
Consolidation also reminds me that we may one day be flying alliance airlines, like Oneworld, rather than name-brand fleets. We’re already edging closer to that.