Why United Plus American Could Equal More Woe for Passengers
A tie-up between the carriers would cut the number of major US airlines to just three.
United CEO Scott Kirby after a White House meeting last fall.
Photographer: Al Drago/Bloomberg
For decades, global crises—particularly those affecting energy—have been a catalyst for consolidation in the US airline industry. The recession in the early 1980s, coupled with deregulation, spurred Texas Air to combine with Continental and accelerated Northwest’s merger with Republic. The Sept. 11 terrorist attacks helped drive TWA out of business and prompted US Airways to buy America West. And with the industry limping around the time of the global financial crisis, Delta bought Northwest, United took over Continental, and Southwest grabbed AirTran. Now, with oil prices soaring due to the war in Iran and the closure of the Strait of Hormuz, United Airlines Chief Executive Officer Scott Kirby is eyeing a mega-deal that would reshape the aviation industry not just in the US, but globally.
On April 14, Bloomberg News reported that Kirby, in a February meeting with US President Donald Trump, floated the idea of a tie-up with American Airlines. Together, the carriers would control more than a third of the US market measured by passenger traffic, with significant overlap in Chicago, Los Angeles, Washington and about 10 other US hubs.