Could United and American Merge?

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Could United and American Merge?

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According to bombshell reports today, United Airlines CEO Scott Kirby has approached senior US government officials about merging with American Airlines. Kirby is notoriously pro-merger, but this is almost certainly a bridge too far for the Department of Justice. President Trump’s DOJ is more open to big combinations, but such a merger would be essentially unheard of. By passengers carried, American and United are the first and third largest carriers in the country, respectively. Together, they fly 1/3rd of all passengers in America.

There’s no hard and fast limits when it comes to antitrust laws - it’s all up to the Department of Justice and the Department of Transportation. But, a jetBlue - Spirit merger was shut down under monopoly concerns, and their combined market share is only 9%. The merger was blocked under President Biden’s administration, which was more conservative when it comes to consolidation, but there’s a huge difference between 33% and 9%, even under a pro-merger administration.

It’s unclear what exactly the government’s response to Kirby’s inquiry is. It’s also unclear whether American Airlines was consulted about this first and what their response would be.

If it did happen…

I think it’s an interesting concept, however unrealistic it may be. In Kirby’s scenario, it seems that United would have been the one to take over American, not vice versa. If that happened, United would gain massive strongholds in the Southwest (Phoenix) and Southeast (Miami & Charlotte). Additionally, they’d dominate Texas’ two biggest airports, Houston-Intercontinental and Dallas-Fort Worth.

The busiest airport in the world, Chicago-O’Hare, would become a United fortress hub, with a 75% market share. Los Angeles, another one of America’s largest gateways, would flip from Delta dominant to United dominant with a 31% market share. Both of Washington, D.C.'s major airports would become United hubs, as would all three of New York City’s airports.

United would inherit healthy bases in Philadelphia and a growing market in Boston, both of which United has fairly minimal service to.

Their combined fleets would be nothing short of crazy. Excluding regional operators, the United Mainline fleet would consist of 2,098 jets. Including regional operators, it would be 3,070, more than triple the second largest (Delta Air Lines at 992).

All these stats just go to show how unlikely such a merger is to be approved. If United is serious and if American is looking to consolidate, it would absolutely crush airline competition in the world’s largest market. Generally speaking, competition is good for customers - it lowers ticket prices, gives travelers more options, and makes airlines better themselves to get the edge over their rivals.

Sources:

Airlines for America
Bloomberg
Reuters
Wikipedia (American Airlines Fleet)
Wikipedia (United Airlines Fleet)

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Un(i)-Ameri can 'ted airline :sob:

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No no no! I do not wish to see this. It was better I didn’t hear of this.

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Very interesting and insane to think about. This would destroy the US airline market in ways I don’t think it could handle. But I don’t really think it’s possible based on the carriers being in different alliances, and the US Government would probably shut it down.

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Bro…So If the two airlines merge, it might become Trump Airlines

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essentialy yea

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Yeah. Secretary of Transportation Sean Duffy has said he’s open to a merger involving one of the “Big Four,” but I don’t think he had this in mind. I feel like he felt like a Big Four - smaller airline merger would be on the table (like United + JetBlue), not amongst the top dogs.

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Umm… don’t think so lol. It’d be under the United brand.

That was a thing through, at least for a little bit. Didn’t go so well.

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I suppose, yeah, but I agree with the JetBlue + United part. Along with this, destroying the airline market is not really possible. But the Government could do anything. It’s a nice concept, though, to think about how they could rule as a global airline across every continent. Also, with so many hubs, it would be very difficult to operate.

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At least China, a communist country, operates multiple airlines despite having only one government.Market monopoly will lead to the worst possible outcome: ex) Delta Airlines acquiring Southwest

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There is no way this gets approved, it would be an absolute monopoly, not only for the American market, but also for international flights. This would shake up the global aviation market, so I can’t even imagine this going through.

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If American Airlines disappears because of this, I will create Alla Airlines (الله Airlines)(new AA sign)

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Anyone else pick up on how the United CEO’s last name is “Kirby?” That tells me all I need to know and describes the situation perfectly. The jokes really do write themselves.

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no matter what happens delta will still be better

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Lmao :rofl: nah I agree tho!

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I highly doubt Mr T would even invest into a new company or airline since he’s you know…busy.

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He do be inhaling every single thing in a 10 mile radius fr

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This won’t happen at all. These airlines already have a massive route network and huge fleets of aircraft, so I don’t see them merging at all given their position in the aviation market in the US

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Just why :thinking::thinking::thinking:

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