Tuesday, August 13, 2013
|Federal and state lawsuit challenging the proposed merger of U.S. Airways and American Airlines|
American Airlines and U.S. Airways compete directly on thousands of heavily traveled nonstop and connecting routes, including nearly 200 routes beginning or ending in Texas cities. According to the State’s antitrust complaint, the proposed merger would result in decreased competition, higher airfares and fees, reduced service and downgraded amenities. The dollar impact nationwide could exceed $100 million a year.
The merger would make a combined U.S. Airways/American Airlines the largest worldwide carrier and reduce the number of the larger legacy airlines from four to three U.S. Airways/American, United/Continental and Delta/Northwest and the number of major airlines from five to four. If the merger were approved, the three remaining legacy airlines combined with Southwest Airlines would account for more than 80 percent of domestic travel.
American Airlines, which is being released under Chapter 11 bankruptcy Thursday, remains as U.S. Airways’ chief competitor in the marketplace. Therefore, removing American as a competitor in keeping fares and fees lower will likely only serve to increase those prices.