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Report: American Airlines, US Airways to Create World’s Largest Airline With Merger

Feb. 13, 2013 8:18pm
American Airlines, U.S. Airways to Create Worlds Largest Airline With Merger?

Getty Images

DALLAS (TheBlaze/AP) — American Airlines and US Airways will merge and create the world’s biggest airline. The boards of both companies approved the merger late Wednesday, according to four people close to the situation.

The carrier keeps the American Airlines name but will be run by US Airways CEO Doug Parker. American’s CEO, Tom Horton, will become chairman of the new company, these people said. They requested anonymity because the merger negotiations were private.

A formal announcement is expected Thursday morning.

The deal has been in the works since August, when creditors forced American to consider a merger rather than remain independent. American has been restructuring under bankruptcy protection since late 2011.

Together, American and US Airways will be slightly bigger than United Airlines. Travelers won’t notice immediate changes. It will likely be months before the frequent-flier programs are merged, and possibly years before the two airlines are fully combined.

If the deal is approved by American’s bankruptcy judge and antitrust regulators, the new American will have more than 900 planes, 3,200 daily flights and about 95,000 employees, not counting regional affiliates. It will expand American’s current reach on the East Coast and overseas.

American Airlines, U.S. Airways to Create Worlds Largest Airline With Merger?

Getty Images

The merger is a stunning achievement for Parker, who will run the new company. Parker’s airline is only half the size of American and is less familiar around the world, but he prevailed by driving a wedge between American’s management and its union workers and by convincing American’s creditors that a merger made business sense.

Just five years ago, American was the world’s biggest airline. It boasted a history reaching back 80 years to the beginning of air travel. It had popularized the frequent-flier program and developed the modern system of pricing airline tickets to match demand.

But years of heavy losses drove American and parent AMR Corp. into bankruptcy protection in late 2011. The company blamed bloated labor costs; its unions accused executives of mismanagement.

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Comments (11)

  • ThurstonHowellIV
    Posted on February 14, 2013 at 12:12pm

    The two airlines with the WORST service are getting together. At least they have a common culture of treating customers as a huge inconvenience.

    Report this comment

    ThurstonHowellIV  
  • PDfromToledo
    Posted on February 14, 2013 at 9:17am

    Seems to me this is nothing short of an airline monopoly and price fixing.

    Report this comment

    PDfromToledo  
    • JRook
      Posted on February 14, 2013 at 9:37am

      Over paying unions, if that is what actually was the problem, is also a management failure. There are countless successful businesses that have unionized employees. To stupid all unions as ignorant as saying the management at Enron, bailed out banks, bankers who fraudulently gamed the LIBOR rate are good capitalists.

      Report this comment

      JRook  
  • revelation2012
    Posted on February 13, 2013 at 9:22pm

    if those commercial flights are SPRAYING ‘they’ are in BED with the united nations – agenda 21

    Report this comment

    revelation2012  
  • alinskythis
    Posted on February 13, 2013 at 8:42pm

    Oh, great.

    A One World Airline.

    Report this comment

    alinskythis  
  • Eastinfection
    Posted on February 13, 2013 at 8:39pm

    Whatever.
    Obummer and his disciples will eventually confiscate all of the Airlines for “the good of the State”anyway.

    Report this comment

    Eastinfection  
  • Darmok and Jalad at Tanagra
    Posted on February 13, 2013 at 8:37pm

    You no longer have to shop around for crappy, abusive flight service that will make you late, and leave you feeling violated. Now it’s a one stop shop. We hire only the angriest, bi-polar flight attendents, we underpay and overwork all of our pilots, and we only employ the most borderline psychotic mechanics. So we know you had a choice of airline, and now we have narrowed that choice down.

    Forget flying the friendly skies, take an adventure with the US American Disfunctional family, and buckle up, it’s going to be a bumpy, grumpy flight.

    Report this comment

    Darmok and Jalad at Tanagra  

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