Merger Of American Airlines and US Airways Will Create World's Largest Carrier
The boards of US Airways Group and AMR have approved the merger of American Airlines and US Airways. The resulting company will become the world's largest airline. American is in bankruptcy, so its creditors will own a big chunk of the new company and US Airways shareholders will own the rest.
ROBERT SIEGEL, HOST:
From NPR News, this is ALL THINGS CONSIDERED. I'm Robert Siegel.
American Airlines and U.S. Airways announced an $11 billion merger today. A few more numbers for you. The new carrier, the world's largest, will have 950 planes, 94,000 employees and fly to more than 300 destinations. It will also go by the name American Airlines.
From Dallas, NPR's Wade Goodwyn reports that the merger is a chance for two struggling airlines to become an industry leader.
WADE GOODWYN, BYLINE: Although the news provoked plenty of groaning and predictions of doom coming from the dispirited peanut gallery that constitutes our nation's flying public these days, at American Airlines headquarters in Fort Worth, joy and hopefulness prevailed.
GOODWYN: U.S. Airways' current CEO, Doug Parker, will be the head man at the new American.
DOUG PARKER: I couldn't be happier to be here. It's an exciting day for both U.S. Airways and American. This combination is the best path forward for our customers, our employees, our communities and our shareholders.
GOODWYN: American's employees are also thrilled, especially the pilots, who've had a terrible history with American management. Jennifer Ewald flies a Super 80 for American. She predicts customers will see a big change in attitude.
JENNIFER EWALD: By merging these two airlines, you create a much bigger network, it's more competitive. You're going to have more flexibility and options for passengers. And, frankly, if you've got happy employees, they'll make sure that your passengers are happy.
GOODWYN: Many industry analysts also approved.
JAMIE BAKER: You know, in a sense, it almost feels like Christmas morning. You know, we went to bed excited, we tossed and turned, we woke up before the alarm, we ran into the office.
GOODWYN: Jamie Baker is a senior airline equity analyst for JP Morgan and an authority on American Airlines. He believes overhauling management can make a world of difference to morale and performance.
BAKER: Yeah, look, I think that American employees are ready to work hard. They did require a regime change, they want new bosses. But I think they're also looking forward to becoming, you know, sort of reenergized as the public recognizes the service improvements and the investments that are going to be made in the merged company.
GOODWYN: And Baker doesn't expect the new American will curtail service to many smaller cities.
BAKER: Today's deal isn't about rationalizing capacity and downsizing. It's about restoring American's network to its rightful place so that it can stand shoulder to shoulder with the likes of Delta and United.
GOODWYN: As for whether this merger would mean an increase in fares, Baker says perhaps, but he believes that what the flying public could get in the exchange will be worth it. American and U.S. Airway's executives say they hope to complete the merger by the end of September. Wade Goodwyn, NPR News, Dallas. Transcript provided by NPR, Copyright NPR.View this story on npr.org