Apparently there is such a thing as ‘too big’! (U.S Airways-American Airlines merger)

United States Capitol Building

United States Capitol Building (Photo credit: Jack’s LOST FILM)

The shareholders said yes. So did the European Comission.

But now the U.S Department of Justice and six U.S States want to stop the US Airways and American Airlines merger from happening, citing lack of competition on a number of routes if American and US would become one as a cause.

My initial reaction is that i’m surprised by this manouver from the DOJ. I mean even the Europeans gave this deal a green light and a thumbs up. But it does make sense however as the general public are the ones who in the end will end up paying for poor competition if US-American would get certain high yield routes to themselves.

The Dallas Morning News has more on this here.

Advertisements

3 thoughts on “Apparently there is such a thing as ‘too big’! (U.S Airways-American Airlines merger)

    • That is a very valid question in my mind, one which answer i’m not completely sure of.

      I think in some cases yes, there needs to be regulation in certain industries. But this case i find hard to decide.

      I mean what’s stopping other cheaper airlines from establishing routes in direct competition with the proposed US-American?

      • Our airlines are complicated. I live here and I don’t get it. Many airlines such as Jet Blue have made good money by only serving certain airports. These routes that the US-American airline would serve may not be profitable enough to attract smaller airlines as the demand may not be enough.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s