You must select a newsletter to subscribe to. For consumers, the merger could eventually result in higher prices. That reduces the number of seats in the industry and allows airlines to increase fares.
With around 220 seats, the Dreamliner will be able to operate on routes which would not be viable for the larger Boeing 777s which can carry anywhere between 269 and 348 passengers. In addition, United and Continental will no longer be competing against each other on some routes, allowing them to save money but offering travelers fewer options.
So are there not enough resources devoted to tackling these sorts of problems? According to the International Air Transport Association Iata , Tilton and Smisek's caution is borne out by the latest industry data, with the average price of economy and premium fares for all airlines only halfway to regaining the levels they achieved in early 2008.
However, while analysts back airline mergers because they allow carriers to pool costs and raise fares on routes where they used to compete, industry experts have warned that concerted hikes in ticket prices are unlikely, even if the United Continental deal wins regulatory approval. It is Continental's distinctive globe logo on the tail fin, even if the new airline is called United. United blamed it on the merger.
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US Airways , which three weeks ago began its own merger talks with United, is now left on the sidelines, raising questions about its ability to survive as a stand-alone carrier.
A 58 year-old fan of Crosby, Stills, Nash and Young, who trained as a corporate lawyer, now finds himself at the helm of not only America's — but the world's largest carrier, with 87,000 staff and 1,252 aircraft. It was the discussion over how to transport pets which rammed home to Jeff Smisek the challenges of merging United and Continental to form the world's largest airline.
There has also been some grouchiness from passengers who used to fly on Continental, the brand which disappeared after 78 years in existence. And on what sort of scale is it appropriate to describe a three-year-old problem as "temporary?
Tell us what you think. Glenn Tilton, United's chief executive, who will be non-executive chairman of the latest tie-up, said: The United-Continental merger Truly united?
The merger is expected to be completed before the end of the year. The combined airline has been able to mix and match its fleet, using the flexibility to put the right plane on the right route.
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But in the last two years, United has improved its cash position, aggressively reduced capacity, raised new revenue from bag and other fees, and cut costs. Invalid email address. Related Articles. While the first news reports of a possible merger appeared on April 16, Jeffery A.