“You’ll see some additional service, I believe, from Miami to Europe because of the merger, and better connections to Asian markets,” he said. “It’ll be good for the Miami area.”
Herbst, founder of AirlineFinancials.com, said the deal solidifies employment for American Airlines employees in Miami. He said he was confident that the leadership of the merged airline “will do everything they can to make sure Miami stays as one of the major hub airports of the system.”
Still, analysts say some negatives for travelers may emerge. Combining two competitors could drive up fares, said Rick Seaney, CEO and co-founder of Dallas-based FareCompare.
“The only good news is that if airlines get too frisky with higher prices, consumers will let them know quickly by cutting back on air travel,” he said.
The priciest fares will occur at hubs where the merged airline will have little competition, including Houston and Charlotte, analysts said. And consumers can expect to see fare jumps on routes where American and US Airways have overlapping nonstop service, such as Philadelphia to DFW or Miami, Charlotte to Miami and DFW, and Phoenix to Miami.
But Brett Snyder, who runs the CrankyFlier.com blog, believes that higher-than-average fares would be limited to few cities.
“There are very few markets where they (American and US Airways) today have overlapping services,’’ he said. “They operate pretty independently from each other.”
The carrier will be run by US Airways CEO Doug Parker. American’s CEO, Tom Horton, will become chairman of the new company through the first shareholders meeting, when Parker will take over a chairman. AMR stakeholders will own 72 percent of the new company’s common stock; US Airways shareholder will own 28 percent, the company said.
The merger is a stunning achievement for Parker. His 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. Unions already have voted to support a merger, and a group of unsecured creditors has agreed to the arrangement, according to Thursday’s company statement.
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. It was unseated as the world’s largest airline after United Airlines merged with Continental and Delta Air Lines merged with Northwest.
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.
Miami Herald staff writer Douglas Hanks and Business Editor Jane Wooldridge contributed to this report, which was supplemented with information from the Associated Press and the Fort Worth Star-Telegram.