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Friday, February 15, 2013

Senate Commerce Chairman Expresses Concern on American Airlines Merger

Senate Commerce Committee Chairman Jay Rockefeller expressed concern Thursday regarding the proposed merger between American Airlines (AA) and US Airways.

Rockefeller said while major network airline mergers have created financially viable airlines in the past, they also lead to higher airfare for consumers.

“Industry consolidation has created stronger and more financially viable airlines, which are necessary for our country’s long-term economic growth. But, it has also resulted in fewer choices for consumers, higher air fares, and reduced air service to small and medium sized communities,” Rockefeller said.

“Any further airline merger must be carefully evaluated to make sure it is in the best interest of the travelling public by creating more competition, more options, and lower fares,” the chairman added.

Rockefeller’s Senate Committee on Commerce, Science and Transportation committee is tasked with reviewing the proposed merger. If approved, the new American Airlines will be the world’s largest airline. AMR, the parent company of AA, would retain 72 percent ownership and US Airways shareholders will control the remaining 28 percent.

The merger is also subject to approval from the court overseeing American’s bankruptcy proceedings. More

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