United-Delta Merger Not Likely -- But Get Ready Anyway
Tongues are wagging about the prospect of a United-Delta merger that emerged from the rumor mill last week. And while there are good reasons not to believe this particular deal will actually move forward, you should expect some merger action among major carriers -- and a significant shift in the marketplace in the near future.
Of course, merger rumors have been rampant for quite a while. “Most pundits have been saying that we have a capacity problem: too many seats,” Eric Smith, co-chair of the aviation practice group at Schnader, Harrison, Segal & Lewis in Pittsburgh, tells TDR. Continental Airlines has been the focus of merger rumors for over a year, Smith points out.
But the United-Delta chatter has been the loudest. So what’s it all mean?
For the LCCs, there's potential for pricing flexibility, if not much new market share. Meanwhile, the GDSs had best prepare to face a negotiation batter, and travel agencies should get ready for some puzzled customers. Want more details on these coming industry changes? Read the cover story in TDR Vol.15 No.25. Not a subscriber? Sign up here.
-- Scott Walker, Editor in Chief, TDR