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Thu February 14, 2013
Merged Airline Could Mean Growth For North Texas
Today’s American Airlines - U.S. Airways merger not only creates the world’s biggest carrier, it could also be like a shot in the arm to the North Texas economy.
Analysts say U.S. Airways and American Airlines reached this deal because the two carriers, left alone, would suffer at the hands of giant competitors Delta, United and Southwest Airlines. But U.S. Airways CEO Doug Parker says together, everything changes for the better.
“Analysts and others should go run their own projections for American and U.S. Airways stand alone, but when you do that and input them together, our recommendation is you add at least a billion dollars a year in synergies because that’s the value we’re going to get from putting these two carriers together.”
Parker says that means money for growth, which is already under way at American. D/FW Airport CEO Jeff Fegan says that means a better bottom line for his airport.
“I do think especially as they get delivery of some longer haul airplanes I think you’re going to see a lot of growth on the international front. We’re forecasting not just American but D/FW overall, probably another twenty-four international destinations over the next five years. So we think American will be a large part of that."
Fegan says that growth not only benefits the airport, but the region.
“Real growth takes place when more flights come in, more airplanes, more flight attendants, more pilots. So as their numbers grow in terms of operations, you will see additional growth here at D/FW Airport.
This merger also promises to help cool labor-management friction at American, which has sometimes rubbed passengers the wrong way. Just ask American frequent flyer Peter Biocca, who says flying used to be better.
“And you were treated nicely. Now everybody’s under stress. The passenger means a lot less and the passenger feels it.”
American Pilot Scott Shankland expects customer service will now improve because the source of that friction, American management, will be replaced by U.S. Air’s CEO Parker and his team.
“I think you’ll see customer satisfaction across the board go up with this airline pretty soon. I think it’ll start with customer service, because you’re going to have happier employees dealing with the customers and then as the merger takes place, you’re going to see happier customers as far as what type of service they can get on the airline.”
Still, Shankland knows it’ll take months for that transition. Parker publicly thanked American CEO Tom Horton for the opportunity. Horton will become chairman of the board but will eventually step down.
Parker said “You need to have one leader and only one leader the rest of the airline sees. And Tom was nice enough to agree to hang around to help me with that transition. But then he also cared enough about American to know that once that transition happens, the company needs to see one leader. And he was confident in me to let me be that, which I’m elated to do.”
Horton responded, “Don’t mess it up.”
“I’ll try not to," replied Parker, to laughter.
And also, don’t worry about those frequent flyer miles, say leaders from both carriers. They will be honored, says American’s Tom Horton, who adds...
"Well, it’s only upside for frequent flyers. So Advantage members can now earn and redeem miles across a bigger broader network that takes them to more places and the same goes for U.S. Airways frequent flyer members of U.S. Airways."
This deal is expected to close later this summer or early fall.