United, Continental Airlines to merge
TEXT OF STORY
Stacey Vanek-Smith: Continental Airlines and United Airlines have plans to merge. The deal would create the biggest carrier in the world. Marketplace’s Jennifer Collins has more.
Jennifer Collins: This merger has been “the talk” for years. This United Airlines ad would barely have to be rewritten.
UNITED AD: Where you go in life is up to you. There’s one airline that can take you there.
The merger could be announced as soon as Monday. If the deal goes through, the new company will keep the United brand and ditch the Continental name. Julius Maldutis with Aviation Dynamics says the deal will help the carriers stay stable in a turbulent market.
Julius Malduitus: You have too many airlines to begin with, so you have great competition all over the place. Not only domestically, but on a global basis.
Legacy carriers have been hammered by low-cost upstarts. United lost $82 million in the first quarter.
Richard Gritta teaches airline finance at the University of Portland. He says the merger may not be the best news for fliers, who already pay extra fees for everything from snacks to checked bags.
Richard Gritta: The fact is you’re going to have a huge airline and they are going to be able then to raise prices.
Gritta says even though the deal will create the world’s biggest airline, it probably won’t be considered a monopoly by government regulators.
I’m Jennifer Collins for Marketplace.
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