World's biggest airline created by US carriers' merger

American Airlines and US Airways have agreed an $11bn (£7bn) merger that will create the biggest airline in the world with some 1,500 planes, more than 3,000 flights every day, and 100,000 staff.

The combined business will fly under the American Airlines brand, but be run by US Airways' chief executive, Doug Parker. American's top executive, Tom Horton, will serve as a temporary chairman until the middle of next year.

Fears were raised that prices would rise as a result: after the deal, a combined AA-US airline plus Delta and Southwest will together control three-quarters of America's flight traffic.

"A US Airways-American combination poses potential concerns for competition and consumers," said Diana Moss, vice-president of the non-profit group the American Antitrust Institute. Its study found ticket prices rose 30 per cent on some United-Continental routes and 20 per cent on some Delta routes after their mergers.

Mr Parker said: "Our combined network will provide a significantly more attractive offering to customers, ensuring that we are always able to take them where they want to go."

British fliers are likely to be affected as International Airlines Group, the owner of British Airways and Iberia, has a joint venture with AA that sees the airlines share transatlantic routes, schedules and fares.

"From IAG's point of view, we think this deal is good news as it creates a much stronger US partner and boosts the scope of the transatlantic joint venture," said the aviation analyst Edward Stanford at Oriel Securities.

Although the deal still has to be approved by competition regulators and a US bankruptcy court, the US Justice Department has not challenged an airline merger since a proposed United-US Airways tie-up in 2000.

The merger is the third major US airline deal since 2008, with United combining with Continental, and Delta buying Northwest.

US airlines have faced major turbulence over the past decade, with Delta, Northwest, United, American and US Airways all filing for bankruptcy protection to keep their assets safe from creditors while they restructured. AA remains in Chapter 11 protection: its bankruptcy creditors will have 72 per cent of the company, with US Airways investors owning the rest.

US airlines struggled in the aftermath of a plunge in demand following the September 11 terrorist attacks, and used the bankruptcy protection to counter the effects of high wage bills and rocketing fuel bills.

Start your day with The Independent, sign up for daily news emails
Life and Style
love + sex A new study has revealed the average size - but does that leave men outside the 'normal' range being thought of as 'abnormal'?
Voices
The Palace of Westminster is falling down, according to John Bercow
voices..says Matthew Norman
Sport
Steve Bruce and Gus Poyet clash
football
Arts and Entertainment
Jake and Dinos Chapman were motivated by revenge to make 'Bring me the Head of Franco Toselli! '
arts + ents Shapero Modern Gallery to show explicit Chapman Brothers film
Arts and Entertainment
Kurt Cobain performing for 'MTV Unplugged' in New York, shortly before his death
music Brett Morgen's 'Cobain: Montage of Heck' debunks many of the myths surrounding the enigmatic singer
Sport
Brendan Rodgers
football The Liverpool manager will be the first option after Pep Guardiola
Life and Style
life
ebooks
ebooksA special investigation by Andy McSmith
Sport
Christian Benteke of Aston Villa celebrates scoring the winner for Aston Villa
football
Arts and Entertainment
Myanna Buring, Julian Rhind-Tutt and Russell Tovey in 'Banished'
TV Jimmy McGovern tackles 18th-century crime and punishment
Arts and Entertainment
Paul Whitehouse as Herbert
arts + ents
News
Bill O'Reilly attends The Hollywood Reporter 35 Most Powerful People In Media Celebration at The Four Seasons Restaurant on April 16, 2014 in New York City
media It is the second time he and the channel have clarified statements
News
people
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Sales Executive - OTE £40,000

£15000 - £18000 per annum: Recruitment Genius: This is a great opportunity for...

Austen Lloyd: Law Costs HOD - Southampton

£50000 - £60000 per annum + Excellent Salary: Austen Lloyd: An outstanding new...

SThree: Recruitment Resourcer

£20000 - £21000 per annum + uncapped commission: SThree: As a graduate you are...

Ashdown Group: Junior Application Support Analyst - Fluent German Speaker

£25000 - £30000 per annum + benefits: Ashdown Group: A global leader operating...

Day In a Page

Syrian conflict is the world's first 'climate change war', say scientists, but it won't be the last one

Climate change key in Syrian conflict

And it will trigger more war in future
How I outwitted the Gestapo

How I outwitted the Gestapo

My life as a Jew in wartime Berlin
The nation's favourite animal revealed

The nation's favourite animal revealed

Women like cuddly creatures whilst men like creepy-crawlies
Is this the way to get young people to vote?

Getting young people to vote

From #VOTESELFISH to Bite the Ballot
Poldark star Heida Reed: 'I don't think a single bodice gets ripped'

Poldark star Heida Reed

'I don't think a single bodice gets ripped'
The difference between America and Israel? There isn’t one

The difference between America and Israel? There isn’t one

Netanyahu knows he can get away with anything in America, says Robert Fisk
Families clubbing together to build their own affordable accommodation

Do It Yourself approach to securing a new house

Community land trusts marking a new trend for taking the initiative away from developers
Head of WWF UK: We didn’t send Cameron to the Arctic to see green ideas freeze

David Nussbaum: We didn’t send Cameron to the Arctic to see green ideas freeze

The head of WWF UK remains sanguine despite the Government’s failure to live up to its pledges on the environment
Author Kazuo Ishiguro on being inspired by shoot-outs and samurai

Author Kazuo Ishiguro on being inspired by shoot-outs and samurai

Set in a mythologised 5th-century Britain, ‘The Buried Giant’ is a strange beast
With money, corruption and drugs, this monk fears Buddhism in Thailand is a ‘poisoned fruit’

Money, corruption and drugs

The monk who fears Buddhism in Thailand is a ‘poisoned fruit’
America's first slavery museum established at Django Unchained plantation - 150 years after slavery outlawed

150 years after it was outlawed...

... America's first slavery museum is established in Louisiana
Kelly Clarkson: How I snubbed Simon Cowell and become a Grammy-winning superstar

Kelly Clarkson: How I snubbed Simon Cowell and become a Grammy-winning superstar

The first 'American Idol' winner on how she manages to remain her own woman – Jane Austen fascination and all
Tony Oursler on exploring our uneasy relationship with technology with his new show

You won't believe your eyes

Tony Oursler's new show explores our uneasy relationship with technology. He's one of a growing number of artists with that preoccupation
Ian Herbert: Peter Moores must go. He should never have been brought back to fail again

Moores must go. He should never have been brought back to fail again

The England coach leaves players to find solutions - which makes you wonder where he adds value, says Ian Herbert
War with Isis: Fears that the looming battle for Mosul will unleash 'a million refugees'

The battle for Mosul will unleash 'a million refugees'

Aid agencies prepare for vast exodus following planned Iraqi offensive against the Isis-held city, reports Patrick Cockburn