United-Continental Merger Would Create World’s Largest Airline

Travel News — By John Curran on May 3, 2010 at 5:07 pm

United Airlines has been looking to take on another airline for years, and while its dance card had also included USAir, a deal has been announced that would merge Continental and United to create the world’s largest airline carrier.

Industry analysts have noted that the deal would benefit two groups: business travelers who will benefit from the increased number of hubs that will result, as well as passengers who value multi-stop flights on one carrier, reports BusinessWeek. At the same time, the $3 billion merger will do little to reduce fares because of reduced competition.

While the deal isn’t likely to be completed for another year or so, considering that it will involve integrating resources from the nation’s third and fourth largest carriers, ticket prices could already rise as competitors find less competition on many routes. Other fares that could see increases are flights between Continental’s hubs in Houston and Newark and United’s in Los Angeles, for example.

Business travelers are likely to see the merged company as a better choice than Delta, the current leader in trip planning according to the Huffington Post.

The deal is contingent on government regulators finding that the merger doesn’t violate any antitrust regulations, an issue considering the number of overlapping routes and lack of competitors on several flights.

[Image: Continental]

Tags: business travel, Continental, Mergers, United Airlines

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