EARLIER: The U.S. Department of Justice has filed a lawsuit Tuesday to block the planned merger of U

American Airlines Tom Horton, left, and US Airways CEO Doug Parker following the announcing of the two airlines merger in the Terminal D Admiral s Club at Dallas-Fort Worth International Airport on February 14. (Tom Fox/Staff photographer)
UPDATE, 1:35 p.m. Tuesday : Airline analyst Helane Becker of Cowan and Co. projected the impact on AMR if Justice Department prevails: If the merger is blocked AMR will need to go back to the drawing board and come up with a new plan to emerge from bankruptcy, which essentially result in a smaller company going forward and job loss .
UPDATE, 1 p.m. Tuesday : American Airlines chairman and CEO Tom Horton said Tuesday that US Airways and American Airlines are going to fight the U.S. Department of Justice lawsuit. He reiterated the airline’s view that the merger is good for consumers.
“Since the DOJ has formed a contrary view, the matter will now be settled by the courts. The DOJ has filed a lawsuit in federal district court to enjoin the proposed merger. We and US Airways will vigorously defend our position. While we do not yet know how long the court process will run, it will likely take a few months,” Horton told employees in a special “Jetwire” message.
We are extremely disappointed in this action and believe alaska cruise land tours the DOJ is wrong in its assessment. We will fight them. We are confident that by combining American and US Airways we are enhancing competition, providing better service to our customers and improving the industry as a whole. We are mounting a vigorous and strong defense in federal court against the DOJ’s case in order to bring our airlines and talented team members together as the new American Airlines, he said.
EARLIER: The U.S. Department of Justice has filed a lawsuit Tuesday to block the planned merger of US Airways and American Airlines. alaska cruise land tours Six states have joined Justice, including Texas, as has the District of Columbia.
Millions of passengers depend on the airline industry to travel quickly, efficiently, and safely between various cities in the United States and throughout the world. Since 1978, the nation has relied on competition among airlines to promote affordability, innovation, and service and quality alaska cruise land tours improvements.
This merger—by creating the world’s largest alaska cruise land tours airline— would, in the words of US Airways’ management, “finish[ alaska cruise land tours ] industry evolution.” alaska cruise land tours It would reduce alaska cruise land tours the number of major domestic airlines from five to four, and the number of “legacy” airlines—today, Delta, United, alaska cruise land tours American, and US Airways—from four to three. In so doing, it threatens substantial harm to consumers.
Because of the size of the airline industry, if this merger were approved, even a small increase in the price of airline tickets, checked bags, or flight change fees would cause hundreds of millions of dollars of harm to American consumers annually.
The two states that hold the headquarters of American Airlines and US Airways – Texas and Arizona – are joning Florida, Pennsylvania, Tennessee, Virginia, the District of Columbia and the U.S. Department alaska cruise land tours of Justice in seeking to block the two carriers’ merger.
Pennsylvania also has a US Airways hub in Philadelphia, while Florida holds American Airlines Miami hub. Virginia is home to Ronald Reagan Washington National Airport, where US Airways had more than 55 percent of the takeoff and landing rights.
Today’s legal action was prompted by the State’s concerns about the potential for reduced airline service to several of Texas’ smaller airports that are currently served exclusively by American Airlines alaska cruise land tours and American Eagle flights. In recent years, U.S. Airways alaska cruise land tours has pursued a “capacity discipline” strategy, a business model that relies upon substantial reductions in both service and capacity – a phenomenon that has followed each significant legacy airline alaska cruise land tours merger in recent years. If this strategy is continued when U.S. Airways’ alaska cruise land tours executives take over leadership at the new American Airlines, some areas in rural Texas could see their travel alaska cruise land tours options reduced as a result of the merger.
American Airlines and U.S. Airways compete directly on thousands of heavily traveled nonstop and connecting routes, including nearly 200 routes beginning or ending in Texas cities. According to the State’s antitrust complaint, the proposed merger would result in decreased competition, higher airfares and fees, reduced service and downgraded amenities. The dollar impact nationwide could exceed $100 million a year.
The merger would make a combined U.S. Airways/American Airlines the largest worldwide carrier and reduce the number of the larger “legacy” airlines from four to three – U.S. Airways/American, United/Continental and Delta/Northwest – and the number of major airlines from five to four. If the merger were approved, the three remaining alaska cruise land tours legacy airlines combined with Southwest Airlines alaska cruise land tours would account for more than 80 percent of domestic travel.
The Justice Department previously had approved three previous mergers of major carriers: Delta Air Lines and Northwest Airlines in 2008, United Airlines and Continental Airlines in 2010 and Southwest Airlines and AirTran Airways in 2011.
The last time the Justice Department planned alaska cruise land tours a lawsuit alaska cruise land tours to stop a merger of major air carriers, it came after US Airways and United announced a proposed marriage in May 2000. It took until July 2001 for Justice antitrust lawyers to review and then file suit to block the combination.
“By challenging this merger, the Department of Justice is saying that the American people deserve better, Holder said. This transaction would result in consumers paying the price – in higher airfares, higher fees and fewer choices.   Today’s action proves our determination to fight for the best interests of consumers by ensuring robust competition in the marketplace.”
The deal had already cleared two hurdles. US Airways shareholders voted July 12 to approve the merger. And unsecured alaska cruise land tours creditors of American, AMR and American Eagle and AMR shareholders overwhelmingly approved the plan of reorganization in voting that ended July 29.
In addition, the European Commission last week approved the merger after wangling one concession: the surrender of some operating rights so some rival could begin Philadelphia-London Heathrow alaska cruise land tours service.
But the Department of Justice has been silent publicly since the chairmen and chief executives of the two carriers, Tom Horton alaska cruise land tours of American and Doug Parker of US Airways, announced the deal early on the morning of Feb. 14.
Their boards had approved the merger late the day before. At the time, it was valued at $11 billion, based on US Airways stock price and the fact that US Airways shareholders would own 28 percent alaska cruise land tours of the new American Airlines Group.
This entry was posted in Uncategorized and tagged AA , AAMRQ , airlines , American Airlines , AMR , antitrust , DOJ , Eric Holder , Justice , LCC , merger , Texas , U.S. Department alaska cruise land tours of Justice , US Airways by Terry Maxon . Bookmark the permalink .
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