When the announcement came last week that American Airlines and US Airways were shaking hands on an $11 billion merger, the business travel industry took a moment to ask: will this have an effect on us? The answer is yes… eventually.
It could take months for the merger to be approved, and several years for the two airlines to operate together. But travel managers and business travelers alike should start thinking about how this deal at 35,000 feet could impact your work on the ground.
Likely fare hikes – and discounts
When United merged with Continental, Southwest with AirTran, and Delta with Northwest, fares went up. According to the Bureau of Labor and Statistics, since those mergers, the cost of a domestic round-trip flight has risen 11 percent. But if history is any indicator, a merger of big players also gives rise to the little ones: the merger is an opportunity for carriers like Allegiant and Spirit Airlines to make inroads in the discount market.
Marriage of miles
Road warriors worried about how the consolidation will impact their hard-earned air miles – don’t fret. The airlines plan to honor each other’s loyalty programs, although US Airways will leave the Star Alliance for American’s Oneworld Alliance. That means you’ll have to use your former Star miles on the 12 Oneworld carriers, including British Airways, Cathay Pacific and Qantas.
Potential labor disruption
Growing pains are inevitable when two behemoths join forces. Which counter do you check into? Which terminal is the right one? While the ground logistics get the kinks worked out, the bigger headaches involve technology and employees. Merging an airline also combines computer systems, labor unions, contracts, and all the behind-the-scenes stuff that impact take-off. Be warned: expect eventual labor strikes, computer glitches and passenger-service system issues.
The merger between American Airlines and US Airways should be good for competition – after all, it’s now a real challenger to prevent the duopoly of international U.S. carriers Delta and United. But with any big merger, the changes will be slow and the transitions could be rough. Pack patience on your next trip to the airport.
Featured image courtesy of: Horia Varlan