US-AA Antitrust Suit Shows Feds’ Wishful Thinking

Source: Aviation Week & Space Technology

But keep in mind we have not heard the other side of the case in detail. US Airways and American have said the benefit to consumers will be a choice among three strong network carriers where now there are really only two. This is an important factor with a certain type of customer. Frequent fliers who remain loyal to a particular network enjoy special advantages through its carriers' rewards program. The message for US Airways and American in the challenge from Justice is that they had better be prepared to show in very specific ways how the New American would benefit consumers and not simply make vague promises about “synergies” that will allow them to be more competitive against Delta and United.

Never has the metaphor of the scales of justice been more apt. The judge's job will be simple but not easy—add up the anti-competitive aspects of the merger on one side and the pro-competitive features on the other, and weigh them. This could be a close call.


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