Will Newest Airline Merger Affect Memphis?

Posted on: 4:30 pm, February 14, 2013, by , updated on: 05:31pm, February 14, 2013

(Memphis) Travelers, like David Jaqua, are optimistic that the most recent merger between American Airlines and U.S. Airways will be good for Memphis.

“It could only get better,” he said, before boarding his flight to Dallas,” said Jaqua.

In 2008 when Delta merged with Northwest, high ticket prices and fewer flights resulted after Delta removed Memphis as a hub.

“We certainly were hurt with the last merger,” said Jaqua. “I’m not sure its a good thing to be a hub. It might be better not to be a hub.”

Scott Brockman, Executive Vice-President for the Memphis-Shelby County Airport Authority, says the merger should not affect Memphis flights.

“Memphis is a spoke to both American and US Air,” said Brockman. “They’re feeding a hub not being the hub and in American and US Air, they’re flying to different locations.”

American leaves Memphis headed for places like Chicago and Miami, where U.S. Air only serves Charlotte and Washington D.C.

“They have very diverse networks that they’re merging together and in Memphis’ case none of them overlap,” said Brockman.

He said anytime airlines merge, competition goes down, typically driving prices up, “I don’t know that will be the effect in Memphis because we already have fairly high prices, it may in other markets.”

Brockman says airlines don’t merge to get larger, but more efficient.

He hopes the Merger will create opportunities for American Airlines in Memphis, but claims only time will tell, “Anything today is speculation, [American] will develop their process as they go forward and that will take years.”

It cold be up to eight or nine months to get regulatory approval on this merger.

Then the two airlines could become one. Brockman says it could take up to two years to find out what kind of impact the merger will have on Memphis.