A major merger in the airline industry. The CEOs for American Airlines and U.S. Airways are expected to make the announcement this morning. But the Valentine's Day coupling may not be a sweetheart deal for consumers.
American Airlines and U.S. Airways are joining forces to form the biggest airline in the world.
"Our best goal going forward is to make it the biggest, strongest airline in the country, and I suppose that's about to happen," said Chris Manno, an American Airlines pilot.
The combined carrier will have American's new look, and it's old name. It will rank ahead of United Airlines, which joined with Continental in 2010, and Delta which absorbed Northwest Airlines in 2008.
American Airlines currently serves the Springfield-Branson National Airport (SGF).
"The only way to survive, at least most airlines believe, is to merge together, grow and don't overlap as much," believes Rick Seaney, CEO of farecompare.com.
With American in bankruptcy, it will be up to a federal judge to decide if the deal will be a good one for its creditors.
"American, if it had not done some kind of merger, would have been inferior to its bigger competitors in terms of its network," says Darryl Jenkins, an aviation industry consultant.
The Department of Justice will also have to sign off on the deal. Federal regulators will look at whether the merger would lead to less competition.
"American will virtually have a monopoly on every route that they fly," notes Bernard Weinstein, an economics professor at SMU.
If the deal flies, the world's four biggest airlines would control nearly 70-percent of all air traffic. Experts say ticket prices could take off as a result.
"Even though people say this particular merger of US Airways and American Airlines isn't going to raise ticket prices, I don't believe that one bit," says Seaney.
Despite those concerns, the merger is expected to be approved.
Experts say travelers on American and U.S. Airways will not notice any immediate changes.
They say it will likely be months before the frequent-flier programs are combined and years before the two airlines are fully integrated.
(Susan McGinnis, CBS News)
American Airlines and U.S. Airways are joining forces to form the biggest airline in the world.
"Our best goal going forward is to make it the biggest, strongest airline in the country, and I suppose that's about to happen," said Chris Manno, an American Airlines pilot.
The combined carrier will have American's new look, and it's old name. It will rank ahead of United Airlines, which joined with Continental in 2010, and Delta which absorbed Northwest Airlines in 2008.
American Airlines currently serves the Springfield-Branson National Airport (SGF).
"The only way to survive, at least most airlines believe, is to merge together, grow and don't overlap as much," believes Rick Seaney, CEO of farecompare.com.
With American in bankruptcy, it will be up to a federal judge to decide if the deal will be a good one for its creditors.
"American, if it had not done some kind of merger, would have been inferior to its bigger competitors in terms of its network," says Darryl Jenkins, an aviation industry consultant.
The Department of Justice will also have to sign off on the deal. Federal regulators will look at whether the merger would lead to less competition.
"American will virtually have a monopoly on every route that they fly," notes Bernard Weinstein, an economics professor at SMU.
If the deal flies, the world's four biggest airlines would control nearly 70-percent of all air traffic. Experts say ticket prices could take off as a result.
"Even though people say this particular merger of US Airways and American Airlines isn't going to raise ticket prices, I don't believe that one bit," says Seaney.
Despite those concerns, the merger is expected to be approved.
Experts say travelers on American and U.S. Airways will not notice any immediate changes.
They say it will likely be months before the frequent-flier programs are combined and years before the two airlines are fully integrated.
(Susan McGinnis, CBS News)
