According to multiple sources quoting multiple unnamed sources, the merger deal between American Airlines and US Airways is heating up.
The latest comes from The Wall Street Journal. In a report that cites "people close to the discussions," the newspaper says directors of both American and US Airways plan to meet tomorrow (Feb. 13) to consider a merger.
In its report, the Wall Street Journal writes:
"The two companies could disclose a deal later that day or on Thursday, the people said. Nearly all the significant points of the deal have been finalized, they said.
Some outstanding issues remained, which could delay the scheduled board meetings and the announcement of the merger by a day or perhaps into next week, the people cautioned."
The Associated Press reports that no matter when or if this merger deal goes through; it will create the biggest airline by passenger traffic. Though United would still be bigger if its regional United Express affiliates are counted. United, of course, is fresh off its merger with Continental that made it the world's biggest. United surpassed Delta, which itself moved to No. 1 after its merger with Northwest.
With a merger like this, the potential of monopoly comes into play as with fewer options out there, the US Airways/American Airlines conglomerate could charge colossal rates and fees that passengers would have no choice but the pay because the only other option would be Delta/Northwest, United/Continental and/or other limited-service airlines with limited destinations and/or discount airlines.
If a monoply occurs (whether it be regionally or nationally) US Airways/American Airlines could force the other airlines out-of-business and buy them on the cheap.
It is for this reason that even with an announcement later this week or in the up-coming weeks that a deal has been reached, the merger itself would not become official until an extensive review by the Federal Aviation Administration (FAA).
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