CASCADE TOWNSHIP, Mich. (WOOD) - American Airlines and US Airways say they're merging in a deal they value at $11 billion, creating the world's biggest airline, the Associated Press reports. The combined carrier will be called American Airlines but run by US Airways CEO Doug Parker. The airlines announced their deal Thursday. It reduces the number of major U.S. airlines to four.
Together, American and US Airways will be slightly bigger than United Airlines. Travelers will not notice immediate changes. It will likely be months before the frequent-flier programs are merged, and possibly years before the two airlines are fully combined.
If the deal is approved by American's bankruptcy judge and antitrust regulators, the new American will have more than 900 planes, 3,200 daily flights, and about 95,000 employees, not counting regional affiliates. It will expand American's current reach on the East Coast and overseas.
Will this merger make airfares go sky high?
"In the long term, there will be less competition, and this is going to raise ticket prices. But in the short term, we're already going to see higher prices," said Rick Seaney of FareCompare.com.
At an airport, such as the Gerald R. Ford International Airport in Cascade Township, where travelers already pay about 21 percent more for tickets than the national average, no one wants to see higher costs.
Travelers can currently use American Airlines at the Ford Airport, but not US Airways.
There is something else that could factor into any future price hikes when it comes to departing from the Ford Airport, and that is Southwest Airlines. The airline recently announced it would replace current Air Tran flights with Southwest flights, plus add more destinations.
"As other airlines compete with Southwest, it's clear that airfares will decline," said Grand Rapids Mayor George Heartwell.
So will the American Airlines and US Airways merger, and the Southwest Airlines modifications, balance each other out? Or will one prove to be right and the other wrong?
That all remains to be seen, but one thing is for sure -- expect to see many changes in the sky this year, especially in West Michigan.
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