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American Airlines, US Airways merger could help Roanoke
Because the airlines don't compete with each other in Roanoke, officials expect no loss of flights.
The Roanoke Times | File September
A traveler makes her way through the downstairs area of the Roanoke Regional Airport.
Friday, February 15, 2013
The $11 billion merger of American Airlines and US Airways to form the world's biggest airline could make it easier for Roanoke area fliers to get to more places without some of the costs people elsewhere fear.
Since American doesn't serve Roanoke, there's a good chance this area will miss the fare hikes and service cuts some analysts predict will result from the merger.
"I wouldn't expect there'd be a lot of change in the Roanoke market," said Vijay Singal, a professor of finance at Virginia Tech whose research on airline mergers was regularly consulted by the U.S. Justice Department.
He said it's unlikely that the merged airline would cut flights here or boost fares significantly.
And the combination probably will make it easier for Roanoke fliers to connect to long-haul flights, he said.
But people who live in markets where American and U.S. Airways compete - or in which one of the two airlines might have feared the other could compete - may not be as lucky, he said. Fare increases and reductions in the systemwide number of flights usually follow airline mergers.
American brings a dominant position in the western United States, as well as in the Caribbean and Latin America, areas where Roanoke businesses are eager for better service, said Sherry Wallace, manager of marketing and air service development at Roanoke Regional Airport.
American also would bring access to a second international airline alliance, Oneworld, a group of 14 giants including British Airways, Qantas and Japan Air Lines that coordinate service and fares, she said.
"This just opens up more options," Wallace said.
She was already set to meet US Airways officials later this month, during which she planned to pitch for service to Washington's Dulles International Airport. Now, she said, she's also going to ask for a link to Miami, where American has a hub with flights to Latin America, a market many Roanoke business people are eager to get to.
"We're not planning to cut any airports, and think the merger will eventually mean expanded service at airports like Roanoke's," said US Airways spokeswoman Liz Landau. But, she said, the airline has no immediate plans for expansion.
The merged airlines plan to maintain US Airways' hubs at Charlotte, with its seven daily connections to Roanoke, and Philadelphia, with its three daily connections.
But while the two airlines say they don't plan to cut any hubs, analysts are skeptical and many mayors are worried.
The American-US Airways merger would create an airline with some 6,700 daily flights and annual revenue of roughly $40 billion. The combined carrier will be called American Airlines.
The deal is expected to close by the end of September, as part of American's emergence from bankruptcy.
AMR shareholders are poised to get a 3.5 percent stake in the new airline. That's unusual because stockholders typically get wiped out in a Chapter 11 proceeding. AMR CEO Tom Horton said AMR's bankruptcy creditors might be repaid in full.
The Associated Press contributed to this report.
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