What American Airlines - US Airways merger means for the traveler

NEW YORK - While American Airlines and US Airways announced plans to merge Thursday, it will be several months -- if not years -- before passengers see any significant impact.

Passengers with existing tickets on American or US Airways -- and members of both frequent flier programs -- shouldn't fret. No changes will come anytime soon.

American's parent company, AMR Corp., is still under bankruptcy protection and will need the court to approve the deal. US Airways shareholders will also have to vote for a merger. Then the Department of Transportation and the Justice Department must sign off. Finally, once a deal closes, the new company could operate two separate airlines for a number of years.

When the airlines finally do merge, here's what passengers can expect:


In the past five years, the airline industry has seen the combinations of Delta with Northwest, United with Continental and Southwest Airlines Co. with AirTran. Further consolidation is likely to raise airfares. The price of a domestic round-trip flight has climbed more than 11 percent since 2009, when adjusted for inflation, according to the Bureau of Transportation Statistics.

The merger will give a combined American and US Airways Group Inc. the ability to increase fares. United, Delta and Southwest would be likely to follow. Although it could also pave the way for further expansion by discount airlines such as Spirit Airlines Inc. and Allegiant Travel Co.


Your miles will be safe. After the merge is approved, the two airlines will likely combine the miles into one program and elite status from one airline will likely be honored on the other. That puts the occasional traveler closer to rewards.

The merged carrier will continue American's participation in the OneWorld alliance, which was founded by American, British Airways, Cathay Pacific and Qantas. Today, it has 12 airlines including Finnair, Royal Jordanian and Japan Airlines. US Airways will leave the Star Alliance, which includes rival United Airlines, Lufthansa, Air Canada and 24 other airlines. Alliances allow passengers to earn and redeem miles on partner airlines.


A key reason for merging is to link both airlines' networks, creating a system on par with Delta Air Lines and United, part of United Continental Holdings Inc.

There is little overlap between the two airlines' existing routes. The combined carrier will offer more than 6,700 daily flights to 336 destinations in 56 countries, making it more attractive to companies seeking to fly employees around the globe with few connections.

US Airways passengers will gain access to American's international destinations, particularly London and Latin America. American's passengers will be able to better connect to smaller U.S. cities that US Airways serves.

The combined carrier will have considerable presence in New York, Philadelphia, Washington, Charlotte, N.C., Miami, Chicago, Dallas, Phoenix and Los Angeles. It is unclear how many of those cities will keep their levels of service. In past mergers, airlines have promised not to close any hubs but have gone ahead and dramatically reduced service in once-key cities.


The merger of two airlines often means confusion and hassle for customers. Which terminal or ticket counter do they go to for check in? If there is a problem with a ticket, which company should they call? For a while, United and Continental were issuing two confirmation numbers for each ticket so either airline's staff could make changes. Problems with the integration of their frequent flier programs angered many loyal road warriors and computer glitches caused repeated flight delays. It could be months, if not years, until all American and US Airways planes get a uniform paint job.

"These things are never as seamless as they seem," said Thomas Lawton, a professor of business administration at Dartmouth College's Tuck School of business. "There will probably be some initial teething problems."


1930: American Airways Inc. is incorporated. The name changes to American Airlines Inc. in 1934.

1937: American carries its one-millionth passenger.

1939: The company's shares begin trading on the New York Stock Exchange.

1945: Flights to Europe begin under the American Overseas Airlines brand. AOA later merged with Pan Am.

1948: The airline offers scheduled coach service at lower prices than first-class.

1953: American began nonstop, coast-to-coast flights on the Douglas DC-7.

1959: American offers transcontinental jet service on the Boeing 707.

1977: American introduces the "Super Saver" fare.

1979: The airline moves its headquarters from New York City to Fort Worth, Texas.

1981: The AAdvantage frequent-flier program is born and eventually becomes the model for loyalty plans at other big airlines.

1982: Shareholders approve a reorganization plan that creates parent

AMR Corp.

1985: Robert L. Crandall becomes chairman and CEO.

1991: American carries its one-billionth passenger.

1998: Crandall retires and is succeeded by Donald J. Carty.

1998: American acquires low-cost Reno Air; pilots later conduct a costly sickout in protest.

2001: American acquires assets of bankrupt TWA; the deal eventually leaves American saddled with old planes and too many employees. On Sept. 11, two American Airlines jets and two United Airlines jets are hijacked by terrorists and crash.

2003: With the company on the brink of bankruptcy, Gerard J. Arpey replaces Carty as CEO; labor unions approve cost-cutting contracts that let AMR avert bankruptcy.

2008: American fails to reach new contracts with union employees, who continue to work under terms of previous agreements.

2009: American announces "cornerstone" strategy of focusing on five big U.S. markets -- Dallas-Fort Worth, Chicago, Miami, New York and Los Angeles -- while downplaying others.

2010: AMR reports a loss of $471 million, bringing total losses since 2001 to more than $10 billion.

2011: AMR, American Airlines and other subsidiaries file for bankruptcy protection on Nov. 29, a day after Arpey retires and is replaced by Thomas W. Horton.

Feb. 1, 2012: American tells workers that it plans to cut 13,000 union jobs, mostly in the maintenance division; the number is later reduced sharply.

April 20, 2012: US Airways announces that it has reached labor agreements with all three of American's unions on contracts that would take effect in case the two airlines merge.

July 10, 2012: Horton, who had resisted US Airways' merger overtures, says AMR has made enough turnaround progress to now consider merger options.

Aug. 31, 2012: American announces that it has signed an agreement to exchange confidential financial information with US Airways so that the two can study a potential merger.

Sept. 4, 2012: A federal bankruptcy judge reverses his earlier ruling and lets American cut pay and benefits for pilots, who had rejected the company's last contract offer. The decision is followed by a surge in canceled and delayed flights, which American blames on an illegal work slowdown by pilots.

Oct. 2, 2012: American and the Alllied Pilots Association agree to resume contract talks; all other union groups have accepted cost-cutting contracts.

Feb. 13, 2013: The boards of American and US Airways approve a merger creating the world's biggest airline.

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