Translated material
United Airlines
Largest airline still in America
The US Department of Justice announced that it no longer opposes the merger of two American airlines, which would create the largest carrier on the planet. Although the deal between United Airlines and Continental Airlines must still be approved by shareholders as well as the US Department of Transportation, it is expected to close by October 1.Two large but unprofitable players in the American air transport market, United and Continental, entered into a merger agreement in early May of this year. The merger would create an airline that carries 144 million passengers annually to 370 destinations around the world, based on Continental and United's combined data for last year. Based on certain statistical indicators, it can safely be called the largest air carrier in the world. This title now belongs to the American airline Delta - more than 160 million passengers in 2009. However, if you count not just passengers, but passenger traffic, then the new United, which has longer routes overall, will be ahead of Delta. The merged company will retain the name from the “old” United, and the coloring of the aircraft with a stylized image of a globe on the tail from Continental. It is assumed that the current chairman of the board of directors of Continental, Jeff Smisek, will become the head of the merged airline.
Experts from the two companies estimate that by reducing personnel, fleet and overhead costs, this operation will save the new alliance more than a billion dollars annually. United ended last year with a net loss of just $1 billion, and Continental lost $282 million. Because the deal needed approval from both companies' shareholders as well as government regulators, the initiators then expected to complete it by the end of the year. However, so far the process is going even faster than they expected. The US Department of Justice, having examined the agreement from a competition perspective, did not raise any objections except one. At Newark Airport, New York's third-largest gateway, United already carries 70.9% of its passengers. Continental also flies to Newark, although not as intensively. By uniting, the two companies will completely crush their competitors at this airport, the Ministry of Justice considered. He also suggested a way out of the situation: to give away part of the slots (time slots for takeoff and landing) to a third airline. United shared its slots with Southwest, which has not yet flown to Newark.
On Friday, the Justice Department announced that it no longer has any objections to the United-Continental merger. The organizers of the deal did not get this permission at a very high price. The two companies together now operate 442 round-trip flight pairs to Newark each day. And Southwest received from them slots sufficient to organize 18 such paired flights, and even then only by June 2011.
Meetings of shareholders of Continental Airlines Inc. and UAL Corp (United's management company) are set for September 17 to approve the merger. After this, the deal must still be approved by the US Department of Transportation.