Continental and United Airlines Tie The Knot, Say I Do. Will it Work.
It seems the final I do’s or at least I promise to try have been spoken in the long and somewhat rocky courtship between Continental Airlines and UAL Corp’s United Airlines creating the biggest airline in the world. It will surpass Delta Air Lines in terms of the number of passengers carried.
The talks stalled in 2008 when Continental’s CEO Larry Kellner squashed the deal either because of excessive caution or fear about United’s financial situation.
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But all that being said, the new super airline will be called United, it will be based in United’s hometown of Chicago, and run by Continental CEO Jeffery Smisek, with United CEO Glenn Tilton as chairman.
The 3.2 billion dollar deal will shrink a troubled industry, doubtless driving up fares. But the thinking is that the combined resources and staying power of a combined airline will be greater than either one going it alone, and the move will stave of low-cost airlines’ incursions into prized routes.
But that’s not the end of the story.
Several comments on a post on USA Today in the Sky, said that integrating maintenance records, fleet standardization, IT, will take decades, and the move to merger is not a good one.
One big problem will be the culture clash between the two airlines because most of United’s staff lost their pensions and benefits during the airline’s bankruptcy, and Continental’s didn’t.
And the marriage has other ill-wishers: Some pilots.
KTRK-TV in Huston, Texas reports a lot of anxiety about lost jobs because the new airline will be headquartered in Chicago. Many of Continental’s Huston employees are scared.
United’s pilot union, headed by Captain Wendy Morse, says her union is in favor of the merger, “if such a transaction would benefit the careers and futures of our pilots.”
But the TV station reported that several Continental pilots, who didn’t want their names used, expressed concern about the leadership of Continental’s CEO, Jeff Simsek, who would head the combined venture. “If they’re not willing to bring labor into the loop to work out contract issues and seniority and all that, I think it’s going to be a torpedo straight to the bottom,” said one pilot.
In Europe British Airways is moving toward a merger with Iberia, causing airline and travel observers to listen for the other shoe to drop in the form of still more airline mergers.
How do you think the Continental-United merger will change your travel plans?
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