|AA, US Airways to Announce Merger|
|By LISA STARK (@LisaStark)||Feb 13, 2013, 5:17 PM|
They've been dating for a year, and now it looks as though the marriage of American Airlines and USAirways will be announced tomorrow, according to a source close to the negotiations.
Sources tells ABC News that details of the merger agreement have been worked out.
The two airlines' Boards of Directors have approved the deal Wednesday evening, according to a source close to the negotiations.
If the two carriers merge, they are expected to retain the American Airlines name. The new airline would become the largest in the world.
Any deal is still subject to approval of the bankruptcy judge overseeing American Airline's bankruptcy, as well as the anti-trust division of the Department of Justice. Both are expected to sign off on the agreement.
This would be the third mega airline merger in the past five years. Delta and Northwest announced a merger in 2008, followed by United and Continental in 2010. The industry consolidation would leave four major carriers operating in the U.S., American, Delta, United, and low-coast carrier Southwest.
For travelers, nothing will change immediately.
These complicated mergers can take more than a year to accomplish. Will this ultimately mean higher fares for travelers?
Some analysts believe fares won't be greatly impacted, because American and USAirways don't compete now on many of their routes.
But ABC News Travel and Lifestyle Editor Genevieve Shaw Brown says less competition among airlines generally means higher prices for consumers.
Rick Seaney, CEO of FareCompare.com agrees, telling ABC News that a merger "guarantees these two airlines will never compete in the future, and competition is the main driver of cheaper airline ticket prices."
One thing travelers won't have to worry about is their coveted frequent flyer miles. The airlines will merge their two frequent flyer programs, and the larger route system will give passengers more opportunity to earn those miles.
Airline mergers can be messy affairs.
Brown notes that when United and Continental merged there were major computer glitches that virtually shut down their systems.
The biggest problem with most mergers, though, is consolidating employees and employee contracts. In this case, deals have already been worked out with pilots, flight attendants and mechanics, which will help ensure smoother sailing when and if the airlines combine.