Fri, May 16, 2008
Talks Continue As Airline Also Courts US Airways
Numerous news reports
citing unidentified sources close to the talks insist United
Airlines is still in talks with US Airways about a merger. But it
appears United may be hedging that bet.
The Associated Press cites anonymous sources in a new report
that says United is in discussions with Continental Airlines about
forming an alliance to gain some benefits of working together
without going through a merger. As ANN reported, Continental
rejected a straight-up merger with United last month.
AP's source was described as a person not authorized to speak on
the matter, but was quoted as saying United would pursue either a
merger with US Airways or an alliance with Continental, but not
both.
United is still pushing ahead with negotiations aimed at a
combination with US Airways Group Inc. but would not pursue both
deals, said the person, who was not authorized to speak about the
matter and requested anonymity. That source added a UAL Corp board
meeting scheduled for Thursday was not expected to include a vote
on which course to take.
United, Continental and US Airways have all declined official
comment on a merger or alliance involving United... but last month,
British Airways publicly confirmed talks of adding Continental to
its existing marketing alliance with American Airlines.
Independent airline consultant Bob Mann played down the odds of
United joining an alliance with Continental. "The United guys are
very much heading in the direction of something that will really
allow them to downsize the airline. We're talking about large
capacity cuts. ... The alliance doesn't get to the point where you
can really do the capacity-cutting."
Combining United and US Airways would create a carrier big
enough to give a merged Delta-Northwest a run for the title of
world's largest airline.
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