Study Says New Uber-Airline Would Likely Spur Increased Prices

An analysis of a possible merger between Delta and either of two competitors rumored to be candidates would be a "game changer." That's the finding of OAGback Aviation Solutions in a study commissioned by USA Today.

The group determined such a merger would greatly extend the reach of the resulting airline, giving it influence over service and fares in more major US markets than any of the three has today.

A Delta-United deal would give the combined carrier a strong position in eight of the 12 biggest US business markets, according to the report. The analysis combines the current shares of each carrier in the big markets, establishing a rough estimate of the share the combined carrier might control.

Either deal would create the nation's biggest airline. Delta-United would have a 25 percent share of all seats on US flights. A combined Delta-United would add up to significant market shares in Boston, New York and Atlanta, where Delta is strong, and in Washington, DC, Chicago, Denver, San Francisco and Los Angeles, where United has hubs.

Delta-Northwest would be only slightly less dominant, at 22 percent of all US seats, and imposing market shares in five of the top 12 US business centers -- Boston, New York, Atlanta, Minneapolis and Detroit.

Either merger would be a good news/bad news mix for business travelers. The good news would be increased clout in penetrating international markets, making business travel more convenient.

The bad news -- two airlines which currently compete for business seats would become allies, with ticket prices likely to rise as a result.

OAGback Aviation Solutions grew from OAG Data, a database company which expects to track 28 million airline departures in 2008, and Back Aviation Solutions, an aviation consulting, forecasting and asset management company. Apparently, these guys are well positioned to talk about mergers.

FMI: www.oagback.com, www.delta.com, www.united.com, www.nwa.com