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US Airways bids $8b for ailing Delta
US Airways Group Inc. launched an $8 billion hostile bid for bankrupt Delta Air Lines Inc. yesterday, a move that could shake up the Boston-New York shuttle market and make the newly combined airline the dominant carrier at Logan International Airport by far. () |
Q. What impact could this merger have on fares?
A. It looks more likely that they would rise or hold steady, rather than fall.
US Airways' chief executive, Doug Parker, said he plans to reduce overall capacity by 10 percent if the deal goes through, which would mean fewer seats and fewer tickets -- and, therefore, higher prices.
However, most of the consolidation would happen on East Coast routes that are now well served by low-cost competitors such as AirTran Airways, JetBlue Airways, and Southwest Airlines. They would keep pressure on the new airline's fares.
Q. What would happen to my US Airways Dividend Miles or Delta SkyMiles?
A. All indications are they'd be honored by the new airline, and you'd be able to cash them in for flights to far more destinations -- a total of 350 cities on five continents. And if you hold miles in both programs, they'd be added together.
Executives say they have not decided, though, whether the new airline would be part of the SkyTeam Alliance, which lets you also use miles on Continental, Northwest, Air France, AeroMexico, and Alitalia, or whether it would stay with US Airways' Star Alliance, which lets members use miles on United, Air Canada, Lufthansa, Scandinavian, and other international carriers.
Q. How could the merger change where I make flight connections?
A. Flying from New England to the west, you'd most likely change in Salt Lake City (Delta's current Western hub) for flights to cities in the Northwest, and in Phoenix (US Airways' hub) for flights to the Southwest.
Going southbound, the new airline would try to fly bigger jets into Atlanta (Delta's hub) and use Charlotte, N.C., for smaller planes.
Overall, New Englanders would probably make more connections in Atlanta and fewer in Charlotte, compared with today's Delta and US Airways operations.
Q. How would the merger affect airline employees?
A. They might get raises, and they won't be laid off. US Airways is promising that in every job classification -- flight attendant, mechanic, pilot, and so on -- everyone will get paid at the highest of the three pay scales under current contracts in force for employees of US Airways, Delta, and America West, which US Airways began merging with last autumn.
No layoffs or furloughs are planned.
Q. Where would the new airline operate at Logan?
A.That's undecided. But airport officials can envision US Airways moving into the half-empty $500 million Delta Terminal A and running the New York and Washington shuttles from the gates closest to check-in, as the Delta Shuttle does today.
That could open up several gates in Terminal B for expansion-minded carriers like AirTran and Spirit or, conceivably, Southwest, which has avoided high-cost Logan in favor of serving this market from the Providence and Manchester airports.
-- PETER J. HOWE ![]()