Topic of the Week: Southwest/AirTran Merger is Approved

The Department of Justice approved the Southwest/AirTran merger without any changes this week. The DOJ said it had no concerns about an anti-competitive impact from the merger. Do you agree? Are you surprised that it sailed through?

Get Posts via Email When They Go Live or in a Weekly Digest

Leave a Reply

17 Comments on "Topic of the Week: Southwest/AirTran Merger is Approved"

avatar
Sort by:   newest | oldest | most voted
Nick Barnard
Member

Given how Delta and US Airways are having trouble with their LGA/DCA swap, I’m a bit surprised…

That being said, this is Southwest we’re talking about, which the government has an irrational attraction to..

Nick Barnard
Member

Uh, let me finish that thought.. I’m surprised that neither of them had to give up an LGA slot or two. To some upstart, you know Independence Air or someone like that..

David SF eastbay
Member

Unlike some of the other majors that have merged, the airlines did not cover almost duplicate cites. Air Tran flys to a lot of cities that Southwest doesn’t, and Southwest covers a lot of the west which Air Tran doesn’t, so that could have a big impact of getting approval.

Think back to Western and Delta, did they have much trouble? One fly mostly in the west and the other in the east so their wasn’t much to think about as far and one major would dominate a bunch of cities/markets.

DesertGhost
Guest
Based on my observations, there haven’t been many regulatory hurdles thrown up against any recent airline merger. If I remember correctly, the last merger that was stopped was UA/US. The biggest issue with that merger was that both had a large presence in the Washington D.C. market and particularly at DCA which is slot controlled. BWI (not to mention DAL, MDW, LAS, PHX) isn’t slot controlled. The Washington market is much more fragmented now, so WN’s concentration at BWI is less of an issue. “End-to-end” mergers like HP/US, DL/NW and UA/CO seem to have an easier time of it. If… Read more »
Dr. Kenneth Noisewater
Guest
Dr. Kenneth Noisewater
There’s not a whole lot of route overlap between the two airlines. FL’s primary hub is ATL which WN does not serve at all. They both have a big combined share of BWI traffic, but that whole DC/Baltimore market is big enough to support a merged airline and still be open to competition. WN and FL only have a handful of slots at LGA so the combined airline would still be only a smallish operator at that airport. Despite WN’s status as a major airline, I don’t think they’re viewed in the same vein as the legacy airlines when it… Read more »
Sam
Guest

Can someone enlighten me as to what happens after this deal closes? How quickly will we see, for instance, a WN jet in Atlanta? A 717 in WN colors? Do you think we’ll see AirTran flight beginning to be marketed as “Southwest Airlines operated by AirTran”?

Nick Barnard
Member
Well here is the general template for airline mergers: 1. Holding companies merge. Steps 2-6 happen at various times, generally concurrently. 2. Airlines begin to align their service offerings. 3. Airlines start code sharing. This is usually a few months after closing, but given Southwest’s legendary IT problems, it might be longer for them. 4. They start repainting planes at this, although there is always the operating carrier on the outside of the plane until the certificates are merged. (e.g. Southwest Airlines in big text, with a little decal “Operated by AirTran Airways”.) 5. Labor integration happens. This can sometimes… Read more »
chris
Guest

Of course cranky does not like this merger because it will destroy republic airlines. Cranky has a thing for republic for some reason

jr
Member

Well there goes another carrier that give a passenger some dignity and ammenities and makes Southwest, already the “Greyhound of the skys” bigger.
A cheap way to travel if you are traveling on the cheap. I never fly them if the flight is over an hour and a half

KFRC
Member

Bring back National Airlines !!

jr
Member

Yeah NICE ALL FIRST CLASS Just like Southworst

wjboll
Member

My understanding from a friend of mine who does some consulting work in the airline field is that WN is looking to see if they can migrate their IT over to AirTrans system which is has more technology capabilities.

Sean
Guest

Very interesting, that would probably be the easiest way to do it. Maybe buying airtran and their associated reservation system was the cheapest way to move to a new booking system! :)

Jim
Guest
No, I am not surprised. The government doesn’t seem to be the least bit concerned about the overall number of airlines in the US. They just look at individual route pairs. Even if there are route pairs that Southwest will monopolize after the merger, other airlines “could” establish service on those routes. Based on the approvals of the last 3 mega airline mergers, it has become clear what their standards are. In order for the government to object, the following conditions have to be met. 1. the two airlines should be competing on a certain route 2. there should be… Read more »
wpDiscuz