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A bipartisan pair of senators sent a letter to the CEOs of United Airlines and American Airlines expressing concerns about the possibility of a proposed merger between the two air carriers and requested more information about the impact of a possible deal.
The letter was sent by Sens. Elizabeth Warren, D-Mass., and Mike Lee, R-Utah, who wrote that a merger between United and American would “combine two of the ‘Big Four’ U.S. airlines into an ‘industry behemoth,’ controlling nearly half of the U.S. market share of the airline industry and creating the largest airline on the planet by revenue.”
“Any proposed merger between United Airlines and American Airlines raises serious questions under antitrust law and raises the likelihood of harm for American consumers,” Warren and Lee wrote.
The letter comes after a report that United CEO Scott Kirby proposed a merger with American and asked for the blessing of President Donald Trump on the proposed deal at a late February meeting, according to Reuters. The outlet reported that a source close to the White House was skeptical about the deal’s competitive impact and how it would affect consumers.
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If a potential merger between the two airlines were to move forward, it would likely invite regulatory scrutiny from federal agencies as well as antitrust panels in Congress, such as the Senate subcommittee chaired by Lee.
In their letter, Warren and Lee expressed a number of concerns surrounding the potential for the combined company to raise prices on consumers, hurt smaller airlines’ ability to compete for gate access, and cut routes – particularly those out of Dallas Fort Worth International Airport and Chicago O’Hare International Airport.
UNITED AIRLINES CHECKED BAG FEES CLIMBS $10-50 AS FUEL PRICES NEARLY DOUBLE SINCE IRAN WAR
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| AAL | AMERICAN AIRLINES GROUP INC. | 12.24 | -0.54 | -4.23% |
| UAL | UNITED AIRLINES HOLDINGS INC. | 98.91 | -2.89 | -2.84% |
They also raised concerns about job losses at a combined airline and creating monopsony power that results in the company “potentially suppressing wages and benefits industry-wide.”
Warren and Lee asked the CEOs of United and American to provide answers as to whether the companies have discussed a deal directly or with other outside parties. They also asked the airlines to justify how such a merger would be in the public interest, along with specific queries about air fares and fees, job losses and the elimination of routes under a merger.
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American Airlines said in a statement on Friday that it is “not engaged with or interested in” merger discussions with United.
“While changes in the broader airline marketplace may be necessary, a combination with United would be negative for competition and for consumers, and therefore inconsistent with our understanding of the Administration’s philosophy toward the industry and principles of antitrust law,” the carrier said. “Our focus will remain on executing on our strategic objectives and positioning American to win for the long term.”
United Airlines declined to comment on Friday.
FOX Business’ Robert McGreevy and Reuters contributed to this report.
