Justice Department is right to block US Airways-American merger

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Better late than never, the Justice Department filed suit Tuesday against a giant airline merger that threatens America's air travelers. The flying public should be grateful.

The proposed combination of US Airways with American Airlines would not only hurt Pittsburgh, which has been par for the course at US Airways, but it would also reduce competition nationwide, raise fares and put too much of the industry in the hands of too few players. The plan was set to go before a bankruptcy court judge on Thursday, with executives at both carriers hoping for a quick approval that would let them complete the consolidation in the third quarter.

The Justice Department wisely intervened, however, saying the merger would hand over control of 80 percent of the U.S. market to four airlines. At key airports across the country, the bulked-up carrier would enjoy near monopolies on service. It would own 63 percent of the market at Reagan National Airport in Washington, 70 percent at Miami, 86 percent at Dallas and 92 percent at Charlotte, N.C.

Pittsburgh would suffer fallout as well. After Allegheny County built Pittsburgh International Airport to US Airways' specifications and opened the $1 billion terminal in 1992, the airline's traffic and employment here made it a thriving hub. Then as the airline went through two bankruptcies after 9/11, it unceremoniously dropped Pittsburgh as a partner, stripped it of hub status and shifted its connecting flights elsewhere -- Philadelphia, Washington, Charlotte, Phoenix.

Pittsburgh went from a peak of 633 nonstop flights to 114 destinations, down to 155 daily flights to 36 locations in 2012. At one point 12,000 people in the region made a living from US Airways; by last year only 1,800 were on the payroll.

The next indignity from Pittsburgh's estranged suitor could come with this merger. From the moment the proposal was announced, analysts saw US Airways' $32 million state-of-the-art operations center in Moon as vulnerable. Forget that it was built by the public, again to help the airline, with $3.75 million in state grants and tax credits. The work of the center could be moved to Dallas-Fort Worth International Airport, where American Airlines is based.

Also subject to transfer is Pittsburgh's maintenance work, which focuses primarily on narrow-body Airbus jets. More than 1,600 people are employed in the maintenance and control operations here, and Doug Parker, the US Airways chief who would become CEO of the world's largest airline under this move, is not about to let fidelity to Pittsburgh stand in the way of an industry trophy wife.

Yes, the Justice Department has it right -- and so does Pennsylvania Attorney General Kathleen Kane, one of six state attorneys general to join the lawsuit. The merger of US Airways and American is not good for the country. Just look at what one airline's zeal for dominance did for the people who helped it survive and grow.

US Airways began as Allegheny Airlines, remembered by some as "Agony Airlines." In this merger, there's no Allegheny and too much agony.


First Published August 16, 2013 12:00 AM


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