United Airlines Won't Try Big Merger After American Airlines Says No
CEO says company will focus on buying smaller assets like airport gates instead of whole airlines.
United Airlines will not try to merge with other big airlines anymore after American Airlines rejected their offer earlier this year. The CEO of United Airlines, Scott Kirby, said this during a meeting in Brazil on Sunday. Instead, United might buy smaller things like airport gates or airplane parking spots. This decision comes as airplane fuel prices are getting more expensive and making it harder for some airlines to make money.
Kirby had asked American Airlines about joining together in April, but American said no. American's CEO Robert Isom said the merger would hurt customers and reduce competition. Kirby also talked to former President Donald Trump about this idea in February. But without American Airlines wanting to work together, the plan could not happen.
The United Airlines boss still thinks the merger would have helped customers. He believes workers, people who own airline stock, and passengers would have liked the deal. But he said American Airlines' managers spoke against it in public. Any big business deal like this needs both companies to want to work together.
Higher fuel costs are making it harder for airlines to earn money. Some airlines are stronger and can charge higher ticket prices, while others are struggling. Kirby said United expects to make up for the higher fuel costs later this year by charging more for flights. Even though tickets cost more, people are still buying them and wanting to travel.
Kirby thinks airlines succeed when customers like their service, not just their low prices. He disagreed with critics who say big airlines are pushing out smaller ones unfairly. Instead, he believes United and Delta Air Lines win customers because they spend money on better technology and service. People want a good travel experience, not just a cheap seat.
You can't have the management team on record publicly saying it was anti-competitive.
Comprehension quiz preview
1. What did American Airlines' CEO say about the merger with United?
2. When did Scott Kirby talk to former President Trump about the merger?
3. Where did Scott Kirby make these comments about United Airlines?