US Airways/American Merger Could Bring Job Cuts

Tempe, AZ-based US Airways Group may announce a merger with bankrupt carrier American Airlines this week.  The combined airlines would surpass United Continental as the world’s largest airline. US Airways’ CEO Doug Parker, who has been in talks with AMR since last January, is expected to lead the combined companies, while American’s CEO Tom Horton would become non-executive chairman, according to sources who spoke with Bloomberg News. The attempted merger comes after an unsuccessful bid to combine with Delta Air Lines in 2007. If successful, this merger will further consolidate an industry hit hard by the global economy and government regulations and could pave the way for the possibility of higher fares and more routes. The industry has seen five large mergers since 2001, including the May 2010 merger of United and Continental, costing 1,500 jobs in 2011. This, like other mergers, could also cost jobs: American Airlines announced 13,000 job cuts last February after seeking court protection. Airlines and airport/airline services companies announced 29,273 job cuts in 2012, according to tracking by global outplacement Challenger, Gray & Christmas, Inc. So far this year, job cuts at airlines total 1,281. How might this merger impact airline and air travel employment? How may the consumer be affected? What other industries could see major mergers?


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