Will Increased Support Push the US Airways-American Airlines Merger Through?
Despite the Department of Justice’s continued objection to a merger between AMR Corp.’s (AAMRQ.PK) American Airlines and US Airways (NYSE:LCC), the two airlines continue to collect support in hopes that the government agency will change its mind.
The newest wave of support for the merger comes from the leaders of 26 Chambers of Commerce and other economic groups, USA Today reports. As a group, the leaders have asked U.S. Attorney General Eric Holder to end the Justice Department’s obstruction of the deal. The letter include the signatures of CEO of the Los Angeles Area Chamber of Commerce, the head of the Greater Boston Chamber of Commerce, the CEO of the Pennsylvania Chamber of Business and Industry, and the CEO of the Virginia Chamber of Commerce.
The letter came only one day after the the mayors of seven major U.S. cities sent Holder a letter calling the Justice Department’s continued efforts to block the deal “ill-conceived” on Wednesday. Signing the letter were Patsy Kinsey of Charlotte, Rahm Emanuel of Chicago, Mike Rawlings of Dallas, Betsy Price of Fort Worth, Carlos A. Gimenez of Miami-Dade County, Michael Nutter of Philadelphia, and Greg Stanton of Phoenix.
The mayors’ letter said to Holder, “Without this merger, American and US Airways will be at a permanent competitive disadvantage to Delta and United, each of which has been allowed to build superior route networks through mergers that were cleared by the Justice Department, the latter under your watch.”
Similarly, the business groups’ letter cited the mergers by United, Delta, and Southwest as a reason the American Airlines-US Airways deal should be allowed to move forward, arguing that “the new American will be a better airline with a solid financial foundation.”
According to the business leaders, “the new American will be able to compete effectively with Delta, United, Southwest, and the ever-increasing number of smaller carriers, and the business community will have a more efficient and dependable partner for air transportation needs. More competition in the airline industry will help everyone, even as the new American delivers greater benefits to consumers, businesses, labor, and the local communities it serves.”
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