Denver may be able to reap the benefits of the United-Continental merger and not pay as heavy a price as other locales, observers said Monday.
“The good news is this shouldn’t be a terrible thing,” said Andrew Goetz, a University of Denver geology professor whose research focuses on air transportation. “This will keep United alive and provide Denver travelers who need to go overseas with wider destinations.”
Keeping United healthy is important to Denver, where it has about half of the market share.
Goetz said it is less likely for airfares to rise in Denver than elsewhere because of the strong presence of low-cost carriers.
Southwest is expanding Denver service, and Frontier has its hub here and is growing now that its branding decision has been made.
The impact on airfares “won’t happen tomorrow,” said Mac Clouse, a DU finance professor. “And we may even see some reductions in airfares here. Places like Boise and Des Moines and Wichita had better watch out, though.”
The proposed merger may open the door to low-cost carriers or new discount airlines to serve areas the new United may not want, Clouse said.
Denver will get better access to the nation’s Southeast with the deal, said Tom Clark, executive vice president of the Metro Denver Economic Development Corp.
“And Continental gives us tremendous access into South America, which is a growing market, albeit a little unpredictable,” Clark said.
He did fret about the impact on the long-term effort to entice All Nippon Airways into choosing Denver for a nonstop Tokyo route.
With the Continental and United connections to the world, particularly Asia, Clark said the question is “if ANA (All Nippon Airways) flies into Denver, is that the same or better than flying into Houston as a new codeshare partner?”
Business travelers will have more options with the merger, said Robert Polk, president of Majestic Polk Travel, which specializes in business travel.
“Between the two of them (United and Continental) and Lufthansa, you’ll be able to get anywhere on the globe,” Polk said.
No changes are proposed yet at DIA.
“We need to talk with the airlines and see what their plans are,” airport spokesman Jeff Green said. “It will be a while before we see an impact here.”
Ann Schrader: 303-954-1967 or aschrader@denverpost.com
Chronology: United and Continental airlines
April 6, 1926: Entrepreneur Walter Varney launches a contract air-mail service in Boise, Idaho, with a company that would become United Airlines.
March 28, 1931: United Air Lines Inc. incorporates.
1934: Varney and partner Louis Mueller found Varney Speed Lines, the earliest predecessor to Continental. The first flight, on July 15, goes from Pueblo to El Paso, Texas, with stops in Las Vegas, N.M.; Santa Fe; and Albuquerque.
1936: Robert F. Six buys a stake in Varney. He changes the name to Continental Airlines in 1937 and leads the company for more than 40 years.
1982: Continental combines with Texas International, led by Frank Lorenzo, and offers flights to four continents.
1986: Continental emerges from bankruptcy protection. It would file for bankruptcy again in the 1990s.
1987: Continental swallows Frontier, People Express and New York Air.
July 12, 1994: United shareholders approve an employee stock- ownership plan.
Sept. 11, 2001: Two United airplanes are among the four hijacked and crashed by terrorists.
Sept. 20, 2001: Continental and others begin furloughing thousands of employees during the downturn that follows the terrorist attacks.
Feb. 1, 2002: United announces a $2.1 billion loss for 2001, a record for any airline.
Dec. 9, 2002: United files for Chapter 11 bankruptcy protection.
Jan. 21, 2003: Continental, Northwest and Delta announce an alliance.
Feb. 1, 2006: United emerges from bankruptcy protection after slashing labor costs by more than $3 billion.
April 27, 2008: Continental says it will not pursue a merger with United.
Oct. 27, 2009: Continental joins United in the Star Alliance, one of three major teams of global airlines, leaving the SkyTeam alliance that includes Delta.
April 2010: United and US Airways break off merger talks; talks between United and Continental resume.
May 3: United and Continental announce a $3.2 billion merger under the United name.
Sources: Public records, AP archives, company websites
