It has been five years since American Airlines could say, “We’re No. 1.”
But when its merger with US Airways closes in December, the Fort Worth, Texas-based airline can once again claim the top spot in the airline industry.
The new American will have more than $38 billion in annual revenue, 1,500 aircraft, 6,500 daily flights and more than 100,000 employees, making it bigger than rivals United Airlines and Delta Air Lines, which currently occupy the top two positions.
Executives at the new American say its added size will help it compete for lucrative business travelers and provide more connections to more destinations for all travelers.
“This makes us a very powerful global competitor, not just with United and Delta but also with all the growing international airlines around the world,” American’s chief executive Tom Horton said in November, after the carrier settled its antitrust lawsuit with the Justice Department. “We think the U.S. should have the world’s leading airline, and that’s what’s been created here.”
Being the biggest, however, may not have the same cachet in the airline business that it used to, industry analysts say. The top three airlines are very close in revenue and network size, all serving over 300 destinations worldwide.
Each carrier will have its own geographic strengths, and product and service offerings. But in reality, all three airlines will be able to take a customer from one destination to another, whether it’s on their own planes or an alliance partner’s flights, said Henry Harteveldt, airline analyst at Hudson Crossing.
At Denver International Airport, the carrier will carry only a fraction of the passenger traffic.
“It is not a matter of being the largest airline,” Harteveldt said. “It’s a matter of how intelligent its leadership is in making the largest airline the most relevant.”
When American’s parent company, AMR Corp., filed for bankruptcy court protection in 2011, the carrier had lost market share on both coasts and cut flights out of Boston.
The merger with US Airways will create a combined network with more capacity in New York and Washington, D.C., even after the divestitures required by the settlement with the Justice Department.
“It has more of the top 10 cities and more of the top premium markets as hubs within the United States,” Harteveldt said. “The potential to use both Chicago and Philadelphia as connecting gateways across the Atlantic and use New York for local traffic may help their business.”
