Tuesday, May 11, 2010

Report: Antitrust Issues Small in United-Continental Merger, But Potential Market Domination at 17 Airports, Many in California, Needs Attention

A report from Cambridge Aviation Research today has some interesting analysis on the consumer and antitrust effects on the proposed United-Continental merger. Here's a summary of the report.

"With relatively little overlap in their route structures, the proposed merger of United and Continental raises red flags at only 17 domestic airports," says Jeffrey Breen, president of Cambridge Aviation Research and primary author of the report.

Last month, Cambridge said, a study of a then-proposed merger of United and US Airways identified 26 red-flagged airports.

In the proposed United-Continental combination, the 17 airports red-flagged as at risk for increases in market concentration that exceed federal antitrust guidelines are (from most-affected to least): the hilariously named Newark Liberty International Airport; San Francisco; Vail; the preposterously named Houston George Bush Intercontinental Airport; Los Angeles International; Yampa Valley Colorado; New Orleans; Cleveland; Denver; Chicago O'Hare; San Diego; Orange County; Honolulu; Ontario California; Las Vegas; Tampa; Sacramento.

More than a third of the red-flagged airports are in California, and management of the airlines should "address these markets proactively and publicly," Breen says.


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