New York: A merger between UAL's United Airlines and Continental Airlines would create the largest US carrier on routes across the Atlantic and Pacific where business fliers pay some of the industry's highest fares.
The companies together would surpass Delta Air Lines for the top spot in the US industry across the Atlantic, with 40 per cent of the passenger traffic, and grab 53 per cent of traffic across the Pacific, where United already leads, based on data compiled by Bloomberg.
Tie-up talks
UAL and Continental are holding talks on a tie-up, a person with direct knowledge of the meetings said on April 15. Broader networks help funnel in more travellers and attract corporate customers who fly between airports such as San Francisco and Tokyo's Narita, or Newark, New Jersey, and London's Heathrow.
"A combined United-Continental would be No. 1 in trans-Atlantic and trans-Pacific and have a significant presence in the key New York region, Chicago, Houston and Los Angeles," said Jeff Straebler, fixed-income strategist at RBS Securities in Stamford, Connecticut. "Who else could make a transformative combination?"
The talks between United, the third-biggest US airline by traffic, and No. 4 Continental may derail United's discussions about a merger with US Airways Group.
Blending the route systems of United and Houston-based Continental would produce two hubs at US East Coast business centers, United's at Washington Dulles and Continental's at Newark. Chicago-based United's routes include flights between Washington and Moscow, a city not served by Continental.
United and Continental would take second place in Latin America, narrowing American Airlines' advantage, based on data compiled by Bloomberg.
