Legacy Carriers Have Urge to Merge

Nevertheless, the industry's two leading voices for consolidation remain undeterred, despite acknowledging during the conference calls last week that the world does not yet see things their way.

While industry CEOs, including Delta's Jerry Grinstein and US Airways' Parker, have suggested that mergers are unlikely in the current environment, United's Tilton said that "consolidation is a strategic imperative in the industry" but that "for me to be able to effect it, I need somebody else to agree with me and to step up," should the opportunity present itself. Over time, he said, that would happen.

"It is a little puzzling to me for someone to think about it in a passive context, as if you had nothing to do with it," Tilton said.

Parker, however, reiterated that it will take a downturn -- or at least "a change in mentality"
-- for consolidation talk to return. "

That's "not because that's when it should happen, but when companies are doing better than they used to, it's hard for boards and management teams to get excited about doing something dramatic because they feel good about the trend," he said.

Carriers emerge from bankruptcy after wiping out shareholders, chopping aircraft lease rates and extracting billions of dollars in concessions from employees. For consolidation to occur, Parker said, those carriers must reach the point where they realize that "our company still isn't doing as well as we would like."

"Some carriers," he said, without mentioning names, "are already there." And others will get to that point, he said.