Airline M&A Spells Access to Asia
CHARLOTTE, N.C. -- While airlines have many reasons to merge, a key one these days is to enhance the value of coveted routes to Asia.
Experts say the Delta-Northwest deal has the more obvious benefit, combining Delta's superior hubs and traffic with Northwest's Asia system, but a United-US Airways deal would push some US Airways passengers to United's Asian network.As Northwest CEO Doug Steenland said at a press conference announcing the deal with Delta, "Northwest is the preeminent airline from the U.S. to Asia, [but] our domestic operation is not optimally sized to support this great Asian access." The merger would bring restoration of Tokyo-New York service, which Northwest suspended in 2005, he said. Meanwhile, a United-US Airways merger, were it to occur, "would bring along a customer database that United doesn't have," says aviation consultant Robert Mann. "But you don't get a spectacular global network, like you do with Delta-Northwest." Looking ahead, however, a United-US Airways deal could build on the strengths of the Star Alliance, and could offer an enhanced relationship with alliance member Lufthansa and perhaps with JetBlue (JBLU), as Star Alliance seeks a stronger presence in the New York market. Lufthansa owns 19% of JetBlue.
A Tight Sky MarketNorthwest and United both hold rights awarded under a 1952 aviation treaty with Japan, which provided two U.S. carriers with the ability not only to fly from the U.S. to Japan, but also to fly beyond Japan into Asia.
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