CHARLOTTE, N.C. (TheStreet) -- A merger between US Airways (LCC) and one of the Big Three airlines "is a pretty high probability for the end game" of major airline consolidation, while the chance of merging with a smaller carrier is near zero, said US Airways president Scott Kirby at a May 27 meeting with pilots in Charlotte.
The rationale, he said, is that if regulators approve the planned merger between United and Continental, the combined carrier would have a 22% share of the domestic market -- the same percentage that Delta currently holds, while American has an 18% share.
"None of those are anywhere close to dominant market shares," said Kirby. "We'll be about 8%. We could merge with any one of those [three]. At most, you take Delta or United up to 30%. That still leaves a very competitive vibrant industry and one of the industries that's most competitive today."As for a merger with a smaller carrier or a low-cost carrier, Kirby ticked off the reasons why it won't happen. Regarding JetBlue (JBLU), he said: "[It] is profitable today or works today because they have much lower costs than us, which is mostly a seniority issue. Put our cost structure on JetBlue and they lose a ton of money."
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