By Elliott, Christopher
Newsweek , Vol. 161, No. 07
Byline: Christopher Elliott
When airlines merge, who wins?
The mass cancellations of flights along the East Coast in the face of a ferocious blizzard earlier this month once again fixed travelers' attentions on the chronic problems of airline customer service, and so it may not have been the best moment for American Airlines and US Airways to announce a merger, a move that will create the largest airline in the country--and possibly, the most-complained-about one.
News of the agreement to combine the two carriers into a single, $11 billion company, operating under the American Airlines name, raises the question: is bigger really better? American is set to emerge from bankruptcy protection soon, and executives at US Airways have been desperate to acquire another airline since they led tiny America West's takeover of US Airways in 2005. What remains to be seen now is if the combination of the two legacy carriers will be a win for customers.
"The merger was inevitable," says Timothy O'Neil-Dunne, an airline consultant and frequent traveler based in Redmond, Washington. "But it was not desired." O'Neil-Dunne says that's especially true for passengers, who can't seem to answer the question: what's in it for us?
The companies have answered that question only vaguely, saying the transaction will combine their complementary flight networks, increase efficiency, and offer "more options" for customers. The result, it added, would be a competitive global airline with a superior breadth of schedule to "high value" travelers, which is corporate-speak for business travelers and elite-level frequent fliers.
One reason some customers are skeptical is that when it comes to service, neither airline is a star. The latest American Customer Satisfaction Index gives American a score of 63 out of 100 for service, while US Airways ranked just 1 point higher. Both companies also receive a higher-than-average number of customer complaints, according to government statistics. The airlines insist better days are ahead.
An American executive said a recent rebranding effort, which includes new livery, logo, and uniforms, is more than skin-deep. …