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Article Excerpt
Some corporate travel buyers expect Delta Air Lines' merger agreement with Northwest Airlines to inject a bit of health into a struggling domestic industry, but many expect it to prompt more consolidation, diminish competition, reduce declining U.S. capacity and further degrade customer service.
Following months of speculation and reported false starts, Delta and Northwest on April 14 publicly proposed to create the world's largest airline through an all-stock merger deal, valued at $17.7 billion. Contingent on shareholder and regulatory approval, the merged airline within eight months plans to begin integration and relaunch under the Delta Air Lines name, with former Northwest CEO and current Delta CEO Richard Anderson at the helm.
"From my perspective, it's a two-edged sword," said Lockheed Martin director of corporate travel services Richard Wooten. "Somehow they need to get healthy, and maybe this is what it takes, but on the other hand, this will limit competition and may harm smaller markets."
Other buyers shared similar concerns in a National Business Travel Association survey conducted prior to the...
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