The House Judiciary Subcommittee on Regulatory Reform, Commercial and Antitrust Law held a hearing on the proposed merger of American Airlines and U.S. Airways.
Lawmakers examined how the proposed merger would affect competition and consumers in the industry. If the merger is approved, 80% of the domestic airline market would be controlled by four airlines.
"Under its antitrust jurisdiction, the Judiciary Committee has a responsibility to examine the competitive impacts of significant transactions on the marketplace. This hearing will allow many points of view to be heard and provide the public with valuable information on the proposal," Subcommittee Chairman Spencer Bachus (R-Ala.) said.
Stephen Johnson, executive vice president for corporate and government affairs of US Airways; Gary Kennedy, senior vice president and general counsel of American Airlines; Kevin Mitchell, chairman of Business Travel Coalition Inc.; Christopher L. Sagers, professor at Cleveland-Marshall College of Law; and Clifford Winston, senior fellow in economic studies at the Brookings Institution, testified.
Mr. Kennedy noted that this merger transaction is unique because it is endorsed by the boards of both companies as well as all of the labor unions involved. Mr. Johnson said this merger would make the new American Airlines the largest airline in the United States, with access to cities not served by the airlines individually, and would make a full recovery from bankruptcy. When answering a question on whether American Airlines could stand alone coming out of bankruptcy without a merger, Mr. Johnson noted that they could, but with the merger they would have a path to pay workers the same wage they are making now, unlike their competitors.
A Senate Judiciary subcommittee will hold a hearing on this merger on March 19.