US Airways and AMR seal $18bn merger

City A.M. Reporter
AMERICAN Airlines Group, the world’s biggest airline after AMR’s merger with US Airways Group, intends to take advantage of its broad global network to win more corporate customers, the company’s president said.

American Airlines parent AMR and US Airways sealed their $18bn (£10.9bn) merger yesterday. Shares are trading on Nasdaq under the symbol AAL.

“We will now have a network that can get customers everywhere they want to go. Because of that, we have more ability to compete for corporate customers,” said Scott Kirby, the former president of US Airways who has that role at the new American.

Corporate customers can spend three times as much as leisure travelers, making them a lucrative segment for airlines. Kirby said corporate accounts could bring in “hundreds of millions of dollars”.

American Airlines, once the largest US carrier, had fallen to third place behind United Continental Holdings and Delta, both of which used Chapter 11 – a form of bankruptcy – to cut costs. For years, American’s higher cost structure had put it at a disadvantage.

AMR declared bankruptcy in November 2011, citing high labour costs, and eventually reached cost-saving contracts with its three primary unions.