Two of the country’s major airlines are taking one step closer to finalizing that merger they couldn’t complete this spring. Who doesn’t like second chances? But will it help passengers get cheaper plane tickets?
Continental and United Airlines will join in an ‘unholy’ alliance to share rewards, discount codes, customers, and frequent-flier points. It’s not a merger yet, but just a plan for the two to work together in these slim-margin, high-fuel cost days.
This announcement basically puts an end to those other ongoing talks Continental had with American Airlines and British Airways. Ouch, burn!
A USA Today article has all the juicy, soap-opera-like merger betrayals:
American, a unit of AMR, and British Airways tried to lure Continental to its team, called oneworld. But a three-way deal grew less likely as Continental resumed its flirtation with United. Earlier this year, Continental and United were in advanced talks to become a single carrier.
But Continental walked away from the deal after UAL reported a huge loss for the first quarter. Continental Chief Executive Lawrence Kellner said the Houston-based carrier preferred to remain independent.
This Continental/United alliance will help reduce fuel costs for both the airlines and will assist with selling one another’s flights. However, still yet to be seen: airlines passing on those cost reductions to their passengers.
USA Today: Continental, United Join Alliance, June 19, 2008