May 21, 2018
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Approved airline merger could put Maine flights at risk, but airports say news might not be so bad

By Nick McCrea, BDN Staff

BANGOR, Maine — When the U.S. Department of Justice dropped its antitrust lawsuit that was holding up the U.S. Airways-American Airlines merger on Nov. 12, Maine’s U.S. senators threw their hats in the ring in hopes that Maine’s airports wouldn’t take a hit.

For the airlines, the DOJ decision is good news. They’ve been cleared to combine to form a new American Airlines, creating the largest airline on the planet. The new company will fly more than 6,700 flights to 336 destinations in 56 countries per day, according to a company news release. American Airlines has been mired in bankruptcy proceedings since 2011, when the company filed for bankruptcy protection.

In order to get the deal done, however, US Airways and American agreed to divest flight slots, meaning the airline will have to operate 44 fewer daily departures at Reagan National Airport in Washington, D.C. (DCA) and 12 fewer daily departures at New York’s LaGuardia Airport.

Where those slots will be lost has yet to be determined, but it’s likely airports in small- and medium-sized markets — such as Bangor and Portland, Maine — could be targeted. U.S. Airways and American have said that no city will lose service entirely.

Sen. Susan Collins, the ranking member of the Senate Transportation Appropriations Subcommittee, has spoken with US Airways CEO Doug Parker, who will become CEO of the merged airline. Collins flies from D.C. to Maine every weekend to attend to business at home.

“Not only is consumer demand for these flights strong, but also they are essential to business development and attraction to Maine’s tourism industry,” Collins said in a statement rehashing her conversation with Parker. “Mr. Parker listened carefully and promised to consider these important factors as he makes the decisions necessary to comply with the Justice Department’s mandate.”

Collins also joined Sen. Angus King in writing a letter to the CEOs of both Airlines, urging them to consider carefully the implications of cutting flights to places such as Bangor and Portland.

“Maintaining direct access between small- and medium-sized communities and our nation’s capital is important for facilitating commerce and tourism for residents, businesses and visitors,” the senators wrote. “As you conduct your review, we urge you to make the process transparent and to evaluate to consequences of flight divestiture on the economies of small- and medium-sized communities, like the cities of Bangor and Portland, and the surrounding regions in Maine.”

During peak months, Bangor International Airport runs three or more daily flights on the D.C.-Bangor route, with load factors over 81 percent and as high as 90 percent during busy travel months. About 60 percent of people who fly the route are people coming to Bangor, rather than leaving.

How might Bangor be affected by the divestitures?

“At this point, it remains to be seen,” BIA Director Tony Caruso said recently, but flights could have a “significant impact.”

The merger itself is “certainly good news,” Caruso said. It will create a stronger, more competitive airline that could serve in Bangor for a long time to come.

“Our hope is that the merger still continues and we are not affected by any flight divestitures,” Caruso said.

In April, the Bangor City Council adopted a resolve calling on the U.S. Department of Justice to approve the airline merger without divesting flights. Its effort to influence the negotiations appear to have fallen flat.

Paul Bradbury, director of Portland International Jetport, echoed the benefits of the merger and didn’t express much concern about the potential loss of flights.

“I believe that the American-US Airways merger will be a net positive to the Portland International Jetport, and I am pleased the merger is going through,” Bradbury said in an email.

Currently, his airport is represented by two of the three airline alliances — Star Alliance and Sky Team. After the merger, US Airways will be part of the One World Alliance, meaning Portland will have airlines from all three major alliances in its airport.

“I believe there is opportunity for service to additional non-stop destinations from [Portland International Jetport] to the current American network,” Bradbury said.

However, the fact that the airport could lose some of its flight capacity to Reagan is a downside, he said.

The DOJ filed its antitrust lawsuit to block the merger back in August, citing concerns that the merger could drive up fares and prices for passengers.

The companies say they plan to complete the merger in December. There will be no changes to the airline operations before the merger and divestitures are final, according to a U.S. Airways spokesman.

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