Filed under: Deals, Consumer experience, Competitive strategy, Contl Airlines’B’ (CAL), Oil, Delta Air Lines (DAL)
While Northwest (NYSE:NWA) and Delta (NYSE:DAL) have decided to merge, Continental (NYSE:CAL) will take the road in the other direction by electing to stay independent.
According to The Wall Street Journal “Continental’s statement comes as the industry faces soaring fuel prices.” The trouble is that whether airlines merge or not, crude oil prices continue to rise.
Continental has probably made a wise decision. There is no guarantee that the marriage of NWA and DAL will help either company. Mergers mean lay-offs and that often means strikes. If there are labor walk-outs the new carrier could face weeks of being unable to fly and unable to collect revenue. Merged reservation systems can also take months to integrate.
Continental will be on its own, but if fuel continues it sharp ascent, it won’t matter.
Douglas A. McIntyre is an editor at 247wallst.com.
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