FT. WORTH, Texas, Thu Feb 14 — American Airlines and US Airways Group said they plan to merge in a deal that will form the world’s biggest air carrier, which will have a combined equity value of $11 billion.
The merger caps a wave of consolidation that has helped put U.S. airlines on more solid financial footing.
The widely expected deal has been more than a year in the making. American, a unit of AMR Corp, filed for Chapter 11 bankruptcy in November 2011, and US Airways began its pursuit of a merger in early 2012.
CHICAGO ― United Continental Holdings and its rival U.S. Airways Group on Thursday said their quarterly profits were battered by soaring fuel costs, but travel demand appears to be robust, undeterred by gathering economic threats.
The third-quarter results conclude the earnings season on a mostly positive note for major U.S. airlines and reflect a newfound ability to manage capacity, one analyst said.
United Continental’s shares fell nearly 2 percent to $19.94 on the New York Stock Exchange after its profit came in below forecasts. US Airways’ profit beat forecasts and its shares gained 2.1 percent to $5.78 in morning trading.
“There’s no signs of weakness yet,” said Helane Becker, an analyst with Dahlman Rose & Co. “What you’re seeing across the board for the group in general is pretty positive.”The airline industry is on the mend after a decade-long downturn that sent several carriers into bankruptcy. But even as soaring fuel costs and economic gloom threaten to disrupt the recovery, carriers have managed the plight effectively by cutting the number of seats they sell when times get rough.
Airline analysts had been on the lookout for signs of weakness in travel demand in the fourth quarter and in 2012. But those signs have yet to materialize.
“Looking forward, we see continued strong demand in the fourth quarter,” U.S. Airways Chief Executive Doug Parker said in a statement.
United Continental, in a regulatory filing on Thursday, said its advance bookings for the next six weeks were up 3.2 percentage points from the same period a year ago on domestic routes and down half of a percentage point on international routes.
The sentiments echo those voiced recently by Delta Air Lines and Southwest Airlines.