US Airways and American Airlines are waiting on approval for a merger plan that would make them the largest air carrier in the world. (It’s such a big deal that they need approval from the European Union, as well as the U.S. government.) The new super-airline would find itself controlling two-thirds of the takeoff and landing slots at one particular airport that just happens to be the one Congress uses: Reagan National in Washington, D.C.
“So it’s easy to be skeptical about the letter signed by more than 100 lawmakers urging the Justice Department, which is reviewing the merger, to preserve the nonstop flights from Reagan National to small- and medium-sized airports across the country,” says NPR.
But Rep. Mike Michaud (D-ME) says to set aside your skepticism, because this isn’t about protecting the travel perks of our ruling class. No, it’s just good old-fashioned lunkheaded protectionism:
“It has nothing to do with lawmakers’ convenience and everything to do with representing small communities that rely on these direct flights for economic benefits,” Michaud says. “This is a bipartisan response to what we have heard from our constituents back home in the district.”
Michaud represents Maine’s 2nd District and lives about 65 miles from Bangor, which has three daily nonstops to the nation’s capital.
Tony Caruso, director of Bangor International Airport, says those flights are pretty full.
“There’s quite a bit of travelers. It’s a good mix of both business and leisure travel,” he says. “The load factor — which is basically the number of seats sold on those aircraft — they average over 80 percent. Certainly we think these flights are critical to the overall health and growth of, certainly, the Bangor region and Maine economy.”
The CEO of US Airways pointed out that it would be silly for his airline to maintain routes they cannot make a profit on, and there’s no reason to think other carriers would do so, if the new mega-airline was forced to give them slots at Reagan. Conversely, there is no reason an airline of any size would give up profitable service like the route to Bangor, if those flights are averaging 80 percent loads.
Reducing the level of competition (through a merger that turns two big airlines into one gigantic company) doesn’t cause particular routes to magically become more or less profitable. The concern seems to be that two smaller airlines might maintain less profitable, or even unprofitable, routes to compete with each other on an image basis, i.e. “Fly American! We have service to Podunk, unlike our competitors!” Has there been a lot of such competition between American and US Airways, giving us reason to think those loss-leader image-building routes would disappear when they merged? And even if the answer is “yes,” is the solution to somehow force airlines to provide unprofitable services – essentially another hidden tax on the American traveler, since the companies have to recover those losses somehow? That would be especially galling if individual Congressmen obviously had a personal interest in keeping their favorite routes open.