Continental-United Airlines merger
United Airlines, a subsidiary of United Continental Holdings, Inc. (NYSE: UAL), is the airline of the post-merger of United Airlines and Continental Airlines. It is based in United Airlines hometown of Chicago. While it continues to bear the United name, it features Continental's livery.
The new United is run by Continental's CEO, Jeffery Smisek, along with United Airline's CEO, Glenn Tilton, serving as non-executive Chairman of the board. United is the world's largest airline in revenue passenger miles and fleet size.
On Sunday, May 2, 2010, the Boards of Directors at Continental Airlines and United Airlines approved a stock-swap deal that would combine them into one airline called the "United Airlines". EU and U.S. regulators, as well as shareholders have since approved the merger.[3] United's pilots union announced that they "are fully prepared to protect and defend the interests of all United pilots."[4] The companies expect to complete the transaction, worth (USD)$3.2 billion,[5] in the fourth quarter of 2010.
On August 27, 2010, the U.S. Department of Justice approved the $3 billion merger.[6] Share holders of both companies approved the deal on September 17, 2010. The transaction was completed on October 1, 2010.[7]
Both carriers will begin to merge operations in 2011 and a single operating certificate from the FAA is expected by 2012.[8]
Development
Early in February 2008, UAL Corporation and Continental Airlines began advanced stages of merger negotiations and were expected to announce their decision in the immediate aftermath of a definitive merger agreement between rival Delta Air Lines and Northwest Airlines.[9] The timing of the events was notable because Northwest's golden shares in Continental (that gave Northwest veto authority against any merger involving Continental) could be redeemed, freeing Continental to pursue a marriage with United. On April 27, 2008, Continental broke off merger negotiations with United and stated it was going to stand alone.[10] Despite ending merger talks, Continental announced that it will join United in the Star Alliance.[11]
United and US Airways were in advanced merger talks in late April 2008, following the announcement that Continental had broken off talks with United.[12] In June 2008, CEOs of both United Airlines and Continental Airlines signed an alliance pact presaging their eventual merger. The alliance is an agreement to link international networks and share technology and passenger perks. This agreement is basically a "virtual merger" that includes many of the benefits of a merger without the actual costs and restructuring involved. The alliance took effect about a year after Delta Air Lines and Northwest Airlines completed their merger, as that released Continental from the SkyTeam contract and allowed for the required nine-month notice. Additionally, Continental joined the Star Alliance, as Delta and Northwest merged.[13]
United Airlines was reported to be in serious merger discussion with US Airways in early April 2010. A New York Times report indicated that a deal was close. Union consent was cited as a major hurdle for negotiators to clear.[14] On April 22, 2010, United announced that it would not pursue a merger with US Airways.[15]
The Board of Directors at Continental and United airlines approved a stock-swap deal that would combine them into the world's largest airline on Sunday, May 2, 2010. The airlines publicly announced the deal the next day.[16] The new airline will take on the United Airlines name and be based in United's hometown of Chicago. It will be run by Continental's CEO, Jeff Smisek. UAL's CEO, Glenn Tilton, will be non-executive chairman. The deal will still need final approval from labor unions and antitrust regulators before being allowed to go forward.[4] This would re-unite Walter Varney's airlines, which offspring includes Continental and United.[17]
Template:Wikinews2 Both airlines have taken losses in the recession and expect the merger to generate savings of more than $1 billion a year.[18] Combined, they fly to some 370 destinations in 59 countries from their ten hubs,[19] and carry 144 million passengers a year.[18] Combined revenues will be about $29 billion.[20]
In July, the merger of the two airlines was approved by the European Union.[3]
On August 27, 2010, the U.S. Department of Justice approved the $3 billion merger[21] and shareholders of both the companies approved the merger on September 17, 2010.[22][23]On October 1, 2010, UAL Corporation (the parent company of United Airlines) completed its acquisition of Continental Airlines and changed its name to United Continental Holdings, Inc. Although the two airlines remain separate until the operational integration is completed (by mid-2012), as of this day both airlines are corporately controlled by the same leadership.
Branding
At the time of the announcement in May, United Airlines and Continental Airlines used a new United logo. It featured the words, "United Airlines" in the current Continental typeface, as well as still maintaining Continental's globe like emblem. In August, the font was changed to United's upper-case sans-serif font, and the word, UNITED, without the word, Airlines was displayed, perhaps due to a negative feedback regarding the new font and livery. Overall, the airline justifies the logo as a reflection of a new "global airline".[24][25]
Some reaction to the new United livery and branding revealed in May has been negative in several reports, in favor of the company's current Saul Bass logo. The first new United logo, which was designed "in-house" by Continental Airlines, was criticized as as cheap and poorly executed because, in part, it too closely resembled the old Continental logo.[26] United updated the new logo in August, reducing the resemblance, by replacing the words "United Airlines" with the single word UNITED, as well as altering the font.
A Continental Airlines 737-900 series aircraft (N53442) was the first aircraft to be painted into the new livery for the combined company.
Hubs
The combined airline will serve up to 370 destinations, from the 10 hubs listed below. This may subject to change due to future developments and decisions. Continental and United said that Houston's George Bush Intercontinental Airport will be the largest hub for the new airline, which is a primary gateway to Latin America.[27]
United Airlines hubs
- Antonio B. Won Pat International Airport – primary Pacific hub
- Cleveland Hopkins International Airport - Midwest hub
- Denver International Airport - Western hub
- George Bush Intercontinental Airport – largest hub, primary gateway to Latin America
- Los Angeles International Airport - secondary West Coast hub, operating to Hawaii and Australia
- Narita International Airport – focus city operating Asian routes. May remain focus city or become Asian hub
- Newark Liberty International Airport - main East Coast hub, and New York Metro Area base
- O'Hare International Airport – second largest hub, and the base of the new airline
- San Francisco International Airport – primary West Coast hub
- Washington Dulles International Airport - secondary East Coast hub, operating to Europe and Africa
The "New" United Airlines Fleet
The new United will be the second largest airline in terms of fleet size, while Delta Air Lines remains the largest. The combined airline houses a fleet of nearly 700 aircraft, surpassing American Airlines' 621. There are also 118 aircraft on order, 50 from United, and 68 from Continental. The combined fleet features a mixture of Airbus and Boeing aircraft, comprising of Airbus A319s, Airbus A320s, Boeing 737s, Boeing 747s, Boeing 757s, Boeing 767s, and Boeing 777s with orders of Airbus A350s and Boeing 787s.
The resumption of 737-800 (etc) service by the combined carrier may allow furloughed 737-pre-NG UAUA pilots to resume work in accordance with union agreements.
| Aircraft | Total | Orders | Notes | Livery | |||||
|---|---|---|---|---|---|---|---|---|---|
| United "Battleship" | United Blue Livery | Continental | New United | Star Alliance | Special | ||||
| Airbus A319-100 | 55 | 0 | 42 | 13 | 0 | 0 | 0 | 0 | |
| Airbus A320-200 | 97 | 0 | 33 | 64 | 0 | 0 | 0 | 0 | |
| Airbus A350-900XWB | 0 | 25 | Entry into Service: 2016-2019 Replacing: Boeing 747-400 |
0 | 0 | 0 | 0 | 0 | 0 |
| Boeing 737-500 | 32 | 0 | 0 | 0 | 32 | 0 | 0 | 0 | |
| Boeing 737-700 | 35 | 0 | N13720 painted in Star Alliance livery | 0 | 0 | 34 | 0 | 1 | 0 |
| Boeing 737-800 | 126 | 41 | 9 deliveries scheduled in 2010 N26210 painted in Star Alliance livery N76516 painted in Eco-Skies livery |
0 | 0 | 124 | 0 | 1 | 1 |
| Boeing 737-900 | 12 | 0 | 0 | 0 | 12 | 0 | 0 | 0 | |
| Boeing 737-900ER | 30 | 0 | N75436 painted in Continental's 75th Anniversary livery N53442 painted in the new livery |
0 | 0 | 28 | 1 | 0 | 1 |
| Boeing 747-400 | 25 | 0 | N121UA painted in Star Alliance Lively Exit from Service: 2016-2019 Replacement: Airbus A350-900XWB |
1 | 23 | 0 | 0 | 1 | 0 |
| Boeing 757-200 | 137 | 0 | N14120 painted in Star Alliance livery Second Largest operator of 757-200 after Delta Air Lines |
24 | 72 | 39 | 1 | 1 | 0 |
| Boeing 757-300 | 21 | 0 | Largest operator of the Boeing 757-300 Retrofitted with blended winglets |
0 | 0 | 21 | 0 | 0 | 0 |
| Boeing 767-200ER | 10 | 0 | All feature Boeing's signature 777 style interior | 0 | 0 | 10 | 0 | 0 | 0 |
| Boeing 767-300ER | 35 | 0 | N653UA painted as Star Alliance livery | 14 | 21 | 0 | 0 | 1 | 0 |
| Boeing 767-400ER | 16 | 0 | 0 | 0 | 16 | 0 | 0 | 0 | |
| Boeing 777-200 | 19 | 0 | 2 | 17 | 0 | 0 | 0 | 0 | |
| Boeing 777-200ER | 57 | 0 | N78017, N78021 and N77022 painted in Continental Star Alliance livery N218UA painted as United Star Alliance lively Largest operator of the 777-200ER |
4 | 28 | 22 | 0 | 3 | 0 |
| Boeing 787-8 | 0 | 36 | Entry into Service: 2011-2019 Replacing Boeing 767-300ER |
0 | 0 | 0 | 0 | 0 | 0 |
| Boeing 787-9 | 0 | 14 | 0 | 0 | 0 | 0 | 0 | 0 | |
| Total Number of Aircraft | 696 | 118 | |||||||
See also
References
- ^ Template:Url=http://www.unitedcontinentalholdings.com/download.php?file=united factsheet.pdf&type=pdf
- ^ {{cite news|url=http://news.smh.com.au/breaking-news-world/united-continental-create-worlds-biggest-airline-20100503-u39b.html%7Ctitle=United, Continental create world's biggest airline|date=May 4, 2010|publisher=[[The Sydney Morning Herald |accessdate=11 Aug 2010}}
- ^ a b http://www.google.com/hostednews/ap/article/ALeqM5iLtBZzKBc8HAtWTZlIMlpoajQZnQD9H7ILIO0
- ^ a b Continental and United Reportedly Approve Deal to Combine
- ^ Smith, Aaron (3 May 2010). "United and Continental to merge". CNN Money. Retrieved 4 May 2010.
- ^ U.S. Approves Merger of United and Continental: New York Times
- ^ Peterson, Kyle (September 17, 2010). "UAL and Continental shareholders approve merger". Reuters. Retrieved September 17, 2010.
- ^ "United, Continental to merge operations in 2011". The San Francisco Chronicle. September 20, 2010.
- ^ United stands ready to merge– chicagotribune.com
- ^ "Continental Abandons Merger Talks With United". The New York Times. April 28, 2008. Retrieved May 26, 2010.
- ^ Continental Airlines
- ^ 'http://www.msnbc.msn.com/id/24352806/'
- ^ Johnsson, Julie (2008-06-20). "United, Continental join forces". Chicago Tribune. Retrieved 2008-06-20.
- ^ "United and US Airways Said to be in Merger Talks". New York Times. 2010-04-07.
{{cite web}}:|access-date=requires|url=(help); Missing or empty|url=(help); Unknown parameter|http://dealbook.blogs.nytimes.com/2010/04/07/united-and-us-airways-hold-merger-talks/?ref=ignored (help) - ^ Reed, Dan (2010-04-22). "Irked US Airways ends merger talks with United". Usatoday.Com. Retrieved 2010-05-03.
- ^ Press Release. "Press Release | Let's Fly Together". Unitedcontinentalmerger.com. Retrieved 2010-05-03.
- ^ http://www.economist.com/node/16064180
- ^ a b "United and Continental Airlines to merge". BBC News. 3 May 2010. Retrieved 3 May 2010.
- ^ http://www.unitedcontinentalmerger.com/worlds-most-comprehensive-network
- ^ "United, Continental create world's biggest airlin". The Sydney Morning Herald. May 4, 2010. Retrieved 3 May 2010.
- ^ Mouawad, Jad (August 27, 2010). "United-Continental Merger Clears Federal Hurdle". The New York Times.
- ^ http://ir.united.com/phoenix.zhtml?c=83680&p=irol-newsArticle&ID=1472600&highlight=
- ^ http://www.continental.com/web/en-US/apps/vendors/default.aspx?i=http%3A%2F%2Fphx.corporate-ir.net%2Fphoenix.zhtml%3Fc%3D85779%26p%3Dirol-newsArticle%26ID%3D1472570
- ^ http://www.unitedcontinentalmerger.com/snapshots#/0
- ^ http://news.travel.aol.com/2010/08/12/united-continental-show-off-new-livery/
- ^ http://www.fastcompany.com/1638794/the-new-united-contintental-logo-flying-a-little-too-close-together
- ^ http://www.cleveland.com/business/index.ssf/2010/05/continental_and_united_announc.html
External links
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