WASHINGTON - At least two members of the House Transportation and Infrastructure Committee plan to send a letter to Attorney General Michael Mukasey and Transportation Secretary Mary Peters urging them to consider the negative effects on people who rely on air travel before approving any future airline mergers.
The letter, which will essentially oppose airline mergers, could benefit airports because mergers tend to be disruptive to their operations. Mergers also can hurt airport finances because the new combined airline typically reconfigures the service network, potentially causing some airports to lose passengers and the revenue they generate from car rentals and passenger facility charges. PFCs are fees that airports tack on to airfares and use to fund capital projects. They are often used to repay bonds issued by airports to pay for improvements.
The letter comes amid reports of at least two potential mergers, including a possible union of Delta Airlines and Northwest Airlines and a rumored marriage between United Airlines and Continental Airlines.
In a draft of the letter, Reps. Dan Lipinski, D-Ill., and Steve LaTourette, R-Ohio, ask the heads of the Justice Department and Transportation Department - which would both have to sign off on any merger - to fully take into account the effects on the public, including the quality of service.
"We strongly believe that it is vitally important to look at what types of impacts a potential airline merger would have on employees and the American flying public," the letter said. "We would urge you to carefully evaluate consolidation proposals to ensure they are not solely based on corporate interests. Rather, any consolidation must promote and protect the interests of the airline employees and the American flying public."
The letter pointed out that several issues resulting from the 2005 merger between US Airways and America West Airlines remain unresolved and have led to poor service and delays.
"For example, US Airways has not finalized a merger of the work forces of the two airlines, nor has the fleet service operation at the combined carrier been integrated," the letter said. "The failure to merge these groups has resulted in employees at the same airport doing the same job but working under different work rules and receiving dissimilar wages and benefits. These issues have resulted in inefficiencies and have likely contributed to degradation of customer service performance including lost bags and flight delays. It is [disconcerting] that such outstanding issues still exist, and examples such as these should be weighed heavily when considering future airline consolidations. This leads us to question how future mergers will result in any net benefits to the public."
Lipinski and LaTourette said they are currently seeking support from other House members before they send the letter.
One likely signatory is Transportation Committee chairman Rep. James L. Oberstar, D-Minn., who last month said he would do what ever he could to prevent any airline mergers.
At a press conference where he laid out his 2008 committee agenda, Oberstar said consolidation in the industry reduces the number of air service providers, particularly to smaller communities, which leads to less competition and can drive up airfares. He added that mergers also spur other consolidations as competitors seek to remain competitive.