There is no such thing as a good airline merger

Implications: *Service will get worse...I know that is hard to imagine. *Fares will go up. *Communites will loses both Hubs, flights and jobs. *If it happens it will be Delta merging with Northwest and United merging with Continental and no one want US Airways

Analysis: There is no such thing as a good airline merger in recent history.Take for example the most recent US Airways and America West merger.  More than 2 years later, they are still sorting out labor and service issues..and they are relatively small carriers when compare to the mega-mergers being currently contemplated!  Or how about the American Airlines /TWA merger before that...while the service issues were not nearly as bad, the St. Louis hub has virtually disappeared. 

The institutional investors would have you believe that Delta needs to merge with either Northwest or United to take advantage of the "economies of scale". (Conventional wisdom says that Delta merges with Northwest and that United merges with Continental).  What is interesting is that Delta and United are already in the top 5 airlines in the world.  This begs the question...how big do you have to be to get economies of scale?  If these mergers are to pass antitrust muster...which in an election year, is unclear here is what you can count on over time.

* Say good bye to the following airline hubs  and jobs in those citIes:   Cleveland (Continental), Cincinnati (Delta)...a big loss for Ohio, and Memphis (Northwest)

* A loss of service to countless other cities.
*  Miserable service as they integrate different disparate equipment and processes (anybody remember Frank Lorenzo combining Peoples Express, Continental, Eastern et al...well that was pale in comparison to these mega-mergers!)  The integration of these mergers (4 airlines into 2 airlines will take at least 3-4 years at a minimum per merger
*For this wonderful (read:awful) service you will have to pleasure of getting to pay more for it as well...is this a great country or what?

Since 3 of the 4 carriers that are in the merger rumor mill have been in bankruptcy recently (only Continental had been in Bankruptcy in the 80's and 90's....a lifetime ago!), it would seem that there cost structure is already competitive without having the "economies of scale".  Yet Southwest is always able to find a way to be competitive without an international network, no real alliances to speak of, and only a shrinking fuel hedge to rely on...makes you wonder what they know ???