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United CEO Skeptical of Airline Mergers After American Rebuff

New York Times Business •
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Following his rebuffed merger proposal with American Airlines, United Airlines CEO Scott Kirby expressed skepticism about pursuing other deals. Kirby noted that merging with American would have been "transformative," but smaller acquisitions don't justify the massive integration effort required to combine computer systems, planes, operations, and labor unions.

Kirby stated that "doing a merger takes a lot of calories and a lot of energy" regardless of size, making deals with smaller airlines like JetBlue unattractive. After American rejected his overture, United will now focus on organic growth by better utilizing existing resources, including replacing smaller planes with larger ones on routes serving hub airports like Newark Liberty and San Francisco.

With high fuel prices expected to persist, United may capitalize on other carriers' retrenchment by taking plane deliveries that competitors cancel or postpone. Kirby also voiced opposition to government aid for struggling airlines, maintaining that "different businesses, different models. Some of them work, some of them don't" under a capitalist system.