Merger of United and Continental could lure more Texans to Aspen
Glenwood Springs, CO Colorado
ASPEN, Colorado – The proposed merger of United Airlines and Continental could help Aspen-Snowmass tap two of its biggest markets more effectively, business leaders and the airport manager said Monday.
Continental has a hub in Houston and a major presence in Dallas. If the airline merges with United, travel between those cities and Aspen could potentially become more convenient, said Jim Elwood, aviation director at the Aspen-Pitkin County Airport.
“I think there are some opportunities for the airport,” he said.
United and Continental duked it out for dominance in the Aspen market in the 1980s and early 1990s. Continental abandoned its hub at Denver and stopped Aspen service by the mid-1990s. United expanded its presence in Colorado and strengthened its position as the dominant carrier in the Aspen market.
But United doesn’t offer a lot of service in some of the major markets where Continental focuses, such as Cleveland and Newark as well as Houston and Dallas, Elwood said. The merged airline would potentially enhance travel opportunities from some of the markets that are now lacking.
Skiers from Houston and Dallas are finding ways to get here now. Dallas was the Aspen Skiing Co.’s sixth largest domestic market during the 2008-09 ski season while Houston was seventh, according to Skico spokesman Jeff Hanle. The two cities have hovered around that level for a good part of the last decade. Hanle said the number of visitors from Texas increased when Frontier Airlines started serving Aspen during the 2008-09 winter. Frontier had established service between Denver and Texas cities.
Skico Senior Vice President David Perry said direct flights between Aspen and Houston were “something that’s been on our radar” for quite some time, even before the merger materialized. It is uncertain if the merger would enhance the chance at the direct flight, he said, because it all boils down to aircraft availability.
Nevertheless, Perry said the merger, if it is approved by the government, would provide benefits in the long-term to Aspen-Snowmass tourism.
“I think this only provides a greater opportunity for us,” he said.
Bill Tomcich, president of Stay Aspen-Snowmass and the business community’s liaison to airlines, said the merger would be good for United, and anything good for United would be good for Aspen-Snowmass.
“This will certainly enable our largest and most important travel partner to compete more effectively in the longer term,” Tomcich wrote in an e-mail from Hawaii, where he is vacationing. “Just one year ago, many questioned the ability of United to survive.”
Another advantage of the merger is it won’t drain any competition from the Aspen market, Tomcich said. United’s competition in Aspen comes from low-cost carrier Frontier. Analysts said in national reports on Monday that the merger of United and Continental would help the combined carrier compete more effectively against low-cost competitors.
“This week’s announcement is welcome news for us no matter how you look at it,” Tomcich said.
Elwood and Perry cautioned that the merger isn’t a lock to be approved, so trying to predict effects on service is nothing more than speculation. As it stands now, United and Frontier are both committed to serving Aspen for the next 11 months, which is the farthest out that airlines will plan.
Frontier will stop flying the Q400 aircraft into Aspen starting Labor Day, Elwood said. It is unknown what replacement aircraft will be used. Frontier was purchased last year by Republic Airlines.
United will stop flying the DeHavilland Dash 8 in the Aspen market and rely entirely on the CRJ700 regional jet, Elwood said. The transition means United will offer fewer flights but more seats, he said.
The Associated Press reported Monday that United agreed to buy Continental in a $3 billion-plus deal that would create the world’s largest carrier with a commanding position in several top U.S. cities.
The new United would surpass Delta Air Lines in size, which should help it attract more high-fare business travelers. It will fly to 370 destinations in 59 countries.
The companies insisted the deal is a merger of equals.
But United shareholders will hold a majority stake, the airline will be based in United’s hometown of Chicago and it will be called United.
The deal would create a giant with major hubs in key domestic markets including New York, Los Angeles, Chicago, Houston and San Francisco and an international network stretching from Shanghai to South America.
It will leave three big U.S. airlines with major international routes – the new United, Delta and American Airlines, with US Airways a distant fourth.
United is the nation’s third-largest carrier by traffic, while Continental Airlines Inc., in Houston, is No. 4.
Wall Street has pushed consolidation as a way to let airlines raise fares by reducing the number of flights and seats. Antitrust regulators are likely to scrutinize the deal for its effect on fares, but airline officials said even a larger United won’t have power to boost prices because other carriers might undercut them.
Henry Harteveldt, a travel-industry analyst for Forrester Research, said U.S. leisure fares might not change much because Continental and United routes overlap heavily with low-fare carriers such as Southwest. He thinks the new United will have more success raising fares on business travelers.
The Associated Press contributed to this report.
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