100 years of airline survival

Travel Weekly

a day ago

The terror attacks of 9/11 were the first salvo in what would end up being a wave of U.S. legacy airline bankruptcies and consolidation over the next 15 years. High fuel prices, especially after Hurricane Katrina, were another major noose on an industry still working its way through the post-deregulation readjustment. And the success of Southwest, coupled with emerging low-cost carriers like Spirit, was placing pressure on higher-cost operators.
TWA, which filed for bankruptcy prior to 9/11, was the first legacy brand to disappear in the new millennium, merging into American in late 2001. Bankruptcies would follow at United, Delta and eventually American, along with Northwest, US Airways, Continental and several smaller carriers.
Out of the wreckage, the Northwest brand folded into Delta, flying its last branded flight in 2010. Continental merged into United, flying its last flight in 2012. And US Airways last took to the sky in 2015, merging with American.
Brand power was a key factor in which airline names survived these 21st century mergers of legacy carriers. In the case of Delta/Northwest, it was the Delta management team that took control. But in the cases of United and American, the names survived, while the management teams didn't.
Oakley said that United's reputation was among the worst in the industry at the time of its merger with the more respected Continental, leading to widespread consternation among Continental employees.
But, noted Van der Linden, the United brand name took the day even as the Continental leadership took control. After all, United had for most of the previous several decades been the largest U.S. airline.
'In marketing, a lot more people were familiar with United than they were with Continental,' he said.
American used its merger with US Airways to navigate out of Chapter 11, which it had entered into in 2011.
Out of the merger, control was turned over to the US Airways management team — the same team that several years earlier had graduated to US Airways from America West, also through a merger. But the US Airways brand gave way to more prominent American.
'American is an iconic brand and is our flag carrier for the country,' Caroline Clayton, the airline's chief marketing officer, said in a recent interview. 'When you have a brand with that kind of power, that loyalty, that affinity and dedication from team members and customers, you use that.'
With Delta having reached 100, and American and United set to follow soon, Van der Linden said the three remaining U.S. legacy airlines can expect to be around for a while to come.
'We're back, in a way, to before 1978 with an oligopoly,' he said, referencing the date of deregulation. 'It has taken 40-plus years for the dust to settle, but the industry has settled down.'