United Airlines CEO Scott Kirby confirmed on Monday that he had approached rival American Airlines about a potential merger, marking his first public acknowledgment of the proposal. In a statement, Kirby argued that the combination would benefit travelers, even though American refused to engage in negotiations.
Kirby's Statement and Rationale
“I was confident that this combination, which would have been about adding and not subtracting, creating a truly great airline that customers love, could get regulatory approval,” Kirby wrote. “I was hoping to pitch that story to American, but they declined to engage and instead responded by publicly closing the door.”
Kirby's confirmation comes after weeks of speculation about a potential merger between two of the largest U.S. airlines, amid rising jet fuel prices linked to the Iran war and reports that he had approached the White House about the idea. It remains unclear whether Kirby approached American before or after his White House meeting.
American Airlines' Rejection
American Airlines publicly dismissed the merger idea, stating on April 17 that it “is not engaged with or interested in any discussions regarding a merger with United Airlines.” The company added that such a combination “would be negative for competition and for consumers” and could raise antitrust concerns. American itself is the product of a 2013 merger with US Airways Group.
President Donald Trump also voiced opposition to a merger last week.
Potential Benefits and Industry Context
Kirby, who previously served as president of American Airlines, argued that merging the carriers would expand service, create a more globally competitive airline, and boost the U.S. economy by generating jobs and strengthening the aircraft manufacturing sector.
The rivalry between United and American has long played out in pricing battles and disputes over gate access at major hubs like Chicago’s O’Hare International Airport. Amid this competition, the Federal Aviation Administration ordered about 300 daily flights cut from peak summer schedules at O'Hare, citing risks of overwhelming the airport. The order takes effect June 2.
Financial Impact and Fuel Prices
Shares of Chicago-based United fell 1.2% on Monday to $91.90, down about 18% this year amid the Iran war, which began in late February and has driven fuel prices sharply higher. American shares fell about 3.5% to $11.68, down nearly 24% for the year. Jet fuel, a major expense for airlines, has more than doubled in some markets due to fighting near the Strait of Hormuz, raising operating costs. Carriers worldwide have raised fares and fees, including United and American, which increased checked baggage fees.
