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Search Terms: United Airlines AND U.S. Airways AND Merger, House or Senate or Joint

Document 73 of 110.

June 14, 2000, Wednesday

SECTION: PREPARED TESTIMONY

LENGTH: 387 words

HEADLINE: PREPARED TESTIMONY OF THE HONORABLE JAMES T. WALSH

BEFORE THE HOUSE COMMITTEE ON THE JUDICIARY

SUBJECT - THE STATE OF COMPETITION IN THE AIRLINE INDUSTRY

BODY:
I would like to express my strong reservations about the proposed merger of United Airlines and US Airways that will be discussed today here in the Judiciary Committee. While I am a strong proponent of economic growth and development, this recently announced merger could only have a detrimental impact on Central New York air service and our economy.

Congress has already seen the result of what happened after we passed the Air Transportation Regulatory Reform Act in 1978 (PL 95-504). This law was enacted so that market forces in the airline industry could determine the quality of service, variety, and airline ticket prices of air services. We were told by the airline industry that deregulation would bring about greater competition, better service, and lower costs for the consumer. In many of our large, major urban centers this is exactly what happened; however, smaller urban areas haven't seen similar results. Many of these communities find themselves saddled with one dominant carrier and no competition resulting in extremely high airfares. This recent merger is a prime example of anti-competitive tactics to reduce competition in the airline industry. One of the issues United has proposed to address these possible U.S. antitrust concerns is that United plans to sell operations here at Washington National Airport to BET Holdings, Inc. which will create a new airline called DC Air. Under the DC Air proposal, the number of flights from National Airport to Upstate New York will likely remain the same, therefore continuing the combination of high rates, less competition, and less jet service which will in turn have a negative impact not only in the economic development of Syracuse and other neighboring cities but all of Upstate New York.

In my district alone, USAir already controls 42% of the travel market out of Syracuse Hancock International Airport. The combination of the two airlines would not only control about 27% of the U.S. market but over 50% of the travel market out of Syracuse, which already pays the fifteenth highest airfares in the nation. I cannot support a merger if increased travel costs, possible loss of service, and dismissal of longtime employees are part of the equation.

I thank Chairman Hyde for the opportunity to express my interest in this matter.

END

LOAD-DATE: June 16, 2000

Document 73 of 110.


Search Terms: United Airlines AND U.S. Airways AND Merger, House or Senate or Joint
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