Copyright 2000 Star Tribune
Star Tribune
(Minneapolis, MN)
June 8, 2000, Thursday, Metro Edition
SECTION: BUSINESS; Pg. 8D
LENGTH: 408 words
HEADLINE:
Congressmen express concerns about United-US Airways deal
BYLINE: Tom Hamburger; Staff Writer
DATELINE: Washington, D.C.
BODY:
Minnesota Sen. Paul Wellstone and North
Dakota Rep. Earl Pomeroy asked the Justice Department on Wednesday to give "very
close scrutiny" to a recently proposed merger of United Airlines and US
Airways.
Wellstone, a Democrat,
also wrote Northwest Airlines CEO John Dasburg on Wednesday, urging him to
"inform Minnesotans about the impact of the company's reported possible merger
plans with American" Airlines.
Rumors about a possible
Northwest-American marriage have been circulating since the proposed United-US
Airways merger. The
letters follow similar expressions of concern by other
prominent Minnesotans. Rep. James Oberstar, D-Minn., the ranking member of the
Transportation Aviation Subcommittee, and Minnesota Attorney General Mike Hatch
both have expressed reservations about the merger plan.
Pomeroy, a Democrat,
said in an interview Wednesday that he wrote Attorney General Janet Reno asking
for "very, very close scrutiny of the US Airways-United merger."
His fear, like
Wellstone's, is that such a merger "would trigger a round of consolidation in an
already consolidated market."
Pomeroy said
that six airlines currently have nearly 80 percent of the total aviation market
share. In 1985, nine airlines served that
proportion. "Too little competition is a
problem in lots of areas, including North Dakota," Pomeroy said.
Wellstone said in his
letter to Dasburg that the airline had an obligation to keep Minnesotans
informed of any possibility that it might merge with another company.
"The State of Minnesota
helped to save Northwest Airlines in 1994 when there were serious concerns about
the economic future of your company," Wellstone wrote. "Minnesotans are
stakeholders in Northwest Airlines, and they deserve a careful explanation of
both why a merger may take place and what the impact of this merger would be to
our state."
In his
letter to the Justice Department, Wellstone said that if they merged, United and
US Airways would become the world's largest
airline. He said a merger
would give the combined airline "enough market power to charge air travelers
monopoly prices." That, Wellstone said, would prompt other airlines to merge.
Northwest spokesman Jon
Austin declined to comment on the
letters. "We can't
comment on rumors and speculation on transactions that may or may not be under
consideration," he said.
LOAD-DATE: June 8,
2000 
