Race To Be The Biggest In The Sky

American Air Carriers Hitching Their Wagons To European Counterparts To Stay Afloat

(CBS)  It's the closest thing the air travel giants can get to a merger without repainting the planes.

American Airlines and British Airways are asking for anti-trust immunity, so they can work together to set schedules and fares, creating a global powerhouse, offering more than 3,000 transatlantic flights a month, CBS News transportation and consumer safety correspondent Nancy Cordes reports.

"To American Airlines, it's do or die. If they do not get this, they're going to be severely disadvantaged to all their competitors," said airline industry analyst Darryl Jenkins.

That's because most of them already have dance partners across the pond.

Delta won immunity to set fares with Air France - and Northwestern has a deal with KLM.

Now Delta and Northwest want to merge - which would make the four carriers the largest network in the world.

Meanwhile, United's partnership with Lufthansa will become even more powerful if a new revenue-sharing deal with Continental wins government approval.

It's a race to be the biggest.

"The winner of this global airline prize gets an enormous amount of revenue in terms of business travelers who travel very long distances and pay the highest fares," Jenkins said.

The loser in all this? Some analysts say it's the passenger.

"What's happening is all of the competition in that market is being totally eliminated - instead of there being 10 or more carriers fighting it out, we'll have a cartel of three groups," said Hubert Horan, an airline industry analyst.

Those three groups, he argues, would control about 90 percent of the transatlantic market, which serves 50 million travelers a year.

"These carriers will be able to raise prices at will. It's just a terrible thing for consumers," Horan said.

A typical summertime ticket from New York to Europe already runs about $900. It's $1,200 if you include this year's sky-high fuel surcharges.

But with high oil prices and a weak dollar crippling the U.S. carriers, they may have to hitch their wagons to stronger European counterparts just to stay aloft.

[fetuskarate]

I don''t really give a s.h.i.t. who merges with who; just stop charging me for every mother.f.u.c.k.i.n.g thing.