S. HRG. 113–826 

THE AMERICAN AIRLINES/US AIRWAYS 

MERGER: CONSOLIDATION, 

COMPETITION, AND CONSUMERS 

HEARING 

BEFORE THE

SUBCOMMITTEE ON ANTITRUST, 

COMPETITION POLICY AND CONSUMER RIGHTS 

OF THE

COMMITTEE ON THE JUDICIARY 

UNITED STATES SENATE 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

MARCH 19, 2013 

Serial No. J–113–9 

Printed for the use of the Committee on the Judiciary 

( 
THE AMERICAN AIRLINES/US AIRWAYS MERGER: 

CONSOLIDATION, COMPETITION, AND CONSUMERS 
U.S. GOVERNMENT PUBLISHING OFFICE

WASHINGTON : 

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98–440 PDF 2017

S. HRG. 113–826 

THE AMERICAN AIRLINES/US AIRWAYS 

MERGER: CONSOLIDATION, 

COMPETITION, AND CONSUMERS 

HEARING 

BEFORE THE

SUBCOMMITTEE ON ANTITRUST, 

COMPETITION POLICY AND CONSUMER RIGHTS 

OF THE

COMMITTEE ON THE JUDICIARY 

UNITED STATES SENATE 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

MARCH 19, 2013 

Serial No. J–113–9 

Printed for the use of the Committee on the Judiciary 

( 
(II) 

COMMITTEE ON THE JUDICIARY 

PATRICK J. LEAHY, Vermont, Chairman 

DIANNE FEINSTEIN, California 

CHUCK SCHUMER, New York 

DICK DURBIN, Illinois 

SHELDON WHITEHOUSE, Rhode Island 

AMY KLOBUCHAR, Minnesota 

AL FRANKEN, Minnesota 

CHRISTOPHER A. COONS, Delaware 

RICHARD BLUMENTHAL, Connecticut 

MAZIE HIRONO, Hawaii 

CHUCK GRASSLEY, Iowa, Ranking Member 

ORRIN G. HATCH, Utah 

JEFF SESSIONS, Alabama 

LINDSEY GRAHAM, South Carolina 

JOHN CORNYN, Texas 

MICHAEL S. LEE, Utah 

TED CRUZ, Texas 

JEFF FLAKE, Arizona 

BRUCE A. COHEN, Chief Counsel and Staff Director 

KOLAN DAVIS, Republican Chief Counsel and Staff Director 

SUBCOMMITTEE ON ANTITRUST, COMPETITION POLICY AND CONSUMER RIGHTS

AMY KLOBUCHAR, Minnesota, Chairman 

CHUCK SCHUMER, New York 

AL FRANKEN, Minnesota 

CHRISTOPHER A. COONS, Delaware 

RICHARD BLUMENTHAL, Connecticut 

MICHAEL S. LEE, Utah, Ranking Member 

LINDSEY GRAHAM, South Carolina 

CHUCK GRASSLEY, Iowa 

JEFF FLAKE, Arizona 

CRAIG KALKUT, Democratic Chief Counsel 

ROB PORTER, Republican Chief Counsel 
(III) 

C O N T E N T S 

MARCH 19, 2013, 10:03 A.M. 

STATEMENTS OF COMMITTEE MEMBERS 

Page 

Klobuchar, Hon. Amy, a U.S. Senator from the State of Minnesota ................... 1 

Lee, Hon. Michael S., a U.S. Senator from the State of Utah ............................. 3 

statement .......................................................................................................... 191 

WITNESSES 

Witness List ............................................................................................................. 43 

Horton, Thomas, Chairman, President, and Chief Executive Officer, American 

Airlines and AMR Corporation, Fort Worth, Texas .......................................... 6 

prepared statement .......................................................................................... 44 

McGee, William J., Consultant, Consumers Union, New York, New York ........ 11 

prepared statement .......................................................................................... 64 

Moss, Diana L., Ph.D., Director and Vice President, American Antitrust 

Institute (AAI), Washington, DC ........................................................................ 9 

prepared statement .......................................................................................... 53 

Parker, Douglas, Chairman and Chief Executive Officer, US Airways Group, 

Tempe, Arizona .................................................................................................... 7 

prepared statement .......................................................................................... 44 

QUESTIONS 

Questions submitted to Thomas Horton by: 

Senator Blumenthal ......................................................................................... 90 

Senator Klobuchar ............................................................................................ 80 

Senator Lee ....................................................................................................... 85 

Questions submitted to William J. McGee by: 

Senator Klobuchar ............................................................................................ 82 

Senator Lee ....................................................................................................... 88 

Questions submitted to Diana L. Moss by: 

Senator Blumenthal ......................................................................................... 91 

Senator Klobuchar ............................................................................................ 81 

Senator Lee ....................................................................................................... 87 

Questions submitted to Douglas Parker by: 

Senator Blumenthal ......................................................................................... 92 

Senator Klobuchar ............................................................................................ 78 

Senator Lee ....................................................................................................... 83 

ANSWERS 

Responses of Thomas Horton to questions submitted by Senators Blumenthal, 

Klobuchar, and Lee .............................................................................................. 93 

Responses of William J. McGee to questions submitted by Senators Klobuchar 

and Lee ................................................................................................................. 102 

Responses of Diana L. Moss to questions submitted by Senators Blumenthal, 

Klobuchar, and Lee .............................................................................................. 108 

Responses of Douglas Parker to questions submitted by Senators Blumenthal, 

Klobuchar, and Lee .............................................................................................. 116 
Page

IV 

MISCELLANEOUS SUBMISSIONS FOR THE RECORD 

Alioto, Joseph M., Attorney, San Francisco, California, statement ..................... 133 

Allied Pilots Association (APA) Government Affairs Committee, Capt. Robert 

Coffman, Chairman, statement ........................................................................... 135 

American Federation of State, County and Municipal Employees (AFSCME), 

Utah Local 1004, Patty Rich, Executive Director, March 14, 2013, letter ...... 316 

Anoka County, Minnesota, Scott Schulte, County Commissioner, March 14, 

2013, letter ............................................................................................................ 192 

Association for a Better New York (ABNY), Jennifer Hensley, Executive Director, March 8, 2013, letters .............................................................................. 200 

Association of Flight Attendants (AFA), Veda Shook, International President, 

statement .............................................................................................................. 131 

Association of Professional Flight Attendants (APFA), Laura R. Glading, 

President, statement ............................................................................................ 139 

Association of Professional Flight Attendants (APFA) et al., March 18, 2013, 

joint letter ............................................................................................................. 189 

Austin-Bergstrom International Airport, Texas, Jim Smith, Executive Director, March 18, 2013, letters ................................................................................. 234 

Bingman, Hon. Brian, President Pro-Tempore, Oklahoma State Senate, 

March 8, 2013, letters .......................................................................................... 209 

Business Travel Coalition (BTC), letter to United States Department of Justice and United States Department of Transportation, March 19, 2013 ......... 128 

Cameron County, Texas, County Judge Carlos H. Cascos, CPA, March 18, 

2013, letters .......................................................................................................... 242 

Central West Virginia Regional Airport Authority, R. Edison Hill, Chairman, 

March 15, 2013, letter ......................................................................................... 318 

Charlotte, North Carolina, Hon. Anthony R. Foxx, Mayor, March 15, 2013, 

letter ...................................................................................................................... 195 

Charlotte Chamber, Charlotte, North Carolina, Bob Morgan, President and 

Chief Executive Officer, March 13, 2013, letter ................................................ 194 

Charlotte Regional Partnership, Ronnie Bryant, C.Ec.D., F.M., H.L.M., President and Chief Executive Officer, March 14, 2013, letter ................................ 196 

Chicagoland Chamber of Commerce, Gerald J. Roper, President and Chief 

Executive Officer, March 15, 2013, letter, statement ....................................... 178 

City of Abilene, Texas, Hon. Norm Archibald, Mayor, March 11, 2013, letters . 231 

City of Austin, Texas, Hon. Lee Leffingwell, Mayor, March 15, 2013, letters ... 236 

City of Brownsville, Texas, Hon. Tony Martinez, Mayor, March 13, 2013, 

letters .................................................................................................................... 240

City of Cedar Rapids, Iowa, Hon. Ron J. Corbett, Mayor, March 8, 2013, 

letters .................................................................................................................... 164

City of College Station, Texas, Hon. Nancy F. Berry, Mayor, March 12, 

2013, letters .......................................................................................................... 285 

City of Corpus Christi, Texas, Hon. Nelda Martinez, Mayor, March 11, 2013, 

letters .................................................................................................................... 244

City of Dallas, Texas, Hon. Michael S. Rawlings, Mayor, March 18, 2013, 

letter ...................................................................................................................... 252 

City of Dubuque, Iowa, Hon. Roy D. Buol, Mayor, March 4, 2013, letter ........... 168 

City of Fort Worth, Texas, Hon. Betsy Price, Mayor, March 14, 2013, letter .... 256 

City of Killeen, Texas, Hon. Daniel A. Corbin, Mayor, March 8, 2013, letters .. 264 

City of Laguna Vista, Texas, Hon. Susie Houston, Mayor, March 15, 2013, 

letters .................................................................................................................... 266

City of Laredo, Texas, Hon. Raul G. Salinas, Mayor, March 13, 2013, letters .. 270 

City of Los Angeles, California, Hon. Antonio R. Villaraigosa, Mayor, March 

18, 2013, letter ..................................................................................................... 145 

City of McAllen, Texas, Hon. Richard F. Cortez, Mayor, March 18, 2013, 

letters .................................................................................................................... 279

City of Midland, Texas, Hon. W. Wesley Perry, Mayor, letters ........................... 283 

City of Philadelphia, Pennsylvania, Hon. Michael A. Nutter, Mayor, March 

18, 2013, letter ..................................................................................................... 219 

City of Philadelphia City Council, Pennsylvania, Darrell L. Clarke, President, 

March 15, 2013, letter ......................................................................................... 216 
Page

V 

City of Phoenix, Arizona, Hon. Greg Stanton, Mayor, and City of Tempe, 

Arizona, Hon. Mark W. Mitchell, Mayor, March 15, 2013, letter .................... 144 

City of Port Isabel, Texas, Hon. Joe E. Vega, Mayor, March 15, 2013, letters .. 291 

City of San Antonio, Texas, Hon. Julı ́an Castro, Mayor, March 18, 2013, 

letters .................................................................................................................... 299

City of Sioux City, Iowa, Hon. Robert E. Scott, Mayor, March 11, 2013, 

letters .................................................................................................................... 174

City of South Padre Island, Texas, Hon. Robert N. Pinkerton, Jr., Mayor, 

March 13, 2013, letters ........................................................................................ 275 

City of Texarkana, Texas, Hon. Bob Bruggeman, Mayor; City of Texarkana, 

Arkansas, Hon. N. Wayne Smith, Mayor; Texarkana Airport Authority, 

John Jarvis, Chairman; March 19, 2013, letter ................................................ 233 

City of Tulsa, Oklahoma, Hon. Dewey F. Bartlett, Jr., Mayor, March 11, 

2013, letters .......................................................................................................... 213 

City of Tyler, Texas, Hon. Barbara R. Bass, Mayor, March 8, 2013, letters ...... 307 

City of Waco, Texas, Hon. Malcolm Duncan, Jr., Mayor, March 8, 2013, 

letters .................................................................................................................... 309

City of Waterloo, Iowa, Hon. Buck Clark, Mayor, March 7, 2013, letter ............ 176 

City of Wichita Falls, Texas, Hon. Glenn Barham, Mayor, March 12, 2013, 

letters .................................................................................................................... 311

Coffman, Capt. Robert, Chairman, Allied Pilots Association (APA) Government Affairs Committee, statement draft .......................................................... 228 

Corpus Christi International Airport (CCIA), Fernando (Fred) Segundo, 

A.A.E., Director, Department of Aviation, March 12, 2013, letters ................. 246 

Crown, Lester, Chair, Transportation Committee, Civic Committee, Commercial Club of Chicago, and Henry Crown and Company, March 15, 2013, 

letter ...................................................................................................................... 180 

Dakota County Regional Chamber of Commerce, Minnesota, Ruthe Batulis, 

President, March 13, 2013, letter ....................................................................... 193 

Dallas Regional Chamber, Texas, Ambassador James C. Oberwetter, Retired, 

President and Chief Executive Officer, March 13, 2013, letters ...................... 248 

Des Moines Airport Authority, Iowa, Donald L. Smithey, Executive Director, 

March 7, 2013, letter ........................................................................................... 167 

Dubuque Regional Airport, Robert A. Grierson, A.A.E., Manager, March 6, 

2013, letter ............................................................................................................ 166 

East Texas Regional Airport, Roy H. Miller, Jr., A.A.E., Airport Director, 

March 7, 2013, letter ........................................................................................... 253 

Eastern Iowa Airport, The, Tim Bradshaw, A.A.E., Airport Director, March 

12, 2013, letters .................................................................................................... 169 

Ferriss, Bruce, and Barbara Ferriss, Spokespersons, Association of Professional Flight Attendants (APFA), and Former TWA Flight Attendants, 

statement .............................................................................................................. 150 

Florida Chamber of Commerce, David Hart, Executive Vice President, March 

18, 2013, letter ..................................................................................................... 159 

Fort Worth Chamber of Commerce, Texas, Bill Thornton, President and Chief 

Executive Officer, letters ..................................................................................... 254 

Greater Miami Convention and Visitors Bureau (GMCVB), William D. Talbert 

III, President and Chief Executive Officer, March 15, 2013, letter ................. 161 

Greater Philadelphia Chamber of Commerce, Pennsylvania, Robert C. 

Wonderling, President and Chief Executive Officer, March 15, 2013, letter .. 218 

Greater Phoenix Chamber of Commerce, Arizona, Todd Sanders, President 

and Chief Executive Officer, March 13, 2013, letter ......................................... 142 

Greater Phoenix Economic Council, Arizona, Barry Broome, President and 

Chief Executive Officer, March 13, 2013, letter ................................................ 143 

Gregg County, Texas, County Judge Bill Stoudt, March 7, 2013, letters ........... 260 

Houston Executive Airport, Andrew D. Perry, A.A.E., Executive Director, 

letter to Hon. Amy Klobuchar, a U.S. Senator from the State of Minnesota, 

March 13, 2013 ..................................................................................................... 258 

Houston Executive Airport, Andrew D. Perry, A.A.E., Executive Director, 

letter to Hon. Michael S. Lee, a U.S. Senator from the State of Utah, 

March 18, 2013 ..................................................................................................... 259 

Illinois Manufacturers’ Association (IMA), Gregory W. Baise, President, letter 179 

Jack Brooks Regional Airport, Beaumont, Texas, Alex Rupp, Airport Director, 

March 19, 2013, letters ........................................................................................ 238 

JetBlue Airways Corporation, Robert C. Land, Senior Vice President Government Affairs and Associate General Counsel, March 18, 2013, letter ............. 182 
Page

VI 

Kanawha County, West Virginia, W. Kent Carper, Commissioner, March 15, 

2013, letter ............................................................................................................ 322 

Land, Robert C., Senior Vice President Government Affairs and Associate 

General Counsel, JetBlue Airways, March 18, 2013, letter ............................. 221 

Laredo International Airport, Texas, Jose Luis Flores, Airport Manager, 

March 13, 2013, letters ........................................................................................ 268 

Los Angeles Area Chamber of Commerce, California, Gary Toebben, March 

18, 2013, letter ..................................................................................................... 147 

Los Angeles County Economic Development Corporation (LAEDC), David 

Flaks, Chief Operating Officer, March 13, 2013, letter .................................... 148 

Lubbock Preston Smith International Airport, James W. Loomis, A.A.E., Executive Director, March 15, 2013, letters ........................................................... 273 

McAllen International Airport, Texas, Philip K. Brown, Director of Aviation, 

March 18, 2013, letters ........................................................................................ 277 

Midland International Airport, Texas, Marv Esterly, Director of Airports, 

March 18, 2013, letters ........................................................................................ 281 

Miami-Dade County, Florida, Hon. Carlos A. Gimenez, Mayor, March 18, 

2013, letter ............................................................................................................ 163 

New York Building Congress (NYBC), Richard T. Anderson, President, March 

18, 2013, letter ..................................................................................................... 202 

North Texas Commission, Mabrie Jackson, President and Chief Executive 

Officer, March 6, 2013, letters ............................................................................ 289 

Partnership for New York City, Kathryn S. Wylde, President and Chief Executive Officer, March 15, 2013, letter .................................................................. 203 

Pennsylvania Chamber, Gene Bar, President and Chief Executive Officer, 

March 15, 2013, letter ......................................................................................... 215 

Rio Grande Valley Partnership, Texas, Julian Alvarez, President and Chief 

Executive Officer, March 15, 2013, letters ......................................................... 293 

Salt Lake Airport Authority Board, Utah, Mike Zuhl, Member, letter ............... 317 

San Angelo Regional Airport, Texas, Luis E. Elguezabal, A.A.E., Airport 

Director, March 18, 2013, letters ........................................................................ 295 

Shannon, Hon. T.W., Speaker, Oklahoma State House of Representatives, 

March 14, 2013, letter ......................................................................................... 208 

Sioux Gateway Airport, Iowa, David Bernstein, Board President, March 11, 

2013, letters .......................................................................................................... 172 

South Padre Island Chamber of Commerce, Texas, Roxanne Guenzel, President and Chief Executive Officer, March 18, 2013, letters ............................... 303 

State Chamber of Oklahoma, Fred S. Morgan, President and Chief Executive 

Officer, March 11, 2013, letters .......................................................................... 206 

State of Arizona, Hon. Janice K. Brewer, Governor, March 15, 2013, letter ..... 141 

State of North Carolina, Hon. Pat McCrory, Governor, March 13, 2013, letter . 197 

State of North Carolina, Sharon Decker, Secretary, Department of Commerce, 

letter ...................................................................................................................... 198 

State of Oklahoma, Hon. Mary Fallin, Governor, March 6, 2013, letter ............ 205 

State of Texas, Hon. David Dewhurst, Lieutenant Governor, March 18, 2013, 

letter ...................................................................................................................... 272 

State of Texas, Hon. Rick Perry, Governor, March 19, 2013, letter .................... 257 

State of West Virginia, Hon. Earl Ray Tomblin, Governor, March 22, 2013, 

letter ...................................................................................................................... 320 

Straus, Hon. Joe, Speaker, Texas State House of Representatives, March 

13, 2013, letters .................................................................................................... 305 

Tulsa Regional Chamber, Michael S. Neal, C.C.E., C.C.D., President and 

Chief Executive Officer, March 14, 2013, letters ............................................... 211 

U.S. Airline Pilots Association (USAPA), Gary Hummel, President, March 

18, 2013, letter ..................................................................................................... 199 

U.S. Airline Pilots Association (USAPA), Capt. Gary Hummel, President, 

statement .............................................................................................................. 313 

Village of Rosemont, Illinois, Hon. Brad Stephens, Mayor, letter ....................... 181 

Waterloo Regional Airport, Iowa, Bradley Hagen, Airport Director, March 

7, 2013, letter ....................................................................................................... 177 

Wonderling, Robert C., President and Chief Executive Officer, Greater Philadelphia Chamber of Commerce, Pennsylvania, March 15, 2013, letter ........... 138 
Page

VII 

ADDITIONAL SUBMISSIONS FOR THE RECORD 

Submissions for the record not printed due to voluminous nature, previously 

printed by an agency of the Federal Government, or other criteria 

determined by the Committee, list ..................................................................... 324 

Ferriss, Bruce, and Barbara Ferriss, Spokespersons, Association of Professional 

Flight Attendants (APFA), and Former TWA Flight Attendants, additional 

submission: 

http://twajustice.com/senatelexhibits.html ................................................. 324 

Mitchell, Kevin, Chairman, Business Travel Coalition, statement: 

http://judiciary.house.gov/hearings/113th/02262013l2/ 

Mitchell%2002262013.pdf ............................................................................. 324 

Moss, Diana L., Ph.D., Director and Vice President, American Antitrust 

Institute (AAI), additional submission: 

http://www.antitrustinstitute.org/∼antitrust/sites/default/files/ 

AAIlBTClUSAir-AAlWhite%20Paperl8-7.pdf .................................... 324 

(1) 

THE AMERICAN AIRLINES/US AIRWAYS 

MERGER: CONSOLIDATION, 

COMPETITION, AND CONSUMERS 

TUESDAY, MARCH 19, 2013 

UNITED STATES SENATE, 

SUBCOMMITTEE ON ANTITRUST, COMPETITION POLICY

AND CONSUMER RIGHTS, 

COMMITTEE ON THE JUDICIARY, 

Washington, DC. 

The Subcommittee met, pursuant to notice, at 10:03 a.m., in 

Room SD–226, Dirksen Senate Office Building, Hon. Amy 

Klobuchar, Chairman of the Subcommittee, presiding. 

Present: Senators Klobuchar, Schumer, Blumenthal, Lee, 

Graham, and Flake. 

Also present: Senator Cruz. 

OPENING STATEMENT OF HON. AMY KLOBUCHAR, 

A U.S. SENATOR FROM THE STATE OF MINNESOTA 

Chairman KLOBUCHAR. Okay. We will call the hearing to order 

today for the Antitrust Subcommittee. I want to thank everyone for 

being here today for my first Subcommittee hearing as the Chairman of this Subcommittee, and Senator Lee, who is the Ranking 

Member, is an old hand at this, but we thank all of you for coming 

today. 

I have long been concerned about the consolidation in the airline 

industry. For me it was highlighted in 2008 when my hometown 

airline, Northwest Airlines, merged with Delta. At that time, it was 

widely predicted that that merger would usher in a wave of consolidation, and several mergers later, here we are with a large deal 

that would combine two of the Nation’s largest network carriers. 

Five years ago, we had six major carriers, and should this merger 

be approved, we will be down to three. 

On February 14th, Valentine’s Day, American Airlines and US 

Airways announced their proposal to merge. If the merger goes 

through, the new American Airlines would be the Nation’s largest 

carrier and result in the four top airlines controlling approximately 

80 percent of the domestic airline market, and that includes Southwest. 

I approach this hearing with an understanding of the enormous 

challenges that the airlines industry has faced over the years. The 

attacks on September 11th, ever-increasing fuel costs in a volatile 

market, and the economic downturn have all put airlines to the 

test. There is also significant global competition which creates in-
2 

centives to merge. I get that. But I also know that a strong and 

vibrant airline industry is critical to our country. Safe, reliable, and 

affordable air travel is essential to communities large and small. 

Strong air service attracts businesses and tourists, and that results 

in economic growth and jobs. 

But given how critical the airline industry is to the U.S. commerce and to public safety, we need to be vigilant in examining any 

potential challenges this merger might create, particularly in the 

context of affordability and accessibility of air service. 

With this merger coming on the heels of major airline consolidation—that would be Delta/Northwest, United/Continental, Frontier/ 

Republic, and Southwest/AirTran—this Subcommittee and the Justice Department must review the concentration in the industry and 

what that means for services and prices, as well as airport accessibility in less popular but just as important destinations, particularly in rural areas. 

Baggage fees, change fees, and seating fees are pervasive and increasing in the industry. Last year, legacy carriers took in more 

than $10 billion in fees. With fewer competing airlines, can we expect even more of these extra charges? Are the few low-cost carriers that remain enough to keep what would be the three legacy 

carriers in Southwest in check? And we need to know that fewer 

airlines will not mean fewer flights and diminished services for the 

airports that are not the major hubs. 

There will always be ample competition between major cities like 

New York, Chicago, and Los Angeles. We all know that. But what 

about cities like Minneapolis or cities like Cincinnati, Memphis, 

Milwaukee, and Pittsburgh? What about a city like Rochester, Minnesota, home of the Mayo Clinic, that is currently served by American Airlines? Service to all metropolitan areas and mid-size and 

small cities is more important than ever. Yet we have seen reduced 

service to certain mid-sized cities. 

We appreciate the goals here, the stated promise of complementary flight networks, increased efficiency, and offering more options 

for customers. But consumers have a right to be skeptical. When 

we have one fewer choice on that matrix of flight options while 

searching for fares on the Internet, consumers cannot help but 

wonder: Would an added competitor be fighting a little harder to 

get my business at a lower price? Or would an added competitor 

be able to offer me more convenient flight times connecting through 

a different hub? 

More important than the convenience issues is the potential impact on jobs. It is no small feat that the major unions here have 

supported the merger. Still, what we have seen with past airline 

mergers gives us reason for caution. I will say my home State of 

Minnesota was fortunate in that we retained most, but not all, of 

the jobs in Minnesota following the Delta/Northwest merger. Delta 

is a major employer in our State, and we are proud of that. But 

in the wake of similar mergers, not every State has been so lucky. 

Mr. Parker and Mr. Horton, we understand and appreciate your 

reasons for advancing this merger. It is good for your bottom lines, 

and at the end of the day, you have to answer to your shareholders, 

and you are competing in a global marketplace. But on this Subcommittee, we have to get answers for the people of this country. 
3 

Whether it is the American family looking for an affordable trip to 

Disneyland or looking to visit their grandma in Pittsburgh, or 

whether it is a small business owner looking for the best frequent 

flyer program, they want as many possible choices, and they want 

choices at affordable prices. And they want to know that no airline 

or no small group of airlines gains a stranglehold on the market. 

That is the reason we are here today, and I look forward to hearing 

your thoughts and the thoughts of our other two witnesses, and we 

thank you for being here. 

I now turn it over to the Ranking Member, Senator Lee. 

OPENING STATEMENT OF HON. MICHAEL S. LEE, 

A U.S. SENATOR FROM THE STATE OF UTAH 

Senator LEE. Thank you, Madam Chair. Thanks to all of you for 

joining us today. 

The U.S. airline industry touches the lives of almost every American in some way or another. These airlines allow us to travel for 

business and for leisure, to meet new people and to reunite with 

loved ones. 

Air travel is also an important element of our national infrastructure, and it is critical to our economy. One in eight American 

jobs depends in one way or another on travel and tourism, and analysts estimate that U.S. travel expenditures will total more than 

$850 billion in 2013. 

For all these reasons, Congress must take seriously any activity 

that will seriously and materially affect the airline industry. 

Our country has benefited greatly from airline deregulation ever 

since that began in 1978. Government control of this industry, like 

Government management of any private enterprise, had unfortunate results. In the years since deregulation, airfares have dropped 

substantially, and options for travelers have simultaneously expanded. These benefits are the result of free market competition 

and will continue as long as the industry remains robustly competitive. 

Despite the positive benefits of deregulation, the story of our Nation’s airlines in recent decades is not one of unbroken, unmitigated success. Uneven earnings, volatile fuel costs, and structural 

changes have led to a long succession of airline bankruptcies. As 

Federal agencies have provided assistance and assumed responsibility for many pension plans, as a result of those airline bankruptcies, the financial stability of the airline industry is one of special concern. 

To help cope with changing circumstances, airlines have turned 

to consolidation. In the last decade alone, we have seen no fewer 

than six significant airline mergers in this country, and today we 

consider the seventh major merger, which would be an $11 billion 

transaction. 

The combined American and US Airways would employ nearly 

120,000 people, would have 2012 revenues of almost $40 billion, 

and fly 950 jets to approximately 900 locations. The merger would 

leave only four airlines with significant national networks, and 

those carriers would control over 80 percent of the domestic market. 
4 

As a result, our Subcommittee, which is tasked with oversight in 

competition policy and consumers rights, must conduct a thorough 

examination of this transaction. 

The Department of Justice will, of course, review the proposed 

merger under the Hart-Scott-Rodino Act, applying an analytical 

framework set forth in the horizontal merger guidelines to assess 

the anticompetitive effects of reduced competition in relevant markets, identify any increased barriers for entry on future competitors, and consider efficiencies and benefits that may flow from this 

consolidation. 

As I have noted in previous hearings on this Subcommittee, several principles guide my approach to antitrust law. Most importantly, we must remember the late Robert Bork’s insight that the 

purpose of our antitrust laws is to maximize consumer welfare. We 

seek, therefore, to protect competition rather than to protect competitors. 

Government may sometimes have a proper role in ensuring that 

a company does not obtain undue market power, but it is important for Federal agencies to—it is improper, rather, for Federal 

agencies to pick winners and losers in the marketplace, and absent 

evidence that a transaction will substantially reduce competition 

and thereby harm consumers, I believe Government intervention is 

usually unwarranted. 

Mergers are an essential element of our rapidly changing economy, often creating significant efficiencies and helping to ensure 

that resources are put to their most productive possible use. I believe this merger holds the promise of cost savings through combining complementary assets, reducing duplicative operating expenses, and integrating computer systems as well as airline fleets. 

In a competitive market, consumers benefit from such efficiencies 

in the form of higher-quality services, like an expanded route network at lower prices. 

Likewise, some industry experts suggest that the domestic market will benefit if comprised of a few large but economically stable 

and competitive airlines. 

Others, however, have expressed concern that a post-merger 

American, the largest domestic carrier, could exercise undue market power, leading to higher prices and even reduced services to 

certain communities in America. They argue that past airline 

mergers have created capacity reductions and price increases on 

some routes from the combined airlines’ hubs. 

Many of my constituents in Utah complain about high fares flying into and out of Salt Lake City. Critics fear that this merger will 

likewise allow American to raise prices on certain of its routes and 

that, despite barriers to entry, will provide other—and that increased barriers on entry will prevent other carriers from providing 

competitive discipline. 

As one example, they note that just a few miles down the road 

from here at Reagan National Airport, a combined American and 

US Airways would control nearly 70 percent of all passenger gate 

slots, making effective competition from rivals very difficult to 

achieve. 

These are important issues, and I thank Senator Klobuchar, the 

Chair of this Subcommittee, for holding this hearing. By carefully 
5 

weighing the evidence and engaging in rigorous analysis, we help 

ensure a competitive marketplace that maximizes consumer welfare and in the end allows our economy to thrive. I look forward 

to hearing the testimony from each of you today, and I thank you 

for being here. 

Chairman KLOBUCHAR. Well, thank you very much, Senator Lee. 

I first want to note that we have received written testimony as 

well as numerous submissions for the record, including letters from 

local communities, a joint letter from several labor unions involved 

in the merger that support it—that is, the Association of Professional Flight Attendants, the Transport Workers Union, the Allied 

Pilots Association, US Airlines Pilots Association, and Association 

of Flight Attendants. 

We also have testimony from the Business Travel Coalition, and 

we also have testimony from the TWA flight attendants who have 

some concerns, and many other submissions. All materials will be 

included in the record, and the record will remain open for 1 week 

following the hearing for any additional submissions. 

[The information referred to appears as submissions for the 

record.] 

Chairman KLOBUCHAR. Now I would like to introduce our panel 

of witnesses. 

Our first witness to testify will be Mr. Douglas Parker. Mr. 

Parker has been chairman and chief executive officer of US Airways since 2005. Before joining US Airways, Mr. Parker served as 

president and CEO of American West Airlines. Actually, he will be 

the second witness to testify even though he is first in the line. 

Our first witness to testify will be Mr. Thomas Horton, who is 

the chairman and chief executive officer of AMR Corporation and 

American Airlines. He is also the current chairman of the oneworld 

Global Airline Alliance. Prior to becoming CEO in 2011, Mr. Horton 

served as president of AMR and American and also held a number 

of positions with the airline. Before that, he served as chief financial officer and vice chairman of AT&T. 

Our third witness testifying today is Dr. Diana Moss, the director 

and vice president of the American Antitrust Institute, as well as 

adjunct faculty in the Department of Economics and Interdisciplinary Telecommunications Program at the University of Colorado at 

Boulder. Prior to joining AAI in 2001, Dr. Moss was a senior staff 

economist at the Federal Energy Regulatory Commission. 

Finally, we have with us Mr. William McGee. Mr. McGee is a 

journalist, writer, and consumer advocate who serves as a consultant on aviation and travel issues for Consumers Union. He is a 

former editor-in-chief of Consumer Reports’ travel letter. He is also 

a member of the Department of Transportation Future of Aviation 

Advisory Committee. 

Thank you for appearing before our Subcommittee today. I now 

ask all of our witnesses to rise and raise their right hand as I administer the oath. 

Do you affirm that the testimony you are about to give before the 

Committee will be the whole truth, the truth, and nothing but the 

truth, so help you God? 

Mr. HORTON. I do. 

Mr. PARKER. I do. 
6 

Ms. MOSS. I do. 

Mr. MCGEE. I do. 

Chairman KLOBUCHAR. Thank you. 

Now we will begin our testimony with Mr. Thomas Horton. 

STATEMENT OF THOMAS HORTON, CHAIRMAN, PRESIDENT, 

AND CHIEF EXECUTIVE OFFICER, AMERICAN AIRLINES AND 

AMR CORPORATION, FORT WORTH, TEXAS 

Mr. HORTON. Good morning, Chairman Klobuchar, Senator Lee, 

and Members of the Subcommittee. I appreciate the invitation to 

testify and would like to explain why this merger will have such 

a positive outcome for our customers, our people, and our financial 

stakeholders. 

Thanks to the extraordinary efforts of our people, many of whom 

are with us here today, American is on the verge of completing one 

of the most successful corporate restructurings ever. We have renegotiated debt and leases, optimized our fleet and facilities, and 

have achieved certainty and stability with labor contracts in place 

with each of our labor unions. We have also strengthened our network and our oneworld Alliance partnerships and invested in leading products and services and a new and modern fleet to better deliver for our customers. 

We expect our bond holders to receive a full recovery and the 

former AMR shareholders to own a share in the combined company, with additional upside if the stock appreciates in value. 

This is quite an unusual outcome. We are proud of this result, 

and now that we have put our own house in order, our merger with 

US Airways will create a new American Airlines, a global competitor worthy of our name as America’s flag carrier. Flying under the 

iconic American Airlines brand, it will be positioned to compete not 

just against other domestic carriers but against the best the world 

has to offer. 

Our journey to this day has been challenging, to say the least. 

Over the past decade, our industry has experienced extraordinary 

economic headwinds. While almost every other legacy carrier used 

the bankruptcy process early on to lower their costs, American 

fought valiantly to avoid doing so. 

In 2003, American and our unions reached consensual agreements to reduce costs without having to file for restructuring. However, our major competitors subsequently went down the restructuring path, surpassing the savings we achieved, which gave them 

a singular—a significant advantage. 

We also experienced a new wave of powerful competition from 

the growth of low-cost carriers, and importantly, Delta, Northwest, 

United, Continental, Southwest, and AirTran further strengthened 

their positions through mergers. 

In the face of this competitive challenge, we made great progress 

in expanding our international alliances, finally securing antitrust 

immunity for our own joint ventures with oneworld Partners, British Airways, Iberia, Japan Airlines, and LAN Airlines. We signed 

the largest ever aircraft order, and we now have 500 new aircraft 

on order and options for 500 more, which will dramatically improve 

fuel efficiency, reduce emissions, and offer state-of-the-art comfort 

for our customers. 
7 

Despite these efforts, however, our costs remained uncompetitive, and after a decade of losses that reached $12 billion, in November 

2011 our board concluded that the way forward was to restructure 

as most of our competitors had done. 

As difficult as restructuring has been, it was the right decision. 

We began with the explicit philosophy that the restructuring would 

be fair and equitable within the company. We started by shrinking 

senior management by a third. While we achieved substantial cost 

savings through long-term agreements with our labor unions, we 

were still able to grant pay increases and provide retirement incentives to reduce the involuntary job losses. 

We also worked with our Creditors’ Committee, including the 

PBGC, to assure that the accrued pension benefits to our people 

will be paid rather than handed over to the PBGC, as others have 

done. 

The hard work developing our network, our products, and our 

customer experience helped us achieve record revenue, topping our 

U.S. peers in year-over-year revenue growth for 6 straight months 

is 2012. 

Once we had a line of sight on how strong the restructured 

American could be, we concluded it was the right time to consider 

a merger. Hence, last summer, in collaboration with our board and 

our Creditors’ Committee, American began to look at merger alternatives using a fact-based, disciplined process. Everyone involved, 

including labor unions at both companies, and our Ad Hoc Committee of bond holders agreed that a merged American and US Airways would deliver a range of benefits and improve stability in our 

industry that greatly needs it. 

Last month, we announced a deal that would give American’s financial stakeholders 72 percent and US Airways’ shareholders 28 

percent of the combined company. The new American will take 

flight in what continues to be one of the most intensive—intensely 

competitive industries in the world, and there is nothing the people 

of American want more than to put American back on top as a 

fierce competitor and set a new standard of excellence, and that is 

exactly what this merger will do. 

I am optimistic about our future and pleased to partner with my 

long-time friend Doug Parker to make that vision a reality. 

Thank you again for this opportunity to address the Subcommittee, and I stand ready to answer your questions. 

[The prepared statement of Thomas Horton appears as a submission for the record.] 

Chairman KLOBUCHAR. Thank you, Mr. Horton. 

Mr. Parker. 

STATEMENT OF DOUGLAS PARKER, CHAIRMAN AND CHIEF 

EXECUTIVE OFFICER, US AIRWAYS GROUP, TEMPE, ARIZONA 

Mr. PARKER. Good morning, Chairman Klobuchar, Ranking Member Lee, Members of the Subcommittee. Thank you for the opportunity to testify today about the merger of US Airways and American Airlines, creating the world’s best airline through a combination that will be good for competition, consumers, and choice. 

My name is Doug Parker. I am chairman and chief executive officer of US Airways. Our team operates over 3,000 flights per day, 
8 

connecting some 80 million passengers per year to more than 200 

communities large and small, primarily through our hubs in Charlotte, Philadelphia, Phoenix, and here in Washington, DC. I want 

to begin by thanking all of our employees who are here today to 

support this merger, including pilots and flight attendants in uniform from American and US Airways, who know that this transaction represents a brighter future for our 100,000 employees. I am 

proud to be here representing them and extremely grateful for 

their support, so thank you all very much. 

This merger will benefit our customers, our employees, our 

shareholders, and the communities we serve by integrating the 

complementary networks of American Airlines and US Airways 

into something better than either airline can offer on its own. It 

will enhance competition in what is already a vigorously competitive marketplace. Passengers and communities will benefit from 

more and better service. Employees will receive improved pay, benefits, and job security. And our shareholders will benefit from the 

improved financial stability of the combined company. Because of 

these benefits, the combination has attracted unprecedented support from the employees and labor unions of both companies, the 

financial markets, and the communities we serve. 

Consumer demand is the driver for this combination, airline passengers want broader networks capable of getting them to more 

places more efficiently. In response to that demand, Delta merged 

with Northwest and United merged with Continental. Southwest 

responded to the same consumer demand when it acquired 

AirTran. All three transactions were cleared by the Justice Department because those combinations created substantial passenger 

benefits with minimal competitive overlap. By combining American 

and US Airways, the new American Airlines will build the network 

that passengers have told us they want, one that will compete more 

effectively with the other networked airlines as well as low-cost 

carriers. 

The benefits of the new American Airlines stem from the complementary nature of our operations. Out of over 900 domestic nonstop routes, American Airlines and US Airways have only 12 nonstop overlaps. By combining these networks, we will provide thousands of passengers better alternatives by creating over 1,300 new 

connecting opportunities and the potential to access numerous cities worldwide served by one carrier but not the other. 

Domestic airline markets will become even more competitive. Although it will be the largest airline in the United States, the new 

American Airlines will have less than 25 percent of domestic available seat miles and will compete against the nationwide networks 

of Delta, with 21 percent share; United, with 19 percent; and 

Southwest, with 19 percent. The new American Airlines will also 

compete against Southwest’s significant lower cost structure and a 

host of actual smaller but fast-growing, lower-cost airlines, including Jet Blue, Spirit, Allegiant, and Virgin America. 

US Airways has historically provided extensive air service to 

small and medium-sized communities, and the new American Airlines will continue that commitment as service for smaller communities that was not economical becomes possible thanks to the traffic flows across the broader network. 
9 

The best example of our commitment to smaller communities is 

the hub we have built here at Reagan National Airport where we 

use a large majority of our slots to serve small and medium-sized 

communities to ensure the benefits of our network extend beyond 

connecting large cities to the Nation’s capital. 

The new American Airlines will also be a stronger financial company. We expect to generate over $1 billion in net synergies, primarily due to increased revenues from new passengers, taking advantage of the broader network and the improved service. That improved financial performance will provide American’s bankruptcy 

creditors an enhanced opportunity for full recovery. That financial 

stability will also provide very significant benefits to our employees, including better pay and benefits, more jobs, and greatly improved job security, and better opportunities for advancement. 

Antitrust review of these issues is important, and we have been 

and will continue to work with the Justice Department to demonstrate the competitive benefits of this proposed merger. We appreciate the opportunity to address these issues with the Subcommittee today and commit to working with you in your oversight 

capacity. 

I will be happy to answer any questions at the right time. Thank 

you very much. 

[The prepared statement of Douglas Parker appears as a submission for the record.] 

Chairman KLOBUCHAR. Thank you very much. 

Dr. Moss. 

STATEMENT OF DIANA L. MOSS, PH.D., DIRECTOR AND 

VICE PRESIDENT, AMERICAN ANTITRUST INSTITUTE, 

WASHINGTON, DC 

Ms. MOSS. Thank you. I would like to thank Madam Chairwoman, Senator Klobuchar, Ranking Member Senator Lee, and the 

Members of the Subcommittee for holding this hearing on the proposed merger of US Airways and American. 

Chairman KLOBUCHAR. Is your mic on? 

Ms. MOSS. My mic is on now. I apologize. 

Chairman KLOBUCHAR. Excellent. Thank you. You do not have to 

address us again. 

Ms. MOSS. It is an honor to appear here today. My testimony is 

based on a white paper that was jointly produced by the American 

Antitrust Institute and the Business Travel Coalition. We conclude, 

based on analysis using publicly available information, that the 

proposed deal raises significant competitive issues that could result 

in harm to consumers. 

I would like to make briefly just a number of major points. 

First, by way of overview, the merger comes in the wake of six 

major mergers in recent years. It will speed the transformation of 

the industry from one in which hubs were designed to accommodate multiple airlines to just a few large systems, one of which includes the legacy-like Southwest, which may not longer exert much 

significant competitive discipline. In this environment, low-cost carriers and regionals would have difficulty thriving. The merger will 

increase concentration at the national or systems level, enhancing 
10 

the ease with which the big four carriers can tacitly coordinate on 

systemwide capacity tightening in order to maintain fares. 

Combining the two networks would also create functional strongholds throughout the U.S., including major airports on the eastern 

seaboard, in the Midwest, and West that are important for providing connecting service to eastern and western destinations. 

My second point is the importance of considering the effects of 

previous legacy mergers. The similarities between USAir and 

Delta/Northwest and United/Continental make a very strong case 

for why a postmortem analysis should inform this merger. Several 

routes affected by those deals are among the largest city pair markets in the U.S. Both mergers substantially eliminated competition 

on key hub-to-hub routes, many of which experienced the exit of 

low-cost carriers and regionals and also pre- to post-merger fare increases. Such post-merger effects have come under strong public 

scrutiny, and similarities between these and the USAir deal make 

a strong case for why the merger deserves a careful look. 

A third issue is that the combination is likely to affect a number 

of important route-level markets. Over one-half of the overlap 

routes potentially affected by the merger would be entirely or nearly monopolized. Similar to previous mergers, USAir would create a 

dominant firm that could raise fares and restrict service, particularly since the carriers are likely each other’s closest competitors. 

The merger could also increase the risk that the remaining few legacies on affected routes could coordinate on fares or capacity, and 

low-cost carriers would no longer have as strong an incentive to 

maintain aggressive pricing. 

Fourth, low-cost carriers can no longer be relied upon to save the 

day for legacy mergers. The dwindling stock of LCCs make them 

increasingly unreliable as a source of competitive discipline in the 

industry. They may find it more difficult to enter and discipline 

legacy-dominated hubs. And in cities affected by the proposed 

merger where LCCs have a presence at secondary airports, that 

service may not provide good substitutes for consumers. 

Fifth, many mid-sized communities have seen flight frequencies 

reduced as a result of previous mergers. Evidence from previous 

deals indicates that carriers have driven traffic to large hubs, probably to feed global operations. That has the potential side effect of 

starving routes involving smaller cities. 

Choice and availability are very important variables in the antitrust analysis of transportation networks. Mergers that force consumers in smaller communities to use less convenient connecting 

service or travel longer distances to other airports are legally cognizable effects of a merger. 

Sixth, there is an ongoing debate over efficiencies in airline 

mergers. This includes economic analysis showing that cost savings 

dwindle as networks get larger and the effects of increased 

‘‘hubbing’’ on congestion and costs. Post-merger system integration 

problems should also be considered since they impose costs on the 

merged company that may be passed on to customers. 

In network industries, it is tempting to sell a merger on the basis 

of ‘‘out of market’’ efficiencies or savings that may occur in a part 

of the system that is far removed from where competitive harm is 

inflicted. Given the magnitude of harm that could flow from this 
11 

combination, efficiencies should be tied directly to adversely affected markets. 

Finally, the latest round of airline industry consolidation has 

been accompanied by carriers aggressively unbundling their 

prices—their products. However, price transparency for ancillary 

services is currently lacking. That means ancillary fees go largely 

undisciplined by market forces and prevent consumers from efficient comparison shopping for air travel offerings. 

The proposed merger would further reduce the rivalry that creates incentives for sellers to engage in price transparency, instead 

enhancing the ease with which airlines can tacitly agree on ancillary fees. 

In sum, the merging parties bear a heavy burden in demonstrating that their merger would not be harmful to competition 

and consumers. 

Thank you for this opportunity to testify, and I stand ready to 

answer your questions. 

[The prepared statement of Diana L. Moss appears as a submission for the record.] 

Chairman KLOBUCHAR. Thank you very much, Dr. Moss. 

Mr. McGee. 

STATEMENT OF WILLIAM J. MCGEE, CONSULTANT, 

CONSUMERS UNION, NEW YORK, NEW YORK 

Mr. MCGEE. Thank you, Chairwoman Klobuchar, Ranking Member Lee, and Members of the Subcommittee. 

This is not the first time in recent years that this Subcommittee 

is examining a merger between two major domestic network airlines and hearing the fears and frustrations of passengers as our 

Nation’s commercial aviation industry becomes ever more concentrated. No doubt today’s hearing is invoking de ́ja` vu for many 

of us here. Indeed, such hearings have become almost a biennial 

or triennial event over the past decade as we have watched the 

eight major network airlines of 2001 dwindle down to four in 2010. 

And if this merger goes through, there will be three. The US Airways brand will be retired, joining Continental, Northwest, America West, TWA, Pan-Am, Eastern, and the many others that have 

disappeared in the deregulated era. 

Once again we are being told that this merger is the key to saving the airline industry, that if only American and US Airways be 

allowed to join forces, order will be restored to a chaotic business, 

that an unprofitable industry will operate in the black, that consumers will be better served, and that somehow with fewer, rather 

than more, major airlines competition will be miraculously enhanced. Frankly, we are not so sure. 

We are concerned that allowing American and US Airways to 

combine could bring great harm to millions of airline passengers 

and numerous communities. We are concerned that there could be 

reduced service with fewer flights on some routes, elimination of 

nonstop service, and replacement of mainline jets with outsourced 

regional carriers, as has happened with past airline mergers. 

We are concerned that entire cities and even regions could lose 

the vital transportation links provided by hub operations. Analysts 
12 

already are speculating about the future of US Airways hubs in 

Philadelphia, Charlotte, and Phoenix. 

Civic leaders can attest to how recent mergers have harmed communities that used to be served by TWA’s former hub in St. Louis, 

America West’s former hub in Las Vegas, Delta’s shrinking hub in 

Cincinnati, and Continental’s former hub in Cleveland. 

We are concerned that higher fares could result on routes where 

healthy competition is lost as fewer airlines mean less reason to resist fair hikes. Again, we have seen it happen with other airline 

mergers. 

We are concerned that service quality could fall as less competition means less incentive to innovate and improve. Compound that 

with the difficulties of uniting two work forces, two fleets, two operational systems, and two business cultures. Meanwhile, two frequent-flier programs would become one with a much larger pool of 

passengers fending for fewer available seats and upgrades. 

We are concerned that as the few remaining major airlines hunker down around their fortress hubs, it could become increasingly 

difficult for startup carriers to enter the market and provide effective new competition. And we are concerned that as the major airlines become bigger and fewer, they increasingly will be regarded 

as ‘‘too big to fail.’’ 

We have witnessed an incredibly shrinking airline industry in the years since the Federal Government gave the airlines a $5 billion bailout in 2001, and each successive merger just raises the 

stakes. Could the President or Congress stand idly by if a bankruptcy filing, a labor action, a safety violation, or some other event 

threatens to disrupt up to 25 percent of our Nation’s commercial 

airlift? 

We are also concerned about where this is all heading. Will consolidation stop at the water’s edge, or will the laws prohibiting foreign ownership of U.S. airlines be repealed so that soon we are discussing proposed mega mergers between U.S. carriers and British 

Airways or Lufthansa or Air France/KLM? 

We are pleased that the Justice Department’s Antitrust Division 

is investigating, and we hope this Subcommittee will encourage 

and support a thorough investigation. We do not prejudge the legality of this merger. The airlines should have a full opportunity 

to make their case to the Justice Department. But as we explain 

in greater detail in our written statement, assurances from the airlines should be regarded with skepticism if they run counter to the 

airlines’ profit-making business incentives. There is no substitute 

for competition to keep an airline from raising fares and reducing 

service if doing so will increase its profits. 

A merger of this magnitude can dramatically change the structure of the market and fundamentally alter profit-making incentives in ways that take them further away from keeping fares low 

and improving service. 

At the conclusion of its investigation, we hope the Justice Department will fully explain its reasons for whatever actions it concludes is called for so there will be no room for doubt that we are 

being fully protected under the law. 

Our commercial airlines are as vital to America’s economy and 

security as our telecommunications networks and our interstate 
13 

highways. The stakes could not be higher for airline passengers 

facing fewer and fewer choices in a market that has become ever 

more concentrated. 

Thank you. I will be happy to answer any questions you may 

have. 

[The prepared statement of William J. McGee appears as a submission for the record.] 

Chairman KLOBUCHAR. Thank you, all of you, for your thoughtful 

testimony. 

I want to start with you, Mr. Parker and Mr. Horton. The most 

basic concept of antitrust law is that when there are fewer competitors to get customers’ business, what happens is that prices tend 

to rise, services tend to decline. 

As you know and as pointed out by Dr. Moss and Mr. McGee, we 

have a great wave of consolidation in the airline industry over the 

past 5 years. With this merger we would be down to only three network carriers. 

In your view, what is the minimum number of network carriers 

necessary for a competitive market? Would two be enough? What 

is the tipping point? And how would you argue that your merger 

in any way defies the basic concept that we see prices go up and 

services decline? 

Mr. HORTON. I will maybe start. We think that this enhances 

competition and that it creates another global airline on par with 

Delta and United. So it creates a competitive counterweight to 

those two big airlines. 

And, indeed, you know, the new American will compete in a global marketplace, so we do not just compete with Delta, United, 

Southwest, Jet Blue, the low-cost carriers here at home; but we 

also compete with the likes of Lufthansa and Emirates and Singapore around the world. So we think this is about creating a more 

competitive industry. 

Chairman KLOBUCHAR. But it is true that since 2000, there has 

only been one new carrier, I think, in our country—Virgin America—that has entered. And when you mention these other carriers, 

I think the concern is—we have Sun Country in Minnesota. We are 

proud of them. But there really has not been a new carrier that has 

been viable since the year 2000. Don’t you think there are many 

barriers to entry that make it hard for new airlines to get in to 

compete? 

Mr. HORTON. I think if you look over the last many years, there 

have been new entrants into the industry. Jet Blue is, of course, 

a great example of a company that sprang up the early part of the 

last decade and has been very successful and grown nationwide. So 

I think there are ample opportunities and capital available for new 

airlines to enter the market. 

Chairman KLOBUCHAR. I note that Jet Blue is only 5 percent of 

the market, though, and we have now these three major carriers. 

Mr. Parker, do you want to respond? 

Mr. PARKER. I would just add to Tom’s comments and say, first 

off, again, noting how complementary our two networks are, so by 

putting our two airlines together we create a third competitor to— 

actually, a fourth competitor to what are now three airlines larger 

than ours—United, Delta, and Southwest. And it allows more com-
14 

petition, not less, only 12 routes overlapping out of 900. By putting 

these two networks together, we will be able to provide better service, more efficient service to consumers. 

I would also note that in the $1 billion of synergies that I noted 

in our analysis, there is not one assumed fare increase in there. 

The synergies are not built upon assumed fare increases, rather on 

what I just said, putting two networks together that allow us to attract more customers and to attract customers in a more efficient 

way. 

And then the only other note I would make on the barriers to 

entry, the reality is that, you know, there are no barriers to entry 

today in this industry that are new in the past. I think capital is 

a barrier to entry. This is a very tough business where the legacy 

airlines have struggled for many years to actually return—to make 

a return on capital. Those that have have been more low-cost carriers. And I would note that those that exist today are growing 

much faster than the legacy airlines are, than the network carriers 

are, the Allegiants, the Alaskas, Hawaiian, Spirit, Virgin America, 

Frontier, Jet Blue, Sun Country. That is where all the growth is. 

And while there may not be any new ones added of late, there are 

plenty out there. It is an intensely competitive business, and this 

just allows us to compete better against those airlines. 

Chairman KLOBUCHAR. Okay. And as we know, a lot of that competition tends to be between these major metropolitan areas, and 

that is a concern I think Dr. Moss did a good job of raising, and 

that is this idea that for these mid-sized major metropolitan areas, 

they are not seeing as much of that competition, and just hear me 

out on this recent study. 

A research engineer from MIT’s International Center for Air 

Transportation found that between 2007 and 2012, nearly 1.7 million yearly departures were removed from the U.S. domestic system, and that a disproportionate share of cutbacks happened in 

non-large hub airports. We are talking about the non-L.A., nonNew York. Only 40 percent of U.S. departures last year were flown 

in non-large hub markets compared with 44 percent in 2007. Network carrier flights were cut on average by 27 percent in smaller 

U.S. airports. Pittsburgh, which I mentioned before, is a good example of that. They are adding headquarters and their economy is 

actually picking up, but they have seen a number of these flights 

go down and the loss of service after the US Airways/American 

West merger. 

So in your testimony, you make a renewed commitment to serve 

small and medium-sized communities, where appropriate, increase 

service and additional destinations. Can you please explain the 

qualifying language and get at this issue of while there is competition in these major cities, in many of our mid-sized cities we are 

seeing less? 

Mr. PARKER. Yes. Let me go first, Tom. 

I was happy to hear your comments that you believe that service 

to mid-cities is more important than ever. We agree. And what I 

would like to point out is the way that those cities are served is 

through hub-and-spoke carriers. The way that mid-sized and smaller communities receive air service is by having hub-and-spoke airlines like US Airways, like American, that fly into those cities and 
15 

then connect people on to other markets. There is not enough demand in many of those cities for nonstop point-to-point service. It 

needs to fly through hub-and-spoke carriers. 

So in order for us to better serve small and mid-sized communities, we need strong and vibrant hub-and-spoke carriers, and that 

is what this merger does. It takes two strong hub-and-spoke carriers, but builds one that is even stronger and provides even more 

connections. It allows, for example, for the people of Rochester, 

Minnesota, to now connect on the new American Airlines to Hilton 

Head, South Carolina. US Airways does not fly to Rochester. American does not fly to Hilton Head. But together we will. And it provides more connections for people in communities like that, and 

there are 1,300 such examples like that in this merger, people that 

do not have the ability to connect between two cities that now will 

in 1,300 different examples. 

Chairman KLOBUCHAR. Okay. I am going to ask just one more 

question, mostly because I am afraid Senator Schumer will ask this 

question if I do not when he comes, because we both have worked 

a lot on these fee issues. And I think that it was brought up by 

our witnesses here on the right side of the table that there are 

issues with transparency with these fees. In fact, I cited in my 

opening statement that we have seen $10 billion in 2012 alone for 

things like baggage fees, change fees, seating fees. And while we 

look at how these mergers in the airline industry have affected 

prices and there can be arguments that some ticket prices have 

gone down but the fees have been going up. And I think Dr. Moss 

was arguing that these mergers might make it even more difficult 

to make it transparent and how do you respond to that. And then 

I will turn it over to Senator Lee. 

Mr. HORTON. Maybe I will kick it off, Doug. We think that the 

unbundling of fares that you cite has actually been constructive 

and good for customers because it allows them to select the services 

they want and pay for what they want, and those who do not want 

to have to pay for bags or other things do not have to pay for that 

and can just buy the base fare. In fact, one of the most successful 

low-cost carriers, Spirit, has taken that approach to a whole new 

level. 

I would say about fares in particular, you know, fares have 

been—fare increases, including fees, have been very restrained. So 

if you go back to the early part of the last decade, go back to 2000, 

airfares, including fees, are up about 20 percent. Fuel prices are up 

3 times, almost 3 times. And that 20 percent is less than the actual 

rate of inflation. So we think the airline industry has done a pretty 

good job of providing value even in the face of sharp increases in 

input costs. 

Chairman KLOBUCHAR. And on my next round, I will let you guys 

respond to that, but I will turn it over to Senator Lee. Thank you. 

Senator LEE. A number of commentators have expressed concerns about the impacts that the proposed merger could have on 

certain so-called hub airports. For example, the new merged combined American Airlines would have nearly 70 percent of the available slots at Reagan National Airport. Critics suggest that this 

combined power could allow the new American Airlines to raise 

prices because competitors would not be able to compete effectively 
16 

in those airports. So I have got a couple of questions for Mr. Horton 

and for Mr. Parker on this point, and I will ask you to answer 

these in that order on each of these. 

Given that Reagan National Airport is known as a closed airport, 

one in which the number of slots is fixed and it is unlikely to 

change, at least anytime in the immediate foreseeable future, 

would American’s dominant share of available slots give it, in your 

opinion, an undue advantage in the marketplace that could lead to 

increased prices as a result of that undue influence on the market? 

Mr. HORTON. Well, we do not think so, and that is because the 

Washington area, of course, is served by three airports, and if you 

look at the market as a whole, taking into account all three airports, the new American would have something on the order of 25 

percent of the capacity. So we think it is a robust and competitive 

marketplace. 

Senator LEE. Mr. Parker. 

Mr. PARKER. I agree completely. I would point out, even in 

Reagan the number of slots I do not think is the right measure to 

look at for capacity. It is actually the number of seats. Because we 

serve so many small and mid-sized communities out of Reagan 

versus our competitors, the number—while we have about twothirds of the slots at Reagan, we have about 50 percent of the 

seats. And as Tom notes, this is a market that is intensely competitive, not just because of Reagan but because of Baltimore—because 

of BWI and Dulles. And when you add those together, the new 

American would be smaller than United, about the exact same size 

as Southwest Airlines in this market. 

Senator LEE. You are not suggesting the slot question is irrelevant, though? You are just suggesting it is perhaps mitigated by 

the number of seats? 

Mr. PARKER. Oh, absolutely not, I am not suggesting it is irrelevant. It is an issue that should be addressed, and we are happy to 

have it addressed. I believe that as the Committee and the Justice 

Department look at the slot issue, they will come to the same conclusion we have, which is the slots that are utilized by—that will 

be utilized by the new American are used to provide service to 

smaller communities, that if other airlines were given those slots, 

they would not go to similar size communities, they would be flown 

to larger markets. I think that would be bad for consumers. 

Senator LEE. Okay. The second part of my question on this slot 

issue relates to what happened last year when USAir and Delta executed a swap agreement for a number of slots at LaGuardia and 

at Reagan National. I believe USAir, in connection with that agreement, had to give up 16 slots at Reagan, capping USAir’s market 

concentration at 55 percent. So that leads to the question in my 

mind: How many slots is the merged entity prepared to divest? And 

would you support having another FAA blind auction for those 

slots? 

Mr. PARKER. We do not believe it would be good for consumers 

for us to divest any slots. Again, if US Airways or the new American were asked to divest slots, we would, by definition, divest 

those that are the least lucrative to the airline. Those would tend 

to be service to smaller communities, to mid-sized communities— 

that we enjoy serving, that we want to continue to serve, but we 
17 

would be precluded from serving it. Those slots would go to another 

carrier that—the slots that you mentioned, by the way, that were 

auctioned off, Jet Blue acquired those. They now serve with those 

Tampa, Florida, Orlando, San Juan—very large communities. That 

is where additional slots divested from us would likely go to, very 

large communities, and small communities would be disserviced. 

Senator LEE. With flights to airports that are already getting a 

lot of service, in other words? 

Mr. PARKER. Pardon me? 

Senator LEE. With flights to airports that are already getting a 

lot of—— 

Mr. PARKER. Already intensely competitive, already have a lot of 

service, yes, sir. 

Senator LEE. Mr. Horton, do you have anything to add to that 

point? 

Mr. HORTON. I think the trading of slots is representative of a 

dynamic, competitive marketplace. And, in fact, American leases 

some DC slots to Jet Blue, and Jet Blue leases some slots at JFK 

to American. So I think it is reflective of a dynamic and competitive marketplace. 

Senator LEE. The 2010 Horizontal Merger Guidelines state: ‘‘A 

primary benefit of mergers to the economy is their potential to generate significant efficiencies and, thus, enhance the merged firm’s 

ability and incentive to compete, which may result in lower prices, 

improved quality, enhanced service, or new products.’’ 

At the same time, the guidelines also make clear that antitrust 

officials should credit merger-specific efficiencies, that is to say, 

those efficiencies likely to be accomplished, with the proposed 

merger and unlikely to be accomplished in the absence of either the 

proposed merger or another means of having comparable anticompetitive effects, only in those circumstances. 

So what merger-specific efficiencies would you anticipate from 

this transaction? 

Mr. HORTON. Well, Senator, as I described earlier, American Airlines has embarked on a very successful restructuring here to reduce our costs, reduce our debt, and indeed, create a vibrant and 

competitive airline. 

Our restructuring has been unique in that it has really all been 

about renewal and growth built on our new order for aircraft or 

500 airplanes on order. So it has really been about building and 

growing creating a new global competitor. 

We view the merger with US Airways very much as an extension 

of that, and so as a consequence, we see a much more efficient airline going forward. And there will be efficiencies to be had in the 

combination of the two airlines as we think about putting together 

the headquarters staff, the IT systems, and those sorts of things. 

Senator LEE. The guidelines also make clear that the efficiencies 

that have resulted that have been proven from past mergers are 

those that are most likely to be credited. Can you point to any efficiencies that have been obtained as a result of past mergers, for example, from the American/TWA merger of 2001 that can support 

your argument there? 
18 

Mr. HORTON. Sure. Really the most obvious and clearest is that 

you do not need two headquarters functions, so you can largely 

eliminate that redundant staffing. 

Senator LEE. Anything to add to that, Mr. Parker? 

Mr. PARKER. Yes, well, I think we have efficiencies both for consumers in the ability to connect to more markets much more efficiently—as I noted, you know, markets such as Rochester to Hilton 

Head, markets such as Dubuque to Yuma—that customers cannot 

get to on either American or US Airways today that they would 

now be able to connect efficiently on. Those are real efficiencies 

that drive the majority of the synergies. 

On the cost side, as Tom noted, we receive other efficiencies, 

things like management reductions, IT systems that we are able to 

consolidate; you know, two systems become one; facilities in certain 

airports where, you know, we happen to be in different parts of the 

airport, we consolidate. Those are the largest cost efficiencies. But 

it is primarily revenue driven by getting more customers onto the 

combined airlines than either of us can generate independently by 

being more efficient. 

Senator LEE. Thank you. 

Mr. PARKER. Thank you. 

Chairman KLOBUCHAR. Thank you. I just have one followup 

question to Senator Lee’s good round of questions about the slots 

at Reagan. 

Mr. PARKER. Yes. 

Chairman KLOBUCHAR. And he has rightly pointed out, the combined airline would have up to 67 percent or 70 percent of the slots. 

He asked you some questions about divesting, and you rightly 

pointed out that sometimes these slots go to airlines that then fly 

to major metropolitan areas as opposed to serving some of the hubs 

that I voiced my concern about. 

Well, what if all this happened, what if the DOJ required the 

purchaser of the divested slots to serve unspecified small or medium-sized markets? Wouldn’t that be a way of getting around it? 

Mr. PARKER. Well, they would probably have to be subsidized, because the fact of the matter is we at US Airways could not serve 

those markets if we did not have a hub to connect passengers over. 

There is not enough demand in those small communities for point 

to point traffic alone. We would not be able to serve the smallercommunity markets without the connections that we have across 

the DC hub. So without those connections, I cannot imagine how 

an airline would be profitable serving those routes. 

Chairman KLOBUCHAR. How about if it was medium-sized markets? It might be a little different? 

[Laughter.] 

Mr. PARKER. Okay, look. We would have to look at it market—— 

Chairman KLOBUCHAR. No, seriously—— 

Mr. PARKER. We would have to look at it market by market, Senator—— 

Chairman KLOBUCHAR [continuing]. Small towns, but not every 

flight going to L.A. 

Mr. PARKER. Again, we are happy to discuss this and work 

through it. I just will tell you my concern, is that any airline that 

is promising they will fly to those routes will not be able to be prof-
19 

itable and will not be there long because they do not have the connections that we have at US Airways that makes it profitable. So, 

therefore, any mandate that someone serve those routes I would 

suggest would be very difficult for them to honor over time because 

they would not have the connections that the new American will 

have over DC. 

Chairman KLOBUCHAR. Okay. Dr. Moss, do you want to respond 

to that? 

Ms. MOSS. Yes, I think a couple of points are worth making. 

First of all, any slot divestitures that would be sought by DOJ, 

potentially sought by DOJ as a remedy for competitive concerns 

and issues, if they are small and non-lucrative-related divestitures 

or relate to small and non-lucrative markets, then they are not, according to the Horizontal Merger Guidelines, as Senator Lee points 

out or has referenced, those are not particularly good candidates 

for divestiture. 

The whole purpose of divestiture in a merger is to identify assets 

that are viable assets, that are viable, robust assets that, if they 

were spun off to a different party in the market, whether it is an 

incumbent or a new entrant, would be able to maintain robust competition in the market. Divesting assets that feed small communities I think is—those are not particularly viable assets, as we 

have just heard, and thus do not make particularly good 

divestitures to cure competitive problems at these hubs where we 

see increased levels of dominance. 

Chairman KLOBUCHAR. Okay. Thank you. 

Mr. McGee. 

Mr. MCGEE. Yes, thank you. I think there is another point to be 

made when we are discussing slots, particularly at slot-constrained 

airports like Washington National, LaGuardia, O’Hare, Kennedy, 

and that is, how are the network carriers using those slots? A Department of Transportation Inspector General report a few months 

ago pointed out that 61 percent of all domestic departures for the 

four largest network airlines in the United States—that is American, United, Delta, and US Airways—61 percent are now 

outsourced to regional carriers. So that is a staggering statistic 

when you put that in perspective, that six out of every ten departures are regionals operating on behalf of the four largest, not 

mainline service. 

So, you know, the Regional Airline Association boasts that most 

of the departures between Washington and New York every morning—obviously no one could call those underdeveloped markets or 

rural markets—are operated, in fact, by regionals. And so the question is: Are we using these slots, you know, to their full maximum? 

And, you know, obviously the increased reliance on regional carriers raises all kinds of issues, not just about service and safety but 

about the best use of public resources and, of course, environmental 

effects as well. 

Chairman KLOBUCHAR. Okay. Thank you. 

Senator GRASSLEY. Yes, I am going to use part of my 7 minutes 

to make a little statement before I ask questions. 

Currently, there are two airlines serving five airports in Iowa. 

There will be some benefits to the proposed US Airways/American 

Airlines merger. However, the merger needs to be evaluated to de-
20 

termine that the transaction will not consolidate airlines so as to 

inhibit fair competition. 

A question, rhetorical: What is the effect on air travelers in small 

cities and rural communities both in terms of costs and services? 

That is a big issue for me. 

Iowans ask me about the availability of flights, about more options in terms of air carriers that serve Iowa and about reasonable 

and competitive airfares. Specifically, I am concerned that this 

merger could potentially lead to key route eliminations to Iowa, 

and there are some of these key routes that I am really interested 

in. 

Competitive air service is directly related to the economic prosperity of our smaller and rural communities. Now that we have a 

weakened economy, even the threat of route elimination and cutbacks in services or higher airfares can be harmful to these communities and their economic development. 

The U.S. trustee in American Airlines’ bankruptcy has objected 

to the terms of management compensation. I have had concerns 

with multi-million-dollar payouts to executives in previous bankruptcies while they were going through that process. The trustee 

should see that these types of payments are being scrutinized so 

that they meet the Bankruptcy Code’s standard. 

Now to my questions, and it is all about travel and competition. 

Tell me about the impact—and these will be to both Mr. Horton 

and to Mr. Parker. Tell me about the impact of the proposed merger on services to my State of Iowa. How will the merger impact 

specific routes? And are you envisioning any reduction or elimination of flights to any of the Iowa cities currently serviced by your 

airways? We will start with you, Mr. Parker. 

Mr. PARKER. Thank you, Senator. No, we are not—again, because 

these two networks are so complementary, as we put these two airlines together our intent is to keep all the airplanes, keep all the 

people, retain service to all the markets we serve today independently, and just do—and because of that, that is where the value is 

created, actually, is by putting the two networks together that exist 

today and being able to connect more people to more places. 

Senator GRASSLEY. Mr. Horton, have you got anything to add? 

Mr. HORTON. I would just add, Senator, that we have been proud 

to serve Iowa for decades, as I think you know, and we would plan 

to serve Iowa for many decades to come. 

I do think it is important to point out for small communities having American and US Airways come together as the new American 

is actually helpful. And the reason I say that is, you know, American Airlines today has some 240 destinations around the world. 

Combined, the new American will have some 340 destinations. 

Those are just more points that we can serve out of small communities, and that just creates more traffic flow and, therefore, makes 

those markets more durable in the long run. 

Senator GRASSLEY. Okay. What are the opportunities, if you have 

gone this far in your thinking about the merger, under the combined airline for any increased services to Iowa communities? 

Mr. PARKER. Well, as Tom stated, again as we put the two networks together, it provides opportunities because we now have 

more hubs for more service to differing cities. Nothing as of yet 
21 

that we have planned, Senator, but as you optimize networks, it 

certainly creates more opportunities than American had independently because you now have the US Airways network to combine 

with, there is already service to that city. So it certainly provides 

more opportunities for growth. 

Senator GRASSLEY. Okay. Mr. Horton, I will ask you the next 

question because, obviously, if you folks are talking mergers, you 

probably have got the same idea about what it will have on the 

questions I am asking. So what is the impact on airfares for Iowa 

travelers? And that question could be asked for a lot of rural communities not only in my State but a lot of other States? 

Mr. HORTON. Well, Senator, I think that is an important question. It is the right question. In our view, this is creating enhanced 

competition in the U.S. because today you have two really big global airlines—United and Delta—and this creates a third as a competitive counterbalance to that. And, of course, we have Southwest 

who today is a very large carrier in the U.S. So there is a lot of 

competition, but we think this creates competition on a global scale 

that did not exist before. 

With respect to airfares, as I mentioned earlier, I do think it is 

important to look at the record, and the record over the past decade or so since these mergers have taken place is one where airfares, including fees, have actually grown less rapidly than the rate 

of inflation. At the same time, you know, oil prices have risen dramatically. 

So I think the industry has done a pretty good job of keeping a 

cap on fares. 

Senator GRASSLEY. Beyond the questions I have already asked 

you and the answers you have given, could you tell me, as you 

study your merger, what other specific benefits my Iowa constituents will see on the proposed merger if it goes through? 

Mr. HORTON. I will give you one simple example, which I think 

everybody here can appreciate. Most of us are probably members 

of frequent flier programs. The new American/US Airways combined frequent flier program will have 100 million members, so 

that is 100 million people who are now going to have more utility, 

more ability to earn and burn those frequent flier miles across a 

much broader network, 300 destinations worldwide, 6,700 flights a 

day. So that is an improvement for 100 million people. 

Senator GRASSLEY. Do you have anything to add? 

Mr. PARKER. Yes, just connecting markets, Senator. You know, as 

you have noted, American today serves a number of cities that are 

not served by US Airways: Dubuque, Sioux City, Cedar Rapids, 

Waterloo, all served by American, not served by US Airways. However, American does not serve Yuma or Flagstaff, which US Airways does. So you cannot get from Dubuque or Sioux City to Yuma 

or Flagstaff. You will be able to now. You will be able to get to Burlington, Vermont. Those citizens of Iowa will be able to get to 

places they could not get to before because the US Airways network has markets that American did not have, and US Airways 

now will be able to—will have markets that American did not have. 

Senator GRASSLEY. Thank you, Madam Chairman. 

Chairman KLOBUCHAR. Thank you, Senator Grassley. 

Senator Schumer. 
22 

Senator SCHUMER. Thank you. First, I want to compliment our 

Chair on her first hearing since assuming leadership of this extremely important Committee. It is shaping up to be a good one. 

Second, I want to tell her, no, I am not going to ask about baggage fees. I trust—— 

[Laughter.] 

Senator SCHUMER. I trust my colleagues in the airline industry 

will continue to keep the promises they have made to me and others, and that is good. So I am going to ask much more about New 

York concerns today. 

US Airways and American are both very important airlines to 

the State of New York. Both companies service not only our 

downstate hubs but also the somewhat smaller though equally important regional airports throughout the State. 

I have two priorities with respect to this merger. 

First, it is critically important to me that New Yorkers continue 

to have access to a wide breadth of options for services to and from 

our airports, like Buffalo, Rochester, Syracuse, and Islip; and then 

the smaller—and Albany. And then our smaller airports, like Binghamton, Ithaca, Newburgh, Watertown, Elmira, as well as, of 

course, the metropolitan airports of Islip, Westchester, JFK, and 

LGA. So we have a lot of issues out there. 

Second, it is equally important that service is competitive in 

terms of both the cost and quantity of the flights. In any situation 

where the number of players in a market is reduced due to consolidation, we need to look very carefully at the consequences that consolidation will have on competition, jobs, and service to consumers, 

and this merger is no different. The consolidation should only be 

cleared for take-off if we can be sure it would not mean higher 

fares or poorer service or a reduction in New York jobs. And I am 

sure many of my colleagues feel the same way about the issues in 

their States. 

So I would like to ask you, Mr. Parker, a few questions about 

what New Yorkers can expect from a combined US Airways/American Airlines. I would ask you to keep the answers brief, and I do 

want to say you have always been accessible and open to the concerns that we have had, which I very much appreciate. 

American, when you left New York, it was sad. 

[Laughter.] 

Mr. HORTON. We left New York, Senator. 

Senator SCHUMER. Yes. But you have a large commitment to 

New York, and we very much appreciate that. 

So, first, to Mr. Parker, will you commit to maintaining New 

York jobs of both US Airways and American Airlines? You have a 

huge presence, both airlines, in our State. 

Mr. PARKER. Right. Yes, thank you, Senator, and thanks for the 

recognition of our commitment. We love flying in and out of New 

York. We love working with you, and we will continue to do so. As 

we have said, this merger is about putting together two networks 

that are highly complementary and not reducing service. We have 

commitments to that to our employees through no-furlough contracts—through no-furlough commitments. We are happy to make 

those commitments because we have no intention of reducing service. 
23 

Senator SCHUMER. That is super. Okay. Well, you answered the 

second one. Will you commit to maintaining service at the locations 

across New York State which are currently serviced by your two 

airlines? 

Mr. PARKER. Yes, sir. 

Senator SCHUMER. Great. Will you commit to maintaining JFK 

as a hub for American? 

Mr. PARKER. Yes, sir. 

Senator SCHUMER. Great. Okay. So that is great, and you have 

told me—both of you have told me those answers face to face. I am 

glad to get them on the record and very much appreciate it. Companies are good when they are efficient. We just want to make sure 

there is enough competition still out there and that there is enough 

service. 

The second question relates to National Airport, because the 

other aspect of the merger that has garnered a lot of attention is 

National Airport here in DC. Currently, US Airways provides service between DCA and several regional New York airports: Buffalo, 

Rochester, Syracuse, and Islip. As I understand it, a combined US 

Airways/American would control more than 60 percent of the slots 

at National. And I have heard serious concerns expressed by one 

of your competitors, a New York company, Jet Blue, about the market dominance of a combined USAir/American, so I would like to 

enter a letter they sent to me on the topic with some specific New 

York information into the record, Madam Chair. 

Chairman KLOBUCHAR. Without objection, so included. 

[The letter appears as a submission for the record.] 

Senator SCHUMER. And now I have a few questions about DCA 

specifically. 

Last year, when US Airways and Delta executed a slot swap 

agreement for slots at LaGuardia and National, the FAA required 

US Airways to give up 16 slots at Washington National, which captured a market, I think, at 55 percent. Given that a combined US 

Airways and American would control significantly more, it would 

seem that you would need to divest slots in order to ensure competition. And I understand the Ranking Member and the Chair 

asked about slots, but I would just like to hear it again. What is 

your position on slot divestiture? How many slots does US Airways 

propose to divest? And would you support an FAA blind auction? 

Mr. PARKER. Yes, Senator, we would not propose divesting any. 

We believe that would not be good for competition. But we understand it is of interest, that DCA is of interest, and we will continue 

to work with this Committee and with the Department of Justice 

to make our case and listen to other views. 

Senator SCHUMER. Okay. Well, one of my concerns is—and I 

think you mentioned it—that you might give up the slots to serve 

the regional airports, an airport like Islip where you have pretty 

good service right now. You did not mention Islip, but regional airports. 

Mr. PARKER. I did not. 

Senator SCHUMER. So I want to make sure that your obligation 

to allow competition of DCA and your obligation to serve regional 

markets, you do not feel they are mutually exclusive. 
24 

Mr. PARKER. Well, we absolutely do need slots to fly in and out 

of DC, and absent slots, it will certainly result in a reduction in 

service somewhere, Senator. But, again, we are happy to work 

through this and talk to others. We were happy to work with you 

to start the Islip successful. We are happy to have that service. We 

do well in those markets. We would like to continue flying all the 

places we fly out of DC. We obviously would not be able to do that 

if we did not have all the slots we have today. 

Senator SCHUMER. Great. Okay. One final question. Much of the 

service USAir operates is utilizing small regional aircraft, but not 

only for what we agree is important service to small communities, 

where small aircraft are necessary; these large aircraft slots are 

often being used to fly smaller aircraft to larger airports. So if you 

could elaborate on this. What is the breakdown—and you can submit this in writing if you do not have it at your fingertips—of small 

aircraft versus large jets running service from DCA to larger airports? And what can you say to assure us that with a combined airline you will not use small aircraft in large aircraft slots in a way 

that would further reduce capacity and competition by reducing the 

number of available seats, driving up prices paid by consumers? 

Mr. PARKER. Okay. We will submit that in writing. I will just 

note in addition to Mr. McGee’s comments that the smaller aircraft 

allow us to serve smaller communities. 

Senator SCHUMER. Yes. That is good. 

Mr. PARKER. And any effort to reduce the number of small aircraft flying around is going to be inconsistent with the Committee’s 

desire to seek service to small communities. But we will submit to 

you in writing—— 

Senator SCHUMER. You just do not want to see the small planes 

go into the large cities and neglecting the smaller cities. 

Mr. PARKER. Understood. 

Senator SCHUMER. That is all. Does that make sense to you? 

Mr. PARKER. Yes, sir. We will submit it to you in writing. Yes, 

sir. 

Senator SCHUMER. Thank you, Mr. Parker and Mr. Horton, and 

I thank the other witnesses for their being here and their testimony as well. 

Mr. PARKER. Thank you, Senator. 

Mr. HORTON. Thank you, Senator. 

Chairman KLOBUCHAR. Thank you, Senator Schumer. 

Senator Flake. 

Senator FLAKE. Thank you. I want to just say what a pleasure 

it has been to have US Airways headquartered—first America West 

and now US Airways in Phoenix, in Arizona. We have benefited 

tremendously from it. You have been great corporate citizens. 

Great to see you here, Mr. Parker, and Mr. Johnson behind you, 

and other pilots that I have flown a lot with, and flight attendants 

and others. 

All of us have experienced in elementary school when your best 

friend moves away, this time to Dallas, and with all these promises 

that they will write or that they will visit and everything else—— 

Mr. PARKER. I am going to write you, Senator. 

[Laughter.] 
25 

Senator FLAKE. But, you know, the thing I was never able to do 

at that time was put our friends under oath. 

[Laughter.] 

Senator FLAKE. And we have managed to do that here. 

Mr. PARKER. Noted. 

Senator FLAKE. But I know that promises are promises, and you 

have to—you know, the reason mergers happen, there are economies of scale that have to be taken into account. But certainly in 

Arizona we are concerned, obviously, about the level of commitment that has been there and that it will be maintained. Particularly, it is a little concerning when you have as major hubs Dallas, 

Los Angeles, and Phoenix. How will you manage that? It seems 

that the proximity of those hubs is close enough that it is going to 

be difficult to maintain the same level of service. 

Mr. PARKER. Okay. Well, thank you, Senator, and thank you for 

the remarks. I love Arizona like you do, and what I am happy to 

report to you is this merger is good for Arizona, much like when 

we merged America West and US Airways, and the people of Arizona at the time were a little worried about what it was going to 

mean to America West Airlines and the service they had there. It 

just made it better. Because of the merger of America West and US 

Airways, we gave the people of Arizona more opportunities to fly 

more places. This merger is going to do that yet again. 

The Phoenix hub is a critical piece of US Airways’ profitability. 

It will be a critical piece of American Airlines’ profitability. We will 

just be able to provide more service to the people of Arizona, and 

I feel really very, very good about that. 

The headquarters issue is one that is always difficult in situations like this, not one that we took lightly, of course, but one that 

we had—you know, we did what we needed to do to make sure that 

this was—you know, we have to pick one. And the reality is American Airlines has been headquartered in Dallas-Fort Worth for 

quite some time, and we thought that was the right place to keep 

the American Airlines headquartered. But, again, not done lightly. 

We expect to retain a large corporate presence in Tempe as well. 

We have just renewed our lease on our headquarters, and we expect to maintain that facility and have it fully staffed with management personnel, because we are committed to Arizona. We are committed to the community. We will still be a huge partner in the 

community. I assure you I will still be coming to visit you and your 

colleagues because we love Arizona and it is important to us. 

But it is also the right business decision. The Phoenix hub is extremely important. Dallas, by the way, as you know, is 900 miles 

away. And the L.A. situation is just a very different type of flying. 

American uses Los Angeles largely as a gateway to Asia. It is about 

half the size of the connecting hub, the connecting facility that we 

have in Phoenix. So they are completely complementary, and we do 

not see any reason that anyone in Arizona should be concerned 

about the merger. Indeed, I think it is very good for Arizona. 

Senator FLAKE. In Phoenix, the taxpayers of Phoenix have spent 

considerable money upgrading facilities at Sky Harbor with the 

Sky Train and other things, and I know there is concern with this 

merger, that that will continue. You have talked some about it, but 
26 

can you talk about any growth opportunities that exist out of the 

Phoenix hub with this merger? 

Mr. PARKER. Well, again, what I can tell you right now is the 

plan is to put the two airlines together as they currently exist, and 

we are—you know, growth is obviously something in the future 

that is harder to predict. What I can tell you is whatever growth 

opportunities exist today in Phoenix, they are greater with this 

merger because there are so many more markets that American 

serves that we do not. There are international possibilities that I 

know are very important to the State that we have not been able 

to accomplish at US Airways on a stand-alone basis that become 

more viable now with the combination with American. Again, no 

promises on that, but they are much more viable than they were 

with US Airways stand-alone. 

So I think there is a lot—the potential for growth is much greater. I am certain of that. 

Mr. HORTON. Senator, I would just add to that, you know, American is a founding member of the oneworld Alliance. I am the chairman of oneworld. And one of the things we have found over the 

years is that we tend to flow oneworld international connections 

into our big hubs in North America. So I think down the road those 

are the sort of opportunities we would want to have a look at as 

to whether, you know, companies like BA and Japan Air Lines and 

others would have opportunities to put flights into US Airways’ 

hubs that are now part of the new American. 

Senator FLAKE. There has been a lot of talk about the DCA slots 

here. How will that relate with this merger in terms of slots—or 

flights between Phoenix and DCA? 

Mr. PARKER. I do not believe it will have any impact. Those, as 

you are well aware, Senator—— 

Senator FLAKE. That was self-interested question. 

[Laughter.] 

Mr. PARKER. I have seen you on the flight several times. But you 

have also helped the people of Arizona get those flights, which we 

appreciate. Those are exemptions, beyond-the-perimeter rule, and, 

again, I do not believe—although I guess it is up to the Justice Department to decide—that those are at risk. 

Senator FLAKE. Right. Well, thank you. I am out of time. 

Thank you, Madam Chair. 

Chairman KLOBUCHAR. Thank you very much, Senator. 

Senator Blumenthal of Connecticut. 

Senator BLUMENTHAL. Thank you, Madam Chairman, and my 

congratulations and thanks to you for your first Subcommittee 

hearing, and thank you to all of the witnesses for being here today 

and for your cooperation, both Mr. Horton and Mr. Parker, in providing information leading to this hearing. 

I think the concern here really is with the impact on consumers 

and passengers, not only from our States but others around the 

United States, and obviously the picture is bigger than just the industry insofar as it is here today. It really is a global issue where 

we confront competition in the United States against airlines that 

are, in effect, creatures of their governments. They are subsidized 

by their governments. They compete unfairly. And I use that term 

advisedly, not in a legal sense, but in the sense of their ability to 
27 

use the vast resources of their governments to, in effect, buy new 

airplanes and set prices that are unfair to our airlines, which I 

think is one of the reasons why we have seen consolidation and increasing concentration in the industry and the creep of consolidation that threatens consumers in our country. 

So I very much understand the economics of this merger and the 

reasons that it makes sense on paper, on the ground, and in the 

air. At the same time, I think that the Department of Justice has 

to be vigilant about the industry not only for the sake of your passengers but also other airlines where the threat of consolidation 

may be on the horizon. 

So let me begin my questions in terms of the outlook and interests of our passengers by asking about Connecticut’s passengers 

and consumers. I would like a commitment, Mr. Parker, that service will be maintained at its current levels or increased at both 

Bradley and Tweed airports. 

Mr. PARKER. Yes, sir. Again, that is our intention. That is what 

we would commit to do at the time of the merger. I do want to be 

cognizant in all these cases that, you know, part of the reason 

there is skepticism about the airline’s ability to do this is that others that came before us and made commitments, that people feel 

like they were not—feel as though they were not kept. What I can 

tell you is what I have continued to say here, which is the value 

of this merger is putting these two airlines together, flying everywhere we fly today. So I am happy to commit that once we put the 

airlines together, we will continue to fly the places we continue to 

fly today, in Connecticut as well, with just one caveat: that conditions change, of course, and there may be something that allows 

us—that requires us because of market conditions to change. But 

that is always the case. That is certainly the case in the standalone. There is nothing in this merger in any of the markets we 

serve that would lead us to discontinue service, and that is certainly the case in Connecticut. 

Senator BLUMENTHAL. What you are saying, in effect, is if passengers or consumers decide they do not want to go to Washington 

from Bradley anymore, you will not continue to fly airplanes—— 

Mr. PARKER. Precisely—or if the cost of fuel gets so high it is too 

expensive to carry passengers that far, absolutely. But precisely 

what I—— 

Senator BLUMENTHAL. But your present expectation and your 

commitment is to continue to fly at the present levels of service to 

both Tweed and Bradley? 

Mr. PARKER. Yes, sir. 

Senator BLUMENTHAL. And one of the proposals I have seen—and 

probably you have considered—is to increase the service, as a matter of fact, into Tweed insofar as a flight to Washington, DC, may 

be plausible or feasible. Could you comment on that possible route? 

Mr. PARKER. I do not have that date in front of me, Senator, to 

know exactly. I would like to get back to—I will get back to you 

on that and see what indeed might make sense there. 

What I know is the airline does well flying to Tweed, and we are 

happy with the service we have there today. I am not certain about 

growth opportunities, but we will get back to you. 
28 

Senator BLUMENTHAL. What I would suggest is that the increasing economic activity in the New Haven area, particularly involving 

bioscience and biotech, may justify that kind of flight from Washington to Tweed, and I would appreciate your getting back to me 

about it. 

Mr. PARKER. Yes, sir, we will. We would like to fly anywhere that 

we can do so profitably and enjoy the service we already have to 

Tweed. Thank you. 

Senator BLUMENTHAL. Maybe then I can ask both of you whether 

you see yourselves as competitors on any particular routes. In 

other words, generally you have said you are not flying the same 

routes; therefore, you are not competing with each other. Are there 

any routes where you are presently competitors? 

Mr. HORTON. Well, as Doug maybe mentioned earlier, it is a 

unique merger in that it is very complementary and there is very 

little overlap in the network. So today the combined company operates some 900 routes, and on only 12 of them do we directly overlap. So that is, I think, unique distinct from prior mergers in the 

industry. 

Senator BLUMENTHAL. Where among those 12 routes do you see 

yourselves as really going head to head? 

Mr. HORTON. Well, we are competitive on all of them, but, you 

know, airlines are a network business, as you know, so even where 

we do not have a direct overlap, of course, we are competing via 

connections over hubs. And that is why the industry is so dynamic 

and so competitive, and that is why fares have been, you know, so 

restrained over the years. There is just so much competitive activity in the industry. 

Senator BLUMENTHAL. Do you agree, Mr. Parker? 

Mr. PARKER. Yes, sir. We absolutely are competitors today. We 

compete vigorously against each other. But we have two route networks that are not—that independent are not as capable of competing against the larger carriers as we will be together. So I think 

by putting this together, we create a stronger competitor to the rest 

of the industry. 

Senator BLUMENTHAL. In the past, Mr. Parker, I believe USAir 

has resisted raising fares when other airlines have done so, and I 

guess one of the concerns that we may have is that the merger 

might lessen the downward pricing pressure that that past conduct 

has created. Do you foresee a change in that pricing behavior or 

conduct? 

Mr. PARKER. I do not see anything in the merger that would 

change pricing behavior at all. Indeed, all it will do is allow the put 

the prices on more markets across the United States. 

Senator BLUMENTHAL. And, Ms. Moss, maybe I could ask you 

your perspective on fair prices as a result of consolidation. Do you 

see an impact on the prices of these two airlines generally, and in 

particular, on any particular routes? 

Ms. MOSS. Thank you. I think that these two airlines are, in fact, 

head-to-head competitors. They are each other’s closest competitors 

on a number of routes. In our white paper, we have a table that 

presents the results of the overlap analysis. So, yes, there are definitely routes that will be—where competition will be significantly 

eliminated, several mergers to near monopolies, several mergers to 
29 

monopoly, and antitrust analysis, you know, is very good at sort of 

predicting what the effects of eliminating head-to-head American 

are. That is sort of a direct effect. And so the statistics show that. 

I think the important point also is that, based on the Delta/ 

Northwest analysis and United/Continental where we saw elimination of competition, substantial elimination of competition on 

some very important routes in the United States, we did see some 

fare increases, and some pretty significant ones. We also saw very 

few fare decreases, but in addition, we saw the carriers driving 

traffic to large hubs. And it is a very similar fact pattern, here and 

in comparison to the last two mergers. And I think that we really, 

for the good of aviation policy, competition policy, public policy, and 

American consumers, we have to inform what goes on in this case 

from what has happened in the past. And certainly at a route-specific level, that is what we see. And at a national systems level, you 

know, with very few large systems, you certainly increase the probability that the airlines will simply follow each other on capacity 

decisions, keeping capacity tight to maintain fares, and as part of 

sort of a tacit agreement, and there is a lot of that already. There 

are quotes all over the press from other airlines indicating that 

they want capacity discipline to maintain fares. So there is quite 

a bit of evidence out there already and empirical economic analysis 

that shows this. 

I think, finally—I do not want to run over my time, but, finally, 

I think the broader perspective here is really, really important. The 

airlines want to compete in the global system, and I understand 

that. That is where the business is going, and that is where the 

dollars are. We are really stuck, though, we a very fundamental 

tension over expanding globally without sacrificing domestic consumers. And that is what is happening here. We are expanding 

globally to compete in the global arena, fair enough, but we have 

to find a way not to sacrifice U.S. consumers on the altar of global 

competition. And this all sort of comes out of the driving traffic to 

big hubs, cutting service to small communities. You know, not everybody travels internationally. I was just in Vermillion, South Dakota, where a bunch of little farmers came to a conference, some 

of whom had never been on an airplane before. Those are the kinds 

of consumers I think that we have to—— 

Senator BLUMENTHAL. Farmers are not so little. 

[Laughter.] 

Ms. MOSS. I think we have to—— 

Chairman KLOBUCHAR. Speak for your own farmers, Senator. 

[Laughter.] 

Chairman KLOBUCHAR. Sorry, but continue, Dr. Moss. I could not 

resist. He was making fun of farmers. 

Senator BLUMENTHAL. I meant in importance, not in size. 

Chairman KLOBUCHAR. All right. Okay. 

Dr. Moss. 

Ms. MOSS. So I think global competition does not equal domestic 

competition, and we have to make sure that we maintain competition in the U.S. and for U.S. consumers. And essentially what I 

hear here are concessions and promises to maintain service in New 

York and in Connecticut and in Arizona. Basically what you are 

getting here are up-front commitments to condition the merger. 
30 

And if that is what is going to happen, then we have to ask ourselves, well, then—that is sort of a regulatory approach to approving the merger. Why not just have good antitrust policy in place 

that looks hard at the merger and determines whether it is going 

to eliminate competition and harm consumers? 

Senator BLUMENTHAL. Well, my time has expired, but I really appreciate that very thoughtful answer and very much appreciate the 

testimony of Mr. Parker and Mr. Horton. Thank you very much, 

Mr. McGee, as well. 

Thank you. 

Chairman KLOBUCHAR. Thank you. 

Senator Cruz is a Member of the Judiciary Committee, but visiting our Subcommittee since his State has been mentioned a few 

times here. Senator Cruz. 

Senator CRUZ. Well, thank you Madam Chairman, and thank you 

to each of the witnesses for being here. And if I may express my 

apologies to my friend from Arizona, and at the same time express 

to Mr. Parker that I am looking forward very much to welcoming 

you and your colleagues to be new Texans. 

Mr. PARKER. Thank you very much. 

Senator CRUZ. And I think you will find the State quite welcoming and an environment that celebrates your coming to our 

State and joining us. 

My focus for a long time has been and I think the focus of all 

of us should be on economic growth and on ensuring that the economic growth in our country returns to historic levels and remains 

strong going forward. And so the question that I would like to pose 

to both Mr. Horton and Mr. Parker focuses on the impact of this 

merger on growth, both from the perspective of the great many employees that both companies currently have, and then, second, from 

the perspective of consumers. And so I would like to start, Mr. Horton, by asking—obviously, American, headquartered in Texas, has 

a great many jobs in Texas, which we are grateful for, but American has had challenging financial circumstances in recent years. 

And I would like to get your views both on the negative impacts 

that would flow to American if this merger were not approved. I 

think it is widely expected to be approved, but I would like your 

views on the negative repercussions if it were not, and on the flip 

side, on the positive benefits to the many thousands of men and 

women who work at American right now if this merger is approved. 

Mr. HORTON. Thank you, Senator, and I would also like to welcome my good friend Doug Parker to the great State of Texas. I can 

affirm that he does own cowboy boots. I have seen him wear them. 

Senator CRUZ. That is the best news I have heard today. 

[Laughter.] 

Mr. HORTON. I do think the merger is good for American Airlines 

in every way. American has embarked on a very difficult restructuring here, but it has been a very successful restructuring, and 

what has set it apart from other restructurings, in addition to the 

creditors getting full recovery, is that it has been about renewal 

and growth—it was built upon the largest aircraft order in the history of the industry—and about reinvesting in our products and 

services, and our customers have certainly taken note of that. So 

it has been about growth. And I think what is great about the 
31 

USAir combination is it is really about extending that strategy and 

extending to—and creating a new global leader in the aviation industry and one that will be headquartered in Dallas-Fort Worth. So 

we are very excited about that. 

I do think the new American will be strong and vibrant, and I 

said that independent of a merger, I think we would have been 

strong and vibrant, but I think we will be that much stronger and 

that much more forceful of a global competitor combined with US 

Airways. So I think it is nothing but good for American, and I 

think it is good for the State of Texas. I think it is good for the 

Dallas-Fort Worth area. 

Senator CRUZ. A followup question that I would ask of both of 

you. In my view, the surest protection of consumers is vigorous 

competition, and the question I would ask both Mr. Parker and Mr. 

Horton is: Post-merger, in your judgment, what would make the 

new American a more effective competitor and able to compete 

more vigorously with other airlines in terms of prices, in terms of 

service, in terms of ultimately providing consumers with a better 

product? 

Mr. HORTON. Well, I will start. I think, you know, aviation is a 

very important industry. It is a vital industry for the U.S., and it 

is an industry where we have not in the U.S. been—I think it is 

fair to say we have not been a global leader because of the turmoil 

over the last decade. And, you know, the U.S. invented aviation, so 

I think we should have the very best airlines in the world. 

So that is what this is really about, is creating an airline that 

is not only the largest but can be the best in the world, and will 

have the financial capacity and the financial wherewithal to invest. 

And that is what we are going to go do. 

Mr. PARKER. Thanks, and if I can, I will start actually with a 

comment on your first question to Tom, which was on the economic 

growth. I happen to believe this is one of the great economic 

growth stories in business today. We are taking two companies and 

putting them together and creating so much economic value that 

it is shared virtually everywhere. You know, as Tom mentioned in 

his opening comments, the creditors of American Airlines, American Airlines is going to come out of bankruptcy, and people are 

going to be paid in full. That is absolutely unheard of in airline 

bankruptcies. It is happening because of this merger, that those 

creditors are going to get paid back 100 cents on the dollar. 

The employees of American and US Airways are going to work 

for a stronger, more vibrant company that can pay them more and 

provide them, you know, better benefits and more security, which 

is why they are so supportive. 

And then to segue to your second question, as to consumers, we 

are creating a competitor to two other airlines, which is where the 

value comes from, is by attracting more consumers to our airline 

combined than we could independently. And because of that, that 

value is then what is shared with the creditors of American, the 

shareholders of US Airways, the employees of both companies. 

So, again, it is, in terms of economic growth, I think a very good 

success story, and as it relates to consumers, a great story as well. 

Senator CRUZ. Very good. 

Thank you, Madam Chair. 
32 

Mr. PARKER. Thank you, Senator. 

Mr. HORTON. Thank you, Senator. 

Chairman KLOBUCHAR. Thank you very much, Senator Cruz. 

I have a few more questions. I promised to go back to you, Dr. 

Moss, and Mr. McGee on this ticket price issue. And, of course, as 

we all know, it is not just ticket prices; it is also the fees. There 

seems to be some disagreement. This is not just about USAir and 

American about where we are with ticket prices, and I do not want 

to put words in your mouth, Dr. Moss, but I think you argued that, 

depending on the route, depending on the city, that some prices 

have increased significantly depending on how much competition 

there is. And then also, I would like you to respond to Mr. Horton’s 

point about the fact that fuel costs have gone up even more than 

the ticket prices have gone up in these areas and how we get a 

grasp on where we really are for the cost to the American consumer during this time of great consolidation. Dr. Moss. 

Ms. MOSS. Yes, fare prices are probably one of the most controversial topics you can find when it comes to pricing. 

Certainly fuel costs are a huge part of what an airline incurs to 

do business, and fuel price volatility is a big factor. But airlines 

have become very good at hedging that risk and managing their 

fuel portfolios. 

There are other inputs costs, obviously, that factor into fair 

prices, and we are not talking about ancillary fees. Those are all 

unbundled and separate at this point and very non-transparent as 

far as consumers are concerned. 

The analysis that we have done does account for fuel costs and 

does show that, above and beyond fuel cost increases, there are 

fare increases that are above average at some of these origin and 

destination airports on these large hub-to-hub routes. 

On a lot of these very large routes, there is very, very limited 

competition, in some cases just two carriers. After the merger of 

these guys and of United/Continental and Delta/Southwest, some 

routes were monopolized. There is very little incentive for firms in 

a duopoly, where there are just two firms, or a monopoly—— 

Chairman KLOBUCHAR. Just for the record, you are not just talking about tiny towns; you are talking about major—— 

Ms. MOSS. Oh, no. We are talking about major hub-to-hub routes 

where there is limited, very limited competition. And if you eliminate a competitor in a small market, meaning very few competitors, the chances are you are going to get price increases. And we 

have seen that. Our analysis has shown that. 

So the fact pattern is there, and there are a lot of similarities, 

and I think those similarities really need to be duly noted and investigated by the DOJ when they look into this merger. 

Chairman KLOBUCHAR. Thank you. 

Mr. McGee. 

Mr. MCGEE. Yes, thank you Senator. I think in many ways what 

we really have is two different domestic industries, because you 

have to look at routes on whether or not they are served by lowfare carriers. As 20 years ago the Department of Transportation 

pointed out with a famous report on this—‘‘The Southwest Effect,’’ 

as it was dubbed. In reference to what Senator Blumenthal was 

speaking about earlier, I am a resident of Connecticut as well, and 
33 

Connecticut sort of crystallizes this issue, because on routes where 

there is low-fare competition with Southwest, there is pressure to 

keep fares down. On routes where major network carriers compete 

head to head without low-fare competition across the country, what 

we see is that, in fact, prices have increased, and they continue to 

increase. And this is borne out every quarter by the Department 

of Transportation quarterly airfare reports. 

And so, you know, added to that there is increasing evidence that 

Southwest itself, which is, you know, often pointed out as the lowcost leader, and fairly so, that Southwest’s fares have increased as 

well over time. 

There has been a lot of discussion about, you know, over time 

fares going down, and, you know, there is evidence for that, there 

certainly is. What has not been discussed are the fuel surcharges, 

and, of course, as you point out, the ancillary fees on top of that. 

So we are very much comparing apples and oranges in many cases. 

But you really have to dig down to look route by route almost 

to see where consumers are benefiting, and, again, where there is 

no low-fare competition, consumers do not benefit. 

Chairman KLOBUCHAR. Okay. Any response? 

Mr. PARKER. We welcome the analysis. We understand, as we 

said at the beginning, that the scrutiny of this is important, and 

we welcome it, and we believe that the result of that analysis will 

be a recognition of what we described here, which is that this is 

a merger that is good for competition, that should be approved, and 

that is good for the United States. 

I would also just mention, as it relates to our customers, what 

we are trying to do here is provide more to our customers. We do 

not have the ability to connect people or to get people to as many 

places as some of our larger competitors. By combining we do. We 

cannot be in business if we do not provide good service to our customers, and this will allow us to provide better service to customers 

than either of us can independently. 

Chairman KLOBUCHAR. Okay. I wanted to followup a little bit on 

that as you were talking about the nine routes and that there is 

not significant overlap between the airlines, but one of the things 

that we looked at is how you do compete right now, and that would 

be how US Airways and American compete, and I will just give you 

one example. A lot of the general public who may not get businesses playing for their flights, they look for lower-cost flights by 

going through hubs because they found out that if they maybe 

make a stop somewhere, they get a cheaper rate. And so an example, USAir charged $549 for connecting service between Dallas and 

Washington National, which is far less than the $1,500 for American’s nonstop service, just an average we saw right now. It is nearly $1,000 cheaper. 

So do you believe there still will be these kinds of competitive 

rates when you see this merger where regular people choose to 

take some kind of ridiculous route sometimes or go through a hub 

instead of going direct just to save money? How is that going to affect that part of the competitive market in the merger? 

Mr. HORTON. Well, certainly direct routing is of more value to a 

customer than one where you have to stop at a hub, so it stands 

to reason that it would be priced differently. But I think there 
34 

are—there will be any number of connecting opportunities to compete against any nonstop flight. So you take an example like that, 

and somebody could also connect over Atlanta on Delta or Chicago 

on United. There are just other ways to do it, and there are literally thousands of those competing alternatives in the marketplace, which is why, you know, fares in the industry have not 

grown as fast as inflation. It is just a very, very competitive marketplace. 

Chairman KLOBUCHAR. A response from Dr. Moss or Mr. McGee. 

Ms. MOSS. Yes, I think you have to be careful when you sort out 

nonstop service, which is typically a distinct market, for connecting 

service. There are different ways to get places, but I think to pull 

in something that Bill said earlier, we really cannot underemphasize the critical role of the low-cost carrier here. Low-cost carriers 

in the past have provided a really important source of discipline, 

and that includes, you know, on nonstop routes and also connecting 

routes. I mean, a lot of people will take connecting routes on a lowcost carrier to get from Point A to Point B. Others will fly a legacy 

airline to get from Point A to Point B. It depends on you as a consumer. 

But low-cost carriers in an environment where there is increasing legacy consolidation are really going to have a tough time providing that discipline. You know, they are going to behave less like 

little mavericks, like AirTran and Jet Blue and others in the industry in the past, and they are going to face this critical decision 

about whether to continue to be aggressive and take share from the 

legacies or whether to just follow what the legacies are doing in 

terms of their pricing policies. And that is really the critical juncture I think that we are at, and that is what we risk losing by increasing the solidification of most of the market with the legacies 

and leaving the low-cost carriers with less than 10 percent of the 

national market. I do not think we can rely on them to sort of save 

us all from higher prices. 

Chairman KLOBUCHAR. And I think that the numbers are now 

that the Big Four would each have about 20 percent market share, 

including Southwest in that, and then the next largest would be 

Jet Blue with 5 percent, Alaska with 3.9 percent, and the remaining airlines with less than 2 percent. Is that right? 

Ms. MOSS. I think that—yes, that is—— 

Chairman KLOBUCHAR. And that is one of the reasons that Senator Lee and I are asking for the GAO to do a study of the entire 

industry beyond just this merger in terms of the effect all of this 

consolidation is having on pricing, is having on competition and 

service to consumers, which I hope will be helpful. 

Just two more followups, and then I will turn it over to Senator 

Lee. First of all, the integration if the merger were to occur. I know 

that, Mr. Parker, US Airways had a long transition in merging 

with America West, and there were some glitches. We will not go 

into all of it right now, but if the merger is approved, what are you 

going to do to ensure that these problems do not occur again for 

consumers? 

Mr. PARKER. Well, putting together two airlines we recognize is 

not an easy task, but the good news is both of us have done it once 

before and have learned a lot through that. More importantly, the 
35 

fact that we have agreement with all of our employees, our labor 

unions, on how they will integrate makes this dramatically easier. 

It is one of the more difficult parts of integration, which, thanks 

to hard work on their part and working with us, we already have 

largely resolved. So that will help tremendously. 

But then as it relates—so now you are left really with kind of 

systems integration, which certainly is difficult as well. But like I 

say, we have learned a lot through our experience at America 

West/US Airways, and I will let Tom speak for himself, but I know 

that they at American have done the same. We have a great team 

we are going to put together between the two airlines, and it is our 

primary focus going forward making sure that we integrate in a 

way that is done efficiently and without disruption. 

Chairman KLOBUCHAR. Mr. Horton. 

Mr. HORTON. Well, we have learned a lot not only from our own 

experience but also from what we have seen with Delta/Northwest, 

United/Continental, and Southwest/AirTran. And so we will seek to 

take the best of those practices and put them in place as we pursue 

the integration. 

We already have integration planning underway. Doug and I 

lead up a transition team, and so we are working hard to make 

sure that when the deal is closed later this year, we can hit the 

ground running. And our focus is 100 percent on getting this right 

for our customers. 

Chairman KLOBUCHAR. Thank you. 

To end on a positive note here for everyone, tomorrow we are 

holding a hearing in the Commerce Committee about airline safety, 

and since the last FAA reauthorization, the airlines have been participating with the FAA, as you know, and Secretary LaHood on 

improving safety. I would like to say that I just saw that 2012 was 

the best in safety history, according to the International Air Transport Association. And we always know anything can happen. As I 

was sitting on my USAir flight yesterday in a bad storm to a bad 

storm, everything went well. But we all think of that every time 

we get on a plane. And just to end with how you see these mergers 

as affecting airline safety. 

Mr. PARKER. Well, first, thank you for the comments. We are extremely proud of our people and what they have accomplished over 

time. It is by far the most safe form of travel and will continue to 

be so. This merger, of course, will have all the benefits that I stated, but first and foremost, we will be ensuring safety. We will work 

closely with the FAA to move to one operating certificate. We will 

take our time and make sure we do that well. The FAA will ensure 

we do as well. We work extremely well with the regulator because 

we share a view on how critically important it is for the safety of 

our customers and consumers. So we will work through that. It will 

take something on the order of a year and a half actually before 

we get to one certificate because it is so important and most consumers will not see that. You will see more of one airline flying. 

But it will be two separate airlines until we are all certain and the 

FAA is certain that we have our procedures and policies coordinated well enough that we can move to one FAA operating certificate. 

Chairman KLOBUCHAR. Thank you. 
36 

Mr. Horton. 

Mr. HORTON. Yes, I would just second Doug’s comments. We are 

very proud of our safety record. It is our highest calling in the airline business, and we are very proud of our people who deliver that 

every day. 

Chairman KLOBUCHAR. Okay. Anything more, before I turn it 

over to Senator Lee, on any of my questions I had of the airline 

executives? Dr. Moss, Mr. McGee. 

Ms. MOSS. I just have one quick point on efficiencies, and I think 

it is the system integration stuff that really has been the skeleton 

in the closet for previous mergers. We have seen in United/Continental, in Delta/Northwest, and the America West/USAir merger. 

You know, when DOJ looks at efficiencies, they want to see stuff 

on the table. They want to see merger-specific efficiencies, and they 

want to see that they are cognizable, meaning that they are really 

going to be realized. And a lot of these system integration problems 

kind of pop out of the bushes after the merger has been consummated, and we have now seen enough of this and have enough 

of a track record to be able to say, okay, that is probably something 

we should be expecting to happen. And I think it is important then 

to balance or account for those very probable system integration 

problems at the time the merger is reviewed, because they cut significantly into the efficiencies that are promised by the airlines. 

And if they cut significantly into them and those costs are passed 

on to consumers, then the efficiencies are not as great as they were 

originally forecasted to be. 

So I think this is something new that we are going to have to— 

or, you know, that antitrust analysis should be accounting for. 

Chairman KLOBUCHAR. Thank you very much. 

Mr. McGee. 

Mr. MCGEE. Yes, thank you. One other thing that we wanted to 

point out is we are concerned at Consumers Union not just about 

the micro effects of this specific merger, which we have detailed 

today, but also the macro effects. Even on the pricing issue as we 

talked about, you know, the fact is when you have three network 

carriers as opposed to six or seven or eight, you know, we have 

seen in the past with fare increases, for example, that one or two 

airlines would match a fare increase and others would not, and the 

fare increase would be rescinded. We have seen it with new innovations. 

So the effects of this merger would have been very different 7 or 

8 years ago had we not had all of these other mergers. And so we 

just do not want that to be lost in all of this. 

You know, the argument has been made, well, you did it for the 

others, why not do it for us? But with each successive merger and 

with this rapid consolidation of the industry, the industry continues to change and, in our view, it just raises a lot of disturbing 

questions for consumers. 

Chairman KLOBUCHAR. Thank you very much to all of you. 

Senator Lee. 

Senator LEE. Thank you. 

Dr. Moss, first of all, I would like to commend you on your opening statement being exactly 5 minutes, no more. 

[Laughter.] 
37 

Chairman KLOBUCHAR. He actually turned to me during it and 

said that is amazing. 

Senator LEE. A military-like precision there. 

So in conducting antitrust analysis, our Subcommittee often 

looks to whether and to what extent there may be barriers to entry 

in a particular marketplace, barriers that might prevent a competitor from coming into the marketplace and providing some market 

discipline. 

When the barriers to entry are minimal, then new competitors 

or existing rivals find it, you know, relatively easy to get into the 

market, and they have more of an ability to emerge and to compensate for any concentration of market power. On the other hand, 

where there are significant barriers to entry, that becomes less possible. 

So what do you see as the greatest barriers to entry into the airline industry? 

Ms. MOSS. That is a really good question, and entry can be a 

very powerful thing, just like efficiencies can be. You know, if 

mergers create anticompetitive effects and potential harm, then the 

first thing we look to, obviously, is, well, will entry discipline price 

increases post-merger? And will efficiencies, for example, have 

countervailing effects to the adverse effects of higher prices, reduced service, lack of choice, et cetera, et cetera. 

I think the biggest barrier to entry, as this industry further consolidates, is concentration itself, concentration meaning, you know, 

just a couple of airlines dominating large hubs. It really is a big 

wall to scale for a small potential entrant to get into a market 

where they are going to have to scrabble and scrape to get slots, 

to get gates, to get ticketing space, baggage handling, all this kind 

of stuff—all the pieces of the puzzle that need to be in place for 

an airline to offer service. 

I think as concentration increases at hubs, it becomes less inviting, less easier for smaller carriers to get in. And that is exactly 

what we have seen. We used to have hubs that really were very 

friendly and conducive to multiple airlines serving them. And as 

consolidation has occurred, those hubs have shut down and—not 

shut down in a literal sense, but shut out potential competitors. 

Now, with that said, airlines are in the unique position of having 

very fungible assets where they can move aircraft around and go 

to profit centers, go to markets that are very lucrative and very 

profitable. That is what you want to see. You would ideally like to 

see that in the wake of a merger that creates price increases. The 

question is: Is that harder to do today than it was 6 years ago before six mergers went through? Probably yes. And that we need to, 

I think, look very carefully at. 

And as the fringe of competitors shrinks down with the low-cost 

carriers and the regionals, they are really facing much, much higher barriers to entry, which could potentially help consumers. 

Senator LEE. Okay. So the barriers to entry that you would see 

that might be attributable to this merger, should it go through, are 

you saying that would be felt most acutely in these hubs? 

Ms. MOSS. I think if the hubs become more consolidated—and we 

have shown that to be the case in many major airports—then, yes, 

I think it will be harder. 
38 

Senator LEE. Any other barriers to entry that you can point to 

that would flow naturally from this merger if it were to proceed? 

Ms. MOSS. Well, I think that is the major one. And that is at sort 

of the route-specific level. If you look nationally, I think you are 

also looking at potential barriers to entry, because low-cost carriers 

do not really operate as large national footprint-type systems, and 

it will be difficult for them to expand their operations to try and 

horn in on that market, to try and get a foothold in that market 

to compete on a broader level. 

Senator LEE. I understand that you have testified in the past 

with regard to a number of other mergers in the airline industry, 

and you have recommended against them and, nonetheless, the Department of Justice, under Republican administrations and Democratic administrations, has approved those that you have testified 

against. Is it your opinion that the Department got it wrong in 

those cases? 

Ms. MOSS. I do not want to say that the Department of Justice 

got it wrong. I think the DOJ does very, very good, solid, exhaustive analysis in these airline merger cases. 

I think what has happened is perhaps beyond the ability of antitrust to sort of address on a really comprehensive basis. We have 

had a series of mergers that have sort of put this ball into motion 

to allow the carriers to compete globally, which we discussed just 

a few minutes ago, and that is fine. I mean, again, those are lucrative markets, and they want to compete and expand globally. 

The question is: What does that do for the domestic markets? 

And we do see some very negative tradeoff effects between expanding globally and serving American consumers in the form of more 

competition. 

I am not sure that the Department of Justice has the ability to 

even, you know, take that larger view of how consolidation is 

changing sort of a moving target in the industry. It is a bigger sort 

of policy issue, aviation policy issue, I think that we need to keep 

our eye on very carefully. 

Senator LEE. Okay. Thank you. 

Let me shift to Mr. McGee. That leads into my next question for 

you. The Department of Justice has in the past focused much of its 

attention on the routes, on what a particular merger might do to 

routes, the concern being that if an airline through consolidation 

is able to achieve dominance over a flight between City A and City 

B, that there will be too much market concentration, they will be 

able to dominate the price, increase prices there, and competition 

will not be able to step in and effectively keep prices under control 

and thereby protect consumer welfare. 

In the case of this merger, as I understand it, of approximately 

900 routes that would be covered by the combined airline, only 

about a dozen or so overlap between the two partners in this proposed merger. So does that suggest that at least that part of the 

antitrust analysis suggests that this is mostly okay? 

Mr. MCGEE. No, I think, you know, Consumers Union has some 

concerns about the analysis being a little narrow in that sense. 

Certainly it is important to look at head-to-head, nonstop competition, and that is certainly probably the first thing you would look 

at. But, you know, as Mr. Horton pointed out—— 
39 

Senator LEE. But that aspect of it you would concede is not a red 

flag, I mean, 900 routes, 12 overlap? 

Mr. MCGEE. Relatively. I mean, obviously, if you live in those cities or you do business in those cities, it is certainly a big concern. 

But I was going to say, as Mr. Horton pointed out earlier, we are 

talking about network carriers here. So, you know, you can basically pick any two points on the domestic map and say that, you 

know, these two carriers have a fair shot at competing over their 

hubs because of, you know, the geographic penetration. 

So, in other words, in order to get, you know, from Savannah to, 

you know, Milwaukee, you may choose to do it through Charlotte, 

or you may choose to do it through, you know, Atlanta with Delta, 

or you may—I am not even sure if, you know, American would 

serve that through Miami. But, clearly, you know, there are a 

whole plethora of options. 

So when you are looking at network carriers, you really are looking at a much, much bigger scope, and I guess the question is, you 

know, how closely is the DOJ looking at that? 

Senator LEE. Okay. Thank you. 

We have talked a lot today about consumer welfare, and we have 

acknowledged the fact that the best way to protect consumer welfare is through robust competition, making sure that within the 

marketplace and within the market that we are examining that 

there is effective, strong competition. You know, in response to 

questions about competition, proponents of the merger have suggested that this transaction, if approved, if it proceeds, will have 

important pro-competitive effects. 

I would like to just sort of close by giving Mr. Horton and Mr. 

Parker a chance to respond to some of the statements that have 

been made on the other side of this and sum up by providing in 

brief form what you think are the benefits to competition and consequently to consumer welfare that could be achieved through this 

merger. 

Mr. HORTON. Well, maybe I will start. I think a strong U.S. airline industry is important to the U.S. economy and is important to 

all Americans. And I do think that consolidation has been part of 

creating a healthier U.S. industry more able to invest on behalf of 

our customers. You certainly see that at American. I think you will 

see it at the new American. 

It is about choice. You know, this merger will create more choice 

for customers, more ability to fly to more places, to connect more 

dots on the map and create a third, truly global competitor to the 

big U.S. airlines we compete with, but also the global airlines that 

we compete with. This is a globally competitive industry now. 

So I think it is about creating more choice, more opportunities 

for customers, and we think that is good for American, we think 

it is good for US Airways, we think it is good for America. 

Senator LEE. Mr. Parker. 

Mr. PARKER. Well, that was well said by Tom. I would just like 

to also follow on thanking you for your comments about the importance of our business. Some do not understand how important the 

airline business is to the U.S. economy. As you noted, one in eight 

jobs is in some way tied to the airline business. It is a vitally important business that needs the ability to compete, and we need to 
40 

have strong and vibrant competitors. Either of our airlines could 

compete independently. No one is here suggesting that we could 

not. What we are saying is we can compete better together. We can 

provide better competition, we can provide better service to consumers once merged. And I think that is good, as Tom noted, for 

the country, for consumers, and that is why we are here. 

I do want to come back a little bit, if I can, to the question that 

you asked Dr. Moss about barriers to entry. The reality is there are 

no barriers to entry in this business. Because we have worked so 

hard to modernize our fleets at the larger airlines, there is a large 

amount—there are large and inexpensive aircraft for any entrepreneur that wants to go buy a fleet of airplanes cheaply, the airplanes are out there. If you just go ask your favorite entrepreneur 

why they do not go do that, you know, they will not tell you, ‘‘Oh, 

because I cannot find airplanes.’’ They will not tell you, ‘‘Oh, because I cannot fly the routes I want to fly.’’ They will tell you, ‘‘Because I cannot make any money doing it.’’ It is too intensely competitive, and you cannot cover your costs of capital by starting up 

a new airline, not because of barriers to entry but because it is so 

competitive you cannot make any money. 

Senator LEE. I assume some would add to that, though, the regulatory burden is so—— 

Mr. PARKER. That is part of it. It is expense as well, yes, sir. It 

is expenses—— 

Senator LEE. Lawyers are not cheap, as it turns out. 

[Laughter.] 

Mr. PARKER. Yes. But, no, honestly I would encourage you to go 

ask any entrepreneur why it is, and that is what you will hear. You 

will hear that it is expensive, it is highly regulated. But mostly 

they will tell you, ‘‘Why would I want to invest now in that business? It is too competitive.’’ 

So, anyway, with that said, I will just come back to where Tom 

ended up, which is we think this is great for—we know it is great 

for our two airlines, for the employees of both airlines, and we 

know it is great for consumers, because we are going to create a 

stronger airline that provides customers more choice. 

Senator LEE. Okay. Thank you. 

Thank you, Madam Chairman. 

Chairman KLOBUCHAR. Thank you, Senator Lee. 

Thank you to all our witnesses. This concludes the hearing. I 

wanted to thank my staff, Caroline Holland, who previously 

worked with Senator Kohl, who is our staff director; Craig Helcott, 

my counsel; and also Maria Lavadeer for their work on this. And 

I know Senator Lee has staff working diligently on this as well. I 

want to thank them for their work. And I want to thank the witnesses for appearing today. You have provided meaningful insight 

into this merger and the challenges that are faced by the companies in an ever-competitive international market, but also as has 

been pointed out, the challenges that are faced by consumers as we 

try to look at these things not only in terms of the airlines’ ability 

to compete in a global market and the reason that would create incentives for merging, but also what is going to happen then to people not just in the smaller markets but also actually in some major 

metropolitan markets and to make sure that they get the service 
41 

they need, that fares are kept at an affordable level, and that our 

airline industry, which is, as we have pointed out, so important to 

our country that it benefits everyone in this country. 

So that was one of the reasons we wanted to see this GAO study 

because we think it will be important to look at it not just in the 

context, as Dr. Moss pointed out, in one merger, but also in the 

context of the entire industry. 

I want to thank everyone for attending. As I said, the record will 

remain open for a week for any remaining submissions or testimony. Thank you very much. The hearing is adjourned. 

[Whereupon, at 12:07 p.m., the Subcommittee was adjourned.] 

[Additional material submitted for the record follows.] 

(43) 

A P P E N D I X 

ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD
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PREPARED JOINT STATEMENT OF DOUGLAS PARKER AND THOMAS HORTON
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PREPARED STATEMENT OF DIANA L. MOSS
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PREPARED STATEMENT OF WILLIAM J. MCGEE
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QUESTIONS SUBMITTED TO DOUGLAS PARKER BY SENATOR KLOBUCHAR
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QUESTIONS SUBMITTED TO THOMAS HORTON BY SENATOR KLOBUCHAR
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QUESTIONS SUBMITTED TO DIANA L. MOSS BY SENATOR KLOBUCHAR
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QUESTIONS SUBMITTED TO WILLIAM J. MCGEE BY SENATOR KLOBUCHAR
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QUESTIONS SUBMITTED TO DOUGLAS PARKER BY SENATOR LEE
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QUESTIONS SUBMITTED TO THOMAS HORTON BY SENATOR LEE
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QUESTIONS SUBMITTED TO DIANA L. MOSS BY SENATOR LEE
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QUESTIONS SUBMITTED TO WILLIAM J. MCGEE BY SENATOR LEE
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QUESTIONS SUBMITTED TO THOMAS HORTON BY SENATOR BLUMENTHAL
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QUESTIONS SUBMITTED TO DIANA L. MOSS BY SENATOR BLUMENTHAL
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QUESTIONS SUBMITTED TO DOUGLAS PARKER BY SENATOR BLUMENTHAL
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RESPONSES OF THOMAS HORTON TO QUESTIONS SUBMITTED

BY SENATORS BLUMENTHAL, KLOBUCHAR, AND LEE
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RESPONSES OF WILLIAM J. MCGEE TO QUESTIONS SUBMITTED

BY SENATORS KLOBUCHAR AND LEE
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RESPONSES OF DIANA L. MOSS TO QUESTIONS SUBMITTED

BY SENATORS BLUMENTHAL, KLOBUCHAR, AND LEE
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RESPONSES OF DOUGLAS PARKER TO QUESTIONS SUBMITTED

BY SENATORS BLUMENTHAL, KLOBUCHAR, AND LEE
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MISCELLANEOUS SUBMISSIONS FOR THE RECORD
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ADDITIONAL SUBMISSIONS FOR THE RECORD

A list of material and links can be found below for Submissions for the Record not 

printed due to voluminous nature, previously printed by an agency of the Federal 

Government, or other criteria determined by the Committee: 

Ferriss, Bruce, and Barbara Ferriss, Spokespersons, Association of Professional 

Flight Attendants (APFA), and Former TWA Flight Attendants, attachments: 

http://twajustice.com/senatelexhibits.html 

Mitchell, Kevin, Chairman, Business Travel Coalition, statement: 

http://judiciary.house.gov/hearings/113th/02262013l2/ 

Mitchell%2002262013.pdf 

Moss, Diana L., Ph.D., Director and Vice President, American Antitrust 

Institute (AAI), additional submission: 

http://www.antitrustinstitute.org/∼antitrust/sites/default/files/ 

AAIlBTClUSAir-AAlWhite%20Paperl8-7.pdf 

Æ