The Impact Of Airline Mergers And

Consolidation On Consumers And

The Aviation Industry

Advisory Committee For Aviation 

Consumer Protection

Washington, DC

Deborah McElroy

Executive Vice President October 29, 2014
Who We Are

• Airports Council International – North America (ACI-NA) 

represents local, regional and state governing bodies that 

own and operate commercial airports in the United States 

and Canada.

• ACI-NA’s 207 airport members operate 360 airports, 

enplaning more than 95 percent of the domestic and 

virtually all the international airline passenger and cargo 

traffic in North America.
Who We Are, Continued

• The mission of ACI-NA is to advocate policies and provide 

services that strengthen the ability of commercial airports 

to serve their passengers, customers and communities.

• ACI-NA works in collaboration with Airports Council 

International (ACI) to advocate for airport issues before the 

International Civil Aviation Organization.
Recent U.S. Mergers and Acquisitions

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

• Republic Airways / 

Shuttle America

• US Airways / 

America West

• Skywest / Atlantic 

Southeast Airlines

• Pinnacle 

Airlines / 

Colgan 

Air

• Delta 

Airlines / 

Northwe

st 

Airlines

• Republic Airlines 

/ Midwest 

Airlines 

• Republic Airlines 

/ Frontier Airlines

• United Airlines / Continental Airlines

• Pinnacle Airlines / Mesaba Airlines

• Skywest / Atlantic Southeast Airlines / 

ExpressJet Airlines

• TransStates Airlines / Compass Airlines

• Southwest 

Airlines / AirTran 

Airways

• US Airways / American Airlines

• Pinnacle Airlines / Delta Air 

Lines

• Delta Air Lines Acquires 49% 

Stake in Virgin Atlantic

Source: Respective Airline SEC filings

In the last few years, the United States has led the world in 

airline mergers and acquisitions.
Flight Capacity by Hub Sizes

2008 to 2014 - % Change Year Over Year

-2.9%

-5.1%

0.6% 0.4%

-0.7%

0.0% -0.6%

-6.5%

-11.6%

-3.8%

-2.5%

-5.2%

-2.3%

-3.7%

-4.7%

-7.8%

-0.7% -2.3%

-3.8% -4.7% -2.9% -3.9%

-8.1%

1.3%

-2.8%

-3.4%

-1.0%

-3.9% -4.2%

-6.8%

-0.5%

-0.8% -1.8% -0.9%

-2.0%

-14.0%

-12.0%

-10.0%

-8.0%

-6.0%

-4.0%

-2.0%

0.0%

2.0%

2008 2009 2010 2011 2012 2013 2014

Large Medium Small None TOTAL

While airports benefit from a healthy, successful airline industry, recent mergers and 

the resulting consolidated airline industry has significantly impacted airports of all 

sizes throughout the United States through reduced service and higher fares.
Airport Hubs: Traffic Trends

-12.0%

-10.0%

-8.0%

-6.0%

-4.0%

-2.0%

0.0%

2.0%

4.0%

-1.3% Flights Seats

3.5%

-10.8%

-4.2%

-10.3%

-4.2%

-8.4%

-3.1%

2014 versus 2011

Large Medium Small Non-Hub

All airports have seen reductions in flights over the last three years. Airports are 

focused on adding new service but are limited in the incentives that can be offered 

to airlines. 

Source: Diio Mi
Airport Priorities

In a recent survey, ACI-NA asked U.S. airport directors to 

identify their most significant challenges. Nearly 45 percent 

indicated air service development was the single biggest 

challenge facing their airports right now because of airline 

consolidation. 

We also asked airport directors to look five years into the 

future. Nearly 40 percent again identified providing price and 

service competition for their communities as the single 

biggest challenge they expect to face over the next five years. 
Airport Priorities, Continued

An adjusted Passenger Facility Charge local user fee 

adjusted from $4.50 to $8.50 and indexed for inflation will 

assist airports in modernizing their facilities to accommodate 

increased competition. 

DOT may also want to consider modernizing the regulations 

on air service incentives.
Growing International Air Service

The consolidated U.S. airline industry is 

growing its international network. U.S. airports 

are working with both domestic and foreign 

airlines for additional international flights. 

However, there have been a number of 

instances where staffing issues and CBP 

funding constraints resulted in the new service 

being denied by CBP. 

Additionally inadequate CBP staffing has led to 

delays in processing arriving international 

passengers, inconveniencing consumers.
Growing International Air Service, Continued

Airports and airlines are installing Automated Passport 

Control (APC) to more efficiently process arriving international 

passengers. Additionally, ACI-NA and Airside Mobile developed 

the Mobile Passport Control (MPC) which is now being piloted in 

Atlanta. 

Additionally, some airports have signed agreements with

CBP to pay for overtime expenses.

However, given increasing international travel, increasing

CBP staffing is an important consumer issue that should be

addressed.