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I read an interesting article on Bloomberg yesterday that noted a study ordered by Congress found that decreased competition in the airline industry thanks to major airline mergers like those of Continental/United and Delta/Northwest have meant a rise in flight delays and cancellations since 2005. The study looked at 2,500 routes and statistics from 2005-2012.
Mitchel Behm, an Assistant Inspector General of the Department of Transportation noted in the report that, “When competition decreased, both the average length of flight delays and percentage of total flights that were late increased.” Backing that claim up: in markets where the airline presence went from three major carriers down to 2, flight delays were lengthened by over 25%, and cancellations went up by 7%. In 2013, the DOT noted that 1.5% (or 96,000) flights were canceled and 22% (or 1.27 million) flights were delayed 15 minutes or more.
While the main message seems pretty clear, I actually think the statistics are slightly more mixed than they seem at first. That’s because the study ended just as the merger between United and Continental was finally cemented and the airline began operating as a single entity so hopefully since then they’ve ironed out some of their issues. That said, we’re bound to see a lot more headaches as the US Airways/American Airlines merger progresses, so those numbers could shoot right back up again.
All in all, I don’t think the results are terribly surprising given that where there is less competition there is less incentive to perform well. According to this CNN article from last year, mergers also result in more delays/cancellations, but also less dire but still annoying downsides like more lost luggage and passenger complaints. The one bright spot? Mergers haven’t meant skyrocketing airfares so far. The year-over-year increase in average airfares is just about 2% since 2004 despite several major mergers.
Still, it seems like flyers have had and are in for more delays and cancellations in the coming days and years. It seems like every other flight I’m on has an issue or two and I actually count myself lucky when we take off and land on time as it’s becoming more of a rarity. No wonder people hate airlines so much (and why United is at the bottom of the list!).
What do you think? Have these mergers led to more delays and cancellations in your own travel? Share your experiences below. Even after the introduction of the Chase Sapphire Reserve, the Chase Sapphire Preferred is still a fantastic choice if you want to avoid the Reserve’s $450 annual fee, earn 2x on all travel & dining and earn a 50,000 point sign up bonus.
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