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United Airlines Chief Executive Scott Kirby said this week the carrier will not pursue industry consolidation for the foreseeable future after American Airlines rebuffed his approach for a potential merger.
Speaking at a Bernstein investor conference, Kirby said only a “big transaction” would make economic sense for United and that a willing partner is required, which he does not have.
He described speculation that the outreach to American was a cover for smaller deals as “idiotic,” and dismissed the idea of pursuing smaller acquisitions such as JetBlue, saying United would need to improve JetBlue’s margin by roughly 25 percentage points to make a deal viable.
Kirby also warned that ultra-low-cost carriers may contract to leisure routes as competition and airport costs bite.
The CEO said United expects to reach double-digit pre-tax margins next year as easing fuel costs and resilient demand help recovery, though the carrier has trimmed some unprofitable capacity.
The outreach to American — which CEO Robert Isom rejected as anti-competitive and said the airlines were “not getting married” — followed earlier reports that Kirby raised the idea with U.S. officials in February.





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