WASHINGTON Feb 19 The merger of American
Airlines and U.S. Airways to form the world's largest air
carrier threatens the credit quality of U.S. airports, Moody's
Investors Service said on Tuesday, as the combined airline may
eliminate routes or push up ticket prices.
American Airlines parent AMR Corp, which filed
for bankruptcy in November 2011, said last Thursday that it will
merge with US Airways Group.
The three major hubs for the airlines - Texas Dallas-Fort
Worth International, Miami International, and Charlotte Douglas
International Airport - could suffer from the merged company
combining its operations, according to the Moody's special
"The key risks for those airports are that the combined
carrier may reduce service on overlapping routes or reduce
service to markets connected by these hubs," the rating agency
said. "Such capacity reductions give airlines a greater ability
to raise fares, which in turn can result in lower passenger
Airports' revenues "are highly dependent on passenger
volumes." In the past five years, the number of airlines has
been cut in half, Moody's added, leaving airports exposed "to an
increasingly concentrated pool of airline counterparties."
Smaller airports that were dominated by the two separate
carriers, such as California's Fresno-Yosemite Valley Airport,
face greater risk from the fewer airplane landing fees, terminal
concessions, and parking fares as the number of passengers
passing through could shrink from the consolidation, it said.
"When coupled with difficult economic conditions, airline
mergers exacerbate the negative pressure already being exerted
on U.S. airports," Moody's added.