Justice Dept. Clears Way For Continental-United Merger

The marriage between Continental and United Airlines got one huge step closer to happening on Friday when investigators at the Justice Department wrapped up their four-month inquiry into the merger and offered its blessing.

With this hurdle out of the way, it’s possible that the union could be finalized by Oct. 1. All that remains is final approval form the Dept. of Transportation and the airlines’ stockholders.

The DOJ’s investigation found that the two airlines have “largely complementary networks” with little overlap on nonstop routes. However, the regulators did express concern that the airlines’ combined 442 daily round-trip flights out of Newark Liberty International Airport — where Continental already controls more than 60% of air travel — could be too overwhelming a presence at the airport.

So to get the wheels of Justice rolling on the deal, the two airlines agreed to lease 18 slots for round-trip flights at Newark to Southwest Airlines. The idea is that this would give consumers a low-cost option at Newark and give the discount airline a second airport presence in the NYC metro area. If the merger is completed by Nov. 30, Southwest would begin having access to those slots in March 2011.

Some insiders are not impressed with what they believe is a small concession on the part of Continental-United. “I find 18 slots to be a remarkably small amount of grease to get this thing approved,” aviation consultant Robert Mann tells the Chicago Tribune, “when you consider the Continental-United position at Newark.”

Regulators clear United-Continental merger for takeoff [Chicago Tribune]

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  1. lenagainster says:

    Will they call the new airline Uncontinent?

  2. SexCpotatoes says:

    Looks like someone finally found the right palm to grease in the last four months.

  3. SexCpotatoes says:

    Looks like someone finally found the right palm to grease in the last four months.

  4. DingoAndTheBaby says:

    How kind of Continental…”Here, as a concession of our merger, we’ll offer you an alternative to our newly-formed mega-conglomorate. Of course, it’s not *really* a viable alternative considering we now dominate international air travel out of this airport. But, well, you know how it goes. Now bend over. Here it comes. What? Of course we didn’t use any lubricant. Silly consumer.”

    • DingoAndTheBaby says:

      *Make that “Continental/United”…or just “United”, if it suits.

    • tedyc03 says:

      Lubricant has a $15 pain-reduction fee.

    • jamar0303 says:

      I think the main counter to that is that the NYC area has four separate airports servicing it. One of which is definitely a viable alternative for int’l travel.

      • BridgetPentheus says:

        not if you live in Jersey, it costs so much more to get out to any of the other airports and the time it can take can add hours to your journey, not so viable

  5. diddy0071 says:

    Contited sounds good.

  6. Nick1693 says:

    I’m confused. Unprofitable airlines can merge, but the people who bring TV into your home can’t buy a TV network?

    • ARP says:

      There are other competitors that serve most of their routes. There isn’t a second network doing 30 Rock episodes that we can buy from instead.

  7. Oranges w/ Cheese says:

    FAIL.

  8. cromartie says:

    The term “Justice Department” is relative in this, as in most, cases.

    On the plus side, two crappy airlines I don’t fly anymore have combined into one crappy airline I don’t have to fly anymore. So there’s that.

  9. fairandbalanced says:

    Hmmm…. The 2nd and 3rd worst airlines merge to become, what????

    Also, why would you give anything to southwest which is the worst airline?

    • gerald.saul says:

      How is Southwest the “worst airline”? They are a profitable company that offers affordable flights and an overall pleasant customer experience.

    • Truthie says:

      Continental is probably the best legacy carrier… so it’s hard to call them the 2nd or 3rd worst airline. They’re definitely further down the list.

      It’s sad to see them merge with United, which is definitely in contention for worst.

    • Warren - aka The Piddler on the Roof says:

      How is Southwest the worst airline? I’ve never had a problem with them. United, on the other hand, thinks it’s fun to change the time of your flight departures on a whim. You know, for a goof.

      I’d never fly with any airline that sells me a ticket for a 9:00 a.m. flight and then tells me the departure time has been changed to 11:30 a.m. when I arrive at the counter. What the hell is that anyway?

  10. econobiker says:

    One thing only to say:

    untied.com

  11. fsnuffer says:

    Gordon Bethune: “From Worst to First”

    Jeffery Smisek: “From First back to Worst”

  12. MFfan310 says:

    How about Uninental? Or Continited?

  13. Duckula22 says:

    Continental wants to learn how to break guitars, apparently.

  14. Brink006 says:

    My hope is that Continental adopts United’s premium economy seating as opposed to their own premium economy seating that offers such amenities as… being closer to the doorway…. and… umm….

  15. Sheogorath says:

    United in Mediocrity.

  16. ChoralScholar says:

    Does Southwest WANT 18 slots at EWR? I mean, did they ASK for them?

  17. ChoralScholar says:

    I understand the DOJ’s concern with United and Continental having a huge share of the traffic at EWR – but what about the places where it’s already de facto, such as DFW (American) or IAH (Houston) or ATL (Delta)…