Delta and Northwest Airlines Merger
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Delta and Northwest Airlines Merger
There are many reason in why a carrier will do a merger with another carrier. Faced with high fuel prices, grounded planes, canceled flights, high ticket prices, Delta and Northwest Airlines agreed on a merger. The carriers hope that this merger will help them stay in business during the difficult times of this economy (Stark, 2008). This section will discuss the background of the merger between Delta and Northwest Airlines.
April 14, 2008, Delta and Northwest Airlines announce the plans to merge (Stark, 2008). Once the merger is approved by responsive parties, it will create the worlds largest airline. The merger in important, recently before the announcement, other airline carriers filed for bankruptcy. On October 29, 2008 the merger of Delta with Northwest was approved by their shareholders and the Department of Justice (Delta, 2012). The carriers would finally fly as one carrier in January 2010. Although the merger is approved, the carriers will need to resolve labor, technology, and financial issues.
There are many advantages and disadvantages in doing a merger in the airline industry. There are a few reason this merger will be an advantage. One advantage is that this merger will form a global US carrier that can compete with foreign airlines. Once the merger is form, it will be the worlds largest airline carrier (Stark, 2008). Thus, passengers will be able to take advantage of the global route system the carrier will offer. With the global route the carrier will offer more destinations will be available as well as with more schedule options. The will also have a financial stability.