Yesterday, the boards of directors for Continental Airlines and United Airlines agreed to merge the two companies, creating the largest airline carrier. The new company will bear the United name and the Continental brand will cease to exist. If the government approves the merger, like it did recently for Delta and Northwest, there will be even less competition in the marketplace and less incentive for airlines to work to woo customers.
A quick survey shows that air travelers are generally more satisfied with Continental than they are with United, so this merger will be unfavorable for customers, at least at first.
I’ve accumulated some frequent flier miles on Continental, and I’ve been hoping to use them all this year. Judging from the Delta/Northwest merger earlier this year, Continental’s OnePass program will be merged with United’s MileagePlus program, although the entire merger process will likely take a long time to complete. Both airlines are members of StarAlliance, a collective of airline companies that allow a limited range of benefits across airlines for frequent fliers.
What do you think about this merger?
Published or updated May 3, 2010. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @flexo on Twitter and visit our Facebook page for more updates.
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Luke Landes founded Consumerism Commentary in 2003 and has been building online communities since 1990. Luke, also known as Flexo, has contributed to PC World Magazine, US News, Forbes, and other publications. 
{ 6 comments… read them below or add one }
The airlines are pros at figuring out new and creative ways to lose money.
I think it’s good… Continental can teach United a thing or two about customer service.
Well i am glad i will be able to merge miles, but i am sure i will lose my SEA-CLE route at some point.
I read that Continentals CEO will chair the combined company (if approved), which is a good thing for passengers, I think. IMHO, the service at Continental surpasses United service exponentially, so maybe he can bring whatever creates that at Continental into the deal.
This is horrible news to me.
The airline industry is already gauging customers and less competition only worsens that.
There’s good reason why the new combined airline is using United’s name but Continental’s branding, and you touched on it above – United has a vast international route network, but is generally thought of as a legacy carrier in decline (or, if you believe the UA frequent fliers over on FlyerTalk.com, a legacy carrier in rebound); Continental, on the other hand, has worked very hard over the last 20 years to rebuild their brand, and the result is any number of JD Power & Associate awards, top survey rankings, etc. Which is how you get to this:
As far as the Frequent Flier programs go, unlike the Delta/Northwest merger, CO’s OnePass & UA’s Mileage Plus programs are already pretty closely lined up by virtue of the existing CO/UA operating alliance (the ‘virtual merger’ from last year that resulted in CO joining Star Alliance). The two programs have been modified to offer similar award schemes, redemption benefits, and will be offering reciprocal elite benefits.
It’s that last point that will probably cause come consternation among frequent fliers – both OnePass & Mileage Plus have three elite tiers, but there’s a big difference on the qualification for the top tier. UA’s program requires fliers to accumulate 100,000 qualifying miles in a year to earn their top tier (1K), while fliers can qualify for CO’s Platinum elite level at 75,000 qualifying miles. I’m sure there will be some wrangling between the two sides to work out this point, but don’t expect resolution anytime soon – the two airlines will operate as independent carriers until the deal closes, and more than likely OnePass/Mileage Plus consolidation will take place about 6-12 months after the merger is finalized.