United Airlines CEO Scott Kirby confirmed Monday that he approached rival American Airlines about a potential merger, marking his first public acknowledgment of the proposal. Kirby said in a statement released Monday that he believed the combination would benefit travelers, but he said American declined to engage and instead publicly closed the door.
Kirby wrote that he was “confident that this combination, which would have been about adding and not subtracting, creating a truly great airline that customers love, could get regulatory approval.” He said he had hoped to pitch that idea directly to American, adding: “I was hoping to pitch that story to American, but they declined to engage and instead responded by publicly closing the door.”
The confirmation comes after weeks of public speculation about a possible merger between two of the biggest U.S. airlines. Reports during that period suggested Kirby had raised the idea with the White House, though it remained unclear Monday whether his approach to American came before or after any White House meeting.
American publicly shot down the idea in an April 17 statement, saying it “is not engaged with or interested in any discussions regarding a merger with United Airlines.” The company also said a combined airline “would be negative for competition and for consumers,” and warned it could raise antitrust concerns.
Fort Worth, Texas-based American Airlines is itself the product of a 2013 merger with US Airways Group. Kirby, who previously served as president of American Airlines, argued Monday that a merger would expand service, create a more globally competitive airline and boost the U.S. economy by generating jobs and strengthening the aircraft manufacturing sector.
The rivalry between United and American has long featured pricing battles and operational disputes over gate access at major hubs, including Chicago’s O’Hare International Airport. Amid those competitive tensions, the Federal Aviation Administration this month ordered about 300 daily flights cut from peak summer schedules at O’Hare, saying planned increases by both carriers risked overwhelming an airport already dealing with severe delays.
The FAA said the order will take effect June 2, later than initially planned, after it said last week it wanted to give airlines additional time to adjust their schedules. The merger discussion is occurring as airlines face financial pressure tied to higher jet-fuel costs, including price impacts tied to the Iran war that began in late February.
On Monday, shares of Chicago-based United fell 1.2%, to $91.90, and were down about 18% for the year. American shares fell about 3.5% to $11.68 and were down nearly 24% for the year. Jet fuel is typically one of the largest expenses for airlines, and supply shocks and price spikes can quickly raise operating costs, with many carriers responding by increasing fares and fees—while both United and American have raised checked baggage fees in response to broader cost pressures.