US Airways highlights drawbacks of consolidation

0 Comments | USA TODAY, March, 2008 | by Dan Reed

TEMPE, Ariz. -- Their marriage was billed as the bold deal that would pave the way for the next -- and perhaps last -- round of airline consolidation.

Thirty months after near-bankrupt America West acquired the larger but twice-bankrupt US Airways, saving it from almost certain liquidation, the merged company is at best only a qualified success. If anything, it has illuminated once again just why there have been so few successful mergers in the airline business.

The merged carrier, named US Airways but led by America West's management, had the second-best operating profit margin among all U.S. carriers last year and the best margin over the last two-year period. But widespread flight delays, a botched integration of the two airlines' reservations systems, a...