Now Arriving: Mergers

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But this time Parker may have misjudged his target. Delta CEO Gerald Grinstein, 74, is angry that US Airways charged ahead with an unsolicited offer. To do the deal, US Airways has to get a full look at Delta's books; so far Delta execs have shown little interest in sharing. Another trouble spot may be pilots, who have waged and mostly lost battles with the airlines over salary and benefit concessions. US Airways should expect no favors. "Management must first focus on fulfilling the promises made to their investors, customers and employees for the America West--US Airways merger," says Captain Kevin Kent, a representative of America West's pilots union. Then there's Delta's status as a bankrupt. That gives creditors like GE and Boeing a say in the matter, although Delta is the only entity that can make a reorganization or merger proposal to the bankruptcy court between now and Feb. 15.

There are other potential negatives. Fares would probably go up on routes where the two airlines now compete. Both need to pull up their socks when it comes to customer service, once a Delta strength and always a US Airways weakness. And integrating the US Airways fleet, which favors European-made Airbus planes, with Delta's all-Boeing operation might be difficult. Also, the combined US Airways--Delta would account for 18% of the market, which competition watchdogs think is too high. But the government, which must approve the merger, gets a vote and presumably could order the merged carrier to sell off routes, and that might mean more opportunity for LCCs.

All that may be putting off the inevitable. For big airlines, bigger might just be better. For now.

With reporting by Greg Fulton/Atlanta

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