Southwest Airlines to acquire AirTran

Southwest Airlines announced today it has entered into an agreement to acquire all of the outstanding common stock of AirTran holdings, Inc. – the parent company of AirTran Airways – for cash and Southwest common stock. Here is a fun fact sheet about the two airlines.

I find it interesting that this agreement does not require labor approval. In Southwest's attempt to purchase Frontier, Southwest was all about a pilots’ deal, so the story is much different in this situation. It will be interesting how all of this shakes down.

Southwest is able to build up their New York strength with LaGuardia and begin to get a presence in our nation's capital city and also put pressure on Delta Airlines with AirTran already having a strong presence in Atlanta. Southwest will now be an international airline, servicing Canada, Mexico and the Caribbean.

As we blogged earlier this year, when airlines merge, customers usually come up on the short end. In short, fewer airlines mean less competition and likely higher fares. Fewer airlines mean less availability. That direct flight might now involve a stop (or two) in order to get to your final vacation spot. Less availability could also mean taking flights at times we aren't used to flying – like an early 6:00am flight to catch a connection (often with a long layover) – in order to get to where you are going.

American Express, US Airways and Continental

American Express announced today changes in their relationship with Continental Airlines. Even though most of these changes won't take place until September 30, 2011, they have an impact for cardholders. After September 30, 2011, American Express cardholders will no longer be able to redeem points for frequent flyer miles into the Continental OnePass frequent flyer program. Currently, Platinum and Centurion members also receive complimentary access to Continental Airlines President Club lounges when traveling on Continental Airlines; that benefit will end as well on September 30, 2011.

There is good news, though! Starting December 1, 2010, for those Platinum and Centurion card members there are three new benefits:

A. $200 airline fee credit. This credit can be used in many ways: baggage fees, flight changes fees, in-flight food and airport lounge day passes. This will be $200 each year as well. Card must be enrolled with the airline. (The list of airlines have not been announced yet.)

B. 20% Travel Bonus. When you use your American Express points in the pay-with-points program (through AFC Net you can use your American Express points to pay for your travel), you will receive back a 20% bonus in points. You can use your points in the pay-with-points program for almost any travel -- airlines, hotels, cruises, and vacation packages.

C. American Express App. Those with phones that qualify can download an all-new American Express App which is great for those who travel a little or travel a lot.

American Express also announced they have added the US Airways Club access as one of the benefits for Platinum and Centurion cardholders. There are over 250 of these clubs worldwide.