American Airlines’ parent company, AMR Corp. and US Airways Group Inc. officially announced that their $17 billion merger was complete on Monday December 10, creating the world’s largest airline. The newly merged entity is called The American Airlines Group Inc. (NASDAQ: AAL) and has US Airways’ CEO Doug Parker at the helm. Parker has been one of the most vocal advocates of airline industry consolidation, maintaining that it is good for the companies, employees, and stockholders involved. The union has created an airlines that is unquestionably the largest air carrier in the world, with a global network of nearly 6,700 flights daily with over 330 destinations. With the merger, only four airlines control about 85 percent of the American market. They are: Delta, American, United and Southwest.
Mr. Parker is highly qualified to take the helm of the airline. Under his leadership, US Airways realized record revenue growth, profit margins, and operational performance
His experience prior to joining America West in 1995 saw four years with Northwest Airlines as Vice President and Assistant Treasurer, as well as Vice President of Financial Planning. In the five years from 1986 to 1991, he shouldered a number of financial management positions with American Airlines.
Parker was interviewed this week on CNBC’s Squawk Box about the merger saying, “The three of us (American, United, and Delta) have now the ability to take people pretty much anywhere in the world. What used to be a business where it was purely on schedule, if you have the ability to take people everywhere, you have to compete on product. And we’re prepared to do that.”
He also noted that with American coming out of bankruptcy with the merger that airlines that aren’t profitable won’t be able to grow. “We expect to produce a profit that will provide a nice return for our investors. That’s what they expect. And that’s what we plan to deliver.”
Parker received a Bachelor of Arts degree in economics from Albion College in 1984 and a Master of Business Administration degree from Vanderbilt University in 1986. He has made it clear that he is wholeheartedly committed to making the merger nothing short of a success. He certainly has the chops to make it happen if his resume is any indication.
The American Airlines Group Inc. began trading Monday on the Nasdaq under the ticker AAL with shares trading at around $25 per at the time of this writing.