Mergers, Bankruptcies and Uncertainty
Like a jetliner hitting an air pocket at 30,000 feet, the U.S. airline industry has entered a time of turbulence. Each month brings new accounts of disarray among the air carriers, as firms go bankrupt, merge and acquire one another at a dizzying pace. The announcement in September that Texas Air Corp. would seek to buy People Express Inc.—the upstart airline that shook up the air-travel business through cut-rate, no-frills service—was only the latest in a string of corporate maneuvers that may portend a radical shift in control of the $50 billion-a-year industry. Another was the financial collapse in late August of Frontier Airlines Inc., a major Western-states carrier that had been taken over by People's earlier in the year. Along ...