CHICAGO (AP) United Airlines scrapped its latest attempt to combine with US Airways and create the world's largest carrier, formally backing away Friday from a deal that likely would have meant fewer routes and higher ticket prices for consumers.
Now the question for those and other U.S. airlines is how to get by and make money with oil prices near $130 a barrel.
The CEOs of the two airlines told their employees in separate messages that a combination was off "for now," although US Airways' Doug Parker indicated it is unlikely for at least the rest of this year. They had spent months exploring a deal that would have enabled the carriers to shed costs likely paring employees, trimming overlapping operations in Washington, D.C., and parts of the West and eliminating competing flights.
But the attempt was hamstrung by tightening credit markets and the airlines' dimming financial outlook, which has dried up cash and made them less attractive to the banks that would have to provide capital.