The United Continental Holdings

NB: We do not resell your papers. Upon ordering, we do an original paper exclusively for you.

NB: All your data is kept safe from the public.

Before the merger with the United Airline, Continental airline was ranked as the fourth airline in the United States of America. The airline had hubs in Houston, Newark and Cleveland. The airline had well established networks globally and operated over 2,700 flights daily in over 240 destinations.

Some of its major destinations were in Europe, Northern, Central and Southern America as well as Asia. On the other hand, the United Airline was by then the third largest Airline in the United State of America. The airline had hubs in San Francisco, Denver, Los Angels and Washington DC. It operated more than 3, 300 flights daily to more than 230 destinations globally.

The merger of the United States of America third and fourth largest airlines the United Airlines and Continental airlines formed the United States largest Airline Corporation referred as the United Continental Holdings, Inc. The brand of the new entity is delivered from the brands of its mother brands.

The airline possesses the continental lively logo and colors with the United Airline name. The heard quarters of the United Continental Holdings, Inc is based in Chicago. The United Continental Holdings, Inc maintains a significant presence in Houston which is expected to be the airlines largest hub. That is the reason why the CEO of the entity opted to have its offices in both Houston and Chicago (Armin, 2010).

It is noted that there are strong incentives for airline consolidations. This is because the economies of scale and scope provide larger airlines with the competitive edge over smaller airlines. This is because airline mergers facilitate airlines to lower down their costs of operations.

Lower costs of operations enable the large airlines to offer their customers services at a discounted rate which enhances their demands greatly. Similarly, mergers of airlines have been known to reduce competitions and thus improve their market power especially on non-stop routes to and from hubs.

The merger between the Continental Airline and the United Airline was not expected to affect the routes they were serving. The resultant merger is expected to continue operating in all the routes that the two airlines were operating. The merger is likely to increase the performance of the resultant airline greatly.

The United Continental Holdings, Inc commands a 21% market share in the United States of the American air travel which makes it the largest airline in the United States of America ahead of the Delta Airline that commands a current market share of 20%.

This makes the airline to enjoy the advantage of the scale of economies by cutting down its costs of services which in turn increase its demand considerably. The merger between continental airline and united airline had greatly helped the two airlines to reduce airline competition in the U.S. greatly especially in those routes they initially competed.

Less competition will help the airline corporation to control the pricing of flight fares accordingly since customers do not have many alternatives. The merger is likely to see the customers paying more because the rationale for mergers is to reduce the capacity.

This involves cutting down the number of seats in the industry and thus increasing airline fares. The merger is likely to bring overlapping flights to 13 nonstop destinations including flights to and from Houston and Denver (Mouawad & Merced 2010).

The United Continental Holdings, Inc transports its customers and cargo via their highway that uses full sized jet aircraft. Similarly, they operate local operations that use smaller aircrafts that are run under contract by the Continental, United express and Continental Connection carriers.

The United Continental Holdings, Inc has its Key air rights in Pacific region, Middle East, U.S., Latin America, Africa and Middle East. The United Continental Holdings, Inc local hubs are strategically located in densely populated and busy business areas that act as major origins and destinations to many people.

The hub and spoke system of the United Continental Holdings, Inc allows it to traffic passengers to a large number of destinations with considerable more recurrent service than if each mainline was served on its own. The hub of the United Continental Holdings, Inc enables it to add service to new destinations from many major cities using one or limited number of aircrafts (Rowe, 2011).

The United Continental Holdings, Inc will require maintaining the alliances that the United Airlines and Continental Airline had established in the previous operations. These bilateral and multilateral alliances that the United Airline and the Continental Airline can help the corporations to enhance travel options for those clients that aspire to travel to markets that the United Continental Holdings, Inc does not serve directly. Examples of these alliances include joint royalty program participation.

This alliance results when seats on one carrier’s selected flight is labeled with brand name of a different carrier. Others alliances include coordination of reservations as well as flight schedules. The United Airline and the Continental Airline were members of the Star Alliance which is the largest Airline in the world.

Therefore, the United Continental Holdings, Inc should automatically become an affiliated member of the Star Alliance in order for it to benefit from coordination of its air travels especially for those customers that aspire travelling to those destinations that the United Continental Holdings, Inc does not operate.

The United Continental Holdings, Inc provides different services that are costumed to distinct customer groups. This concept of product segmentation makes the corporation outstanding and it also helps the United Continental Holdings to optimize costs.

The concept is aimed at enhancing the experiences of all its clients. Some of these services include 180-degree, lie flat beds that are costumed for first and business class as well as Audio video entertainments in economy seats. These services make the corporation special and unique which helps it to attract many customers since it service are tailored to address the needs of all categories of customers.

The United Continental Holdings combined and consolidated the United and Continental traffics. The consolidation of the traffic resulted to a decrease of 5.1% revenue passenger miles in October 2010. Similarly, the corporation resulted in a decrease of 1.5% in carriers combined consolidated factor by October 2011 in relation to the total performance of the two airlines at the same time last year.

The United Continental Holdings, Inc is a consolidation of the United and the Continental airlines. In addition, the holding together with the affiliated airlines continental express, United express and Continental Connections manages 5,717 flights daily in more than 376 airports in six continents.

Their main hubs are Chicago, Houston, Cleveland, Los Angeles, San Francisco, Tokyo, Denver, New York and Washing D.C. The United Continental Holdings, Inc has an alliance with the Star Alliance that provides it with more than 21,200 flights on daily basis to 1,185 airports in 185 airports (the United Continental Holdings, Inc., 2011).

The move of the United Airline and the Continental Airline to merge to form the United Continental Holdings, Inc was a strategic move for the two corporations. The merge enabled the United Continental Holdings, Inc to become the largest Airline in the United States of America which will greatly enable it to benefit from the economies of scale and enhance its performance greatly by increasing shareholders’ investments, employments and services rendered to customers.

Reference List

Armin. (2010). The United and Continental Airline Mash up. Web.

Mouawad, J. & Merced, M. (2010). United and Continental Said to Agree to Merge. Web.

Rowe, Z. (2011).United Continental Holdings, Inc. and Subsidiary Companies. Web.

Click Here To Order Now!

The United Continental Holdings

Do you need this or any other assignment done for you from scratch?

We have qualified writers to help you.

We assure you a quality paper that is 100% free from plagiarism and AI.

You can choose either format of your choice ( Apa, Mla, Havard, Chicago, or any other)