Continental, United Announce Global Cooperation Plan

Continental Airlines and United Airlines have announced a framework agreement to cooperate extensively, linking their networks and services worldwide. The idea, according to the airlines is to benefit of customers, and create revenue opportunities and cost savings and other efficiencies. In addition, Continental plans to join United in the Star Alliance, the most comprehensive airline alliance in the world.

Teams from the two organizations worked intensively over the last several weeks exploring creative solutions for how the two companies could achieve efficiencies and synergies that expand beyond the well-established benefits of codesharing.

Their work focused on plans for significant cooperation on frequent flier programs, lounges, facility utilization, information technology and procurement. This work was assisted by the efficiency opportunities identified and relationships developed during the parties’ earlier merger discussions.

Through this new partnership, Continental and United plan to establish joint ventures allowing them to cooperate with each other and with other Star Alliance airlines in international regions and compete more effectively in an increasingly global air travel market. Initially, Continental will request the U.S. Department of Transportation (DOT) to allow it to join United –along with Lufthansa, Air Canada and six other carriers- in their already established antitrust immunized alliance.

This will enable Continental, United, Lufthansa, Air Canada and other immunized Star Alliance carriers to work closely together as other antitrust immunized alliances do, and to establish trans-Atlantic and other international joint ventures so they can deliver highly competitive flight schedules, fares and service.

The planned trans-Atlantic joint venture, in which Continental, United, Lufthansa and Air Canada will pool revenue, will permit the carriers to compete more effectively with the proposed joint venture involving certain SkyTeam members that was recently granted antitrust immunity. The trans-Atlantic joint venture will combine the strength of the carriers to create a more efficient and comprehensive trans-Atlantic network for the carriers’ customers.