United’s CEO closes the book on the failed American merger — and signals the carrier is eyeing gates, slots, and distressed assets as fuel costs batter weaker rivals.
United Airlines CEO Scott Kirby declared Sunday that large-scale industry consolidation is off the table for his carrier, pivoting publicly to a strategy of buying airport slots, gates, and distressed airline assets as rising fuel prices squeeze weaker rivals.
The announcement came on the sidelines of the International Air Transport Association’s 82nd Annual General Meeting in Rio de Janeiro, where Kirby addressed reporters and gave an interview to Reuters on June 7. His statements formally closed the chapter on a proposed megamerger with American Airlines that had rattled the U.S. aviation industry earlier this year — and opened a different one.
“I think consolidation is unlikely for United,” Kirby told Reuters. “That doesn’t mean we won’t still be in the market to buy assets, but consolidation is a low probability.”
The distinction carries real strategic weight. A full airline merger requires years of regulatory review, labor contract renegotiation, and systems integration. Acquiring gates and slots from a financially distressed competitor is faster, cheaper, and can deliver equivalent competitive reach at key airports — without the regulatory gauntlet.
The Merger That Wasn’t
The failed United-American proposal remains the backstory shaping Kirby’s new posture. Reuters reported in February that Kirby raised the concept of a combined carrier with President Donald Trump at the White House. American issued a public statement on April 17 declaring it was “not engaged with or interested in any discussions regarding a merger with United Airlines,” calling the tie-up “negative for competition and for consumers, and therefore inconsistent with our understanding of the administration’s philosophy towards the industry and principles of antitrust law.”
American CEO Robert Isom was more direct. Merging “the world’s two largest airlines together, that was a nonstarter from the get-go,” Isom said, calling it “anticompetitive” and “bad for customers, ultimately bad for American Airlines, bad for our team.”
Trump told CNBC in April that “I don’t like having them merge,” citing competition and consumer prices as his reasons. Neither the Justice Department nor the Transportation Department ever formally weighed in; a final deal was never filed with regulators.
On April 27, Kirby confirmed his overture in a public statement: “I approached American about exploring a combination because I thought we could do something incredible for customers together. I was hoping to pitch that story to American, but they declined to engage and instead responded by publicly closing the door. And without a willing partner, something this big simply can’t get done.”
At the IATA conference on Sunday, Kirby again defended the underlying logic of the deal but acknowledged the central obstacle — American’s management had gone on record against it. “You can’t have the management team on record publicly saying it was anti-competitive,” Kirby said. A deal of that scale, he added, “requires support from everyone” — specifically, “the unions, we’d need the customers, the shareholders, the regulators and the management team.” Regarding American’s leadership, he was blunt: “We don’t have that, clearly, so we can’t get it done without them.”
The proposed combination would have given the merged carrier a market share of just over 34% — a level of dominance not seen among U.S. carriers in years. Analysts had predicted the Justice Department would likely reject the deal as anticompetitive. U.S. senators wrote to Kirby in April expressing concern that a merger of that size would control nearly half of the U.S. domestic market.
Kirby also denied to Reuters that United had discussed giving the U.S. government a “golden share” or any stake in the combined company as part of a merger proposal.
When asked whether United might revisit the American idea, Kirby repeatedly said any deal would require “a willing partner.” Asked about broader combination opportunities in the industry, he was brief: “There’s nothing.”
Already Shopping: Spirit Gates at O’Hare
Kirby’s pivot to asset acquisitions is not purely rhetorical. In early February, United agreed to purchase two preferential use gates — G12 and G14 — from Spirit Airlines at Chicago O’Hare International Airport for approximately $30.2 million. Spirit had filed for Chapter 11 bankruptcy protection amid skyrocketing fuel costs and was selling off assets; the U.S. Bankruptcy Court for the Southern District of New York had separately approved Spirit’s sale of two other O’Hare gates to American Airlines for $30 million in December 2025.
The gate purchases were competitive by design. Kirby had previously stated that United would block American Airlines from gaining more gates at O’Hare, pledging to add as many flights as required to protect the carrier’s lead. United added 32 new destinations from O’Hare since early 2025 and planned 750 daily departures from the airport during the summer of 2026.
Fuel Shock and the Brand-Loyalty Divide
The strategic context for Kirby’s shift is a fuel crisis that has nearly doubled jet fuel prices since late February, triggered by the war in Iran. United reported a $340 million increase in fuel expenses in the first quarter of 2026 compared to the prior year, slashed its 2026 adjusted diluted earnings per share guidance to a range of $7 to $11 from a prior range of $12 to $14, and cut planned capacity by approximately 5 percentage points.
In a March memo to staff, Kirby said the airline was modeling oil at $175 per barrel and preparing for prices to potentially remain above $100 per barrel through the end of 2027. Under that scenario, United’s annual fuel bill could rise by approximately $11 billion — more than twice its best-ever annual profit.
At IATA, Kirby framed the crisis as a structural sorting mechanism — separating airlines that have invested in brand, product, and customer loyalty from those competing primarily on price. He rejected criticism from Willie Walsh, IATA’s director general, that large U.S. carriers are squeezing out competition, arguing that United and Delta are winning because they have invested in products and experiences that travelers value.
“Customers care about the technology, the service, the reliability, the product,” Kirby said. “They want a great experience. They don’t just want a seat.”
Kirby said United expects higher fares to put the carrier on track to recover the full fuel cost hit later in 2026. Fares booked in the weeks prior to the conference had risen 15% to 20%. United Chief Commercial Officer Andrew Nocella told analysts: “The longer the price of fuel remains in this range and the longer consumers pay these prices — and airlines adapt this revenue — the more it is likely to stick.”
On fuel hedging, Kirby dismissed the approach as a structural fix, calling it “ineffective if you lose money over time.” He also said United has no interest in acquiring a refinery as Delta Air Lines has done, even while acknowledging Delta’s refinery is providing some benefit in the current environment.
J.P. Morgan analysts noted that prolonged high fuel prices could accelerate a shakeout among weaker low-cost airlines, ultimately benefiting larger, brand-loyal carriers. Moody’s and S&P Global Ratings identified Delta and United as best-positioned to withstand a prolonged fuel crisis, citing the highest operating margins among rated U.S. airlines.
Delta Echoes Kirby — With Its Eye on the Pacific
Delta Air Lines President Peter Carter, speaking to CNBC on Saturday at the same conference, also ruled out mergers or acquisitions for Delta, saying the carrier’s longtime strategy has centered on partnerships and joint ventures in South Korea, Mexico, and Europe. Carter said the mature U.S. domestic market means international travel is the growth frontier, and that Delta wants to challenge United’s lead in the trans-Pacific market.
The declarations from both executives — the heads of the U.S. airline industry’s two most profitable carriers — amounted to a shared verdict on domestic consolidation: the era of transformative U.S. airline mergers has, for now, run its course.
Delta’s net profit exceeded $5 billion in the prior year while United earned approximately $3.35 billion; however, United held a commanding lead in trans-Pacific revenue, with approximately $6.89 billion compared to Delta’s approximately $2.79 billion in that segment.
The Consolidation Wave — And the Track Record Behind It
Kirby acknowledged the recent wave of industry deals while drawing a clear line at United’s door. Allegiant Air completed its approximately $1.5 billion acquisition of Sun Country Airlines on May 13, 2026, creating what the carriers described as the leading leisure-focused U.S. airline and operating approximately 195 aircraft to nearly 175 destinations. The deal closed in under five months. Alaska Airlines combined with Hawaiian Airlines in 2024.
“United’s not going to do a deal just to do a deal,” Kirby told reporters. “It’s a lot harder. I’ve been … one of the primary architects of consolidation in the United States. I’ve been around a lot of these deals. It’s hard, and you shouldn’t do deals that don’t make economic sense.”
United, founded in 1926 and headquartered in Chicago, has been shaped by successive mergers throughout its 100-year history. Its landmark transaction was the 2010 combination with Continental Airlines, one of the deals Kirby counts among his consolidation record. Kirby previously worked at American Airlines before joining United.
Kirby said he does not believe JetBlue Airways — now a United partner — is likely to file for Chapter 11, citing JetBlue’s cash reserves and unencumbered assets. He has repeatedly dismissed the idea of acquiring JetBlue outright.
Key Takeaways
- United Airlines CEO Scott Kirby declared large-scale consolidation “a low probability” at the IATA 82nd AGM in Rio de Janeiro, pivoting instead to targeted acquisitions of airport slots, gates, and distressed airline assets.
- The failed United-American merger — which would have created a carrier with just over 34% U.S. market share — collapsed after American’s management publicly opposed it and President Trump rejected it in April 2026.
- United has already executed on its asset-acquisition strategy, purchasing two Spirit Airlines gates at Chicago O’Hare for approximately $30.2 million in February 2026.
- A surging fuel crisis has created a structural divide in U.S. aviation: brand-loyal carriers such as United and Delta are absorbing cost pressure through higher fares, while price-dependent rivals face growing financial strain.
- Delta President Peter Carter also ruled out M&A at IATA, with both major carriers signaling that international expansion — particularly trans-Pacific routes — rather than domestic consolidation, is the next competitive frontier.