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U.S. Airways merger: A strategic variance analysis of changes in post-merger performance

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  • Mudde, Paul A.
  • Sopariwala, Parvez R.

Abstract

This case provides students the opportunity to apply strategic variance analysis (SVA) methodology in analyzing the performance changes realized in an airline merger. The U.S. Airways–America West merger provides an example of a complex, strategic action that simultaneously impacts firm size, unit pricing and costs, efficiency, and capacity for the combining airlines. This merger provides a rich example for the analysis since it combines U.S. Airways, a higher cost network airline that is geographically focused on the Eastern U.S., with America West, a low cost airline operating primarily along the Western U.S. The case includes merger and acquisition (M&A) theory discussing market power vs. efficiency motives for mergers and discusses the role of the U.S. Department of Justice and Federal Trade Commission in evaluating M&As and their impact on markets. The case asks students to serve as consultants applying the SVA methodology to the past U.S. Airways–America West merger and provide conclusions.

Suggested Citation

  • Mudde, Paul A. & Sopariwala, Parvez R., 2014. "U.S. Airways merger: A strategic variance analysis of changes in post-merger performance," Journal of Accounting Education, Elsevier, vol. 32(3), pages 305-322.
    • Handle: RePEc:eee:joaced:v:32:y:2014:i:3:p:305-322
    DOI: 10.1016/j.jaccedu.2014.04.004
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    Cited by:

    1. Khezrimotlagh, Dariush & Kaffash, Sepideh & Zhu, Joe, 2022. "U.S. airline mergers’ performance and productivity change," Journal of Air Transport Management, Elsevier, vol. 102(C).
    2. Le, Huubinh B. & Yimga, Jules O., 2023. "Codeshare restrictions as antitrust remedy," Transport Policy, Elsevier, vol. 138(C), pages 17-24.
    3. Keji Wei & Vikrant Vaze, 2020. "Airline Timetable Development and Fleet Assignment Incorporating Passenger Choice," Transportation Science, INFORMS, vol. 54(1), pages 139-163, January.
    4. Anctil, Regina & Grimm, Stephanie D. & Maloney, Mary M., 2020. "Atlas managerial accounting case: Examining joint products in the international scrap metal recycling industry," Journal of Accounting Education, Elsevier, vol. 51(C).

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