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It's All Up in the Air: M&A Deals in the Airline Industry

Analysts and airline industry executives have stated that merger deals in the airline sector are inevitable. The industry is facing a number of challenges, such as stiff competition and rising operational expenses, particularly the rising cost of jet fuel. Industry consolidation would help airlines face these challenges by combining resources, cutting costs, and reducing competition.

According to an estimate from Jamie Baker, an analyst with JPMorgan Chase, airline industry losses could top $7.2 billion in 2008. Some analysts estimate that airlines will have to raise fares on all routes by about $60 to offset the impact of rising fuel prices, which are up 82.5 percent over last year. But ...

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