Consumers should not fear a major increase in airfares if Southwest Airlines successfully bids for Frontier, analysts said Thursday.
While the proposed deal would reduce competition by consolidating two of the three largest carriers serving Denver, Southwest fares — assuming a consolidation of Frontier's routes — are likely to stay competitive with No. 1 United Airlines.
"Generally when there is less competition, it produces higher fares," said Bijan Vasigh, a professor of air-transport finance at Embry-Riddle Aeronautical University in Daytona Beach, Fla. "But Southwest is not operating by that strategy. Their approach traditionally has been to provide lower fares and greater frequency of service."
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