Senior lawmaker to fight air mergers

By John Crawley

WASHINGTON (Reuters) - A senior House of Representatives Democrat influential on aviation matters said on Wednesday he plans to build a strong case against airline mergers if one or more consolidation proposals materializes.

Rep. James Oberstar of Minnesota, chairman of the Transportation Committee, also told the Reuters Regulation Summit here that he is preparing to give regulators and antitrust officials the "long view" on congressional concerns and what a series of mergers could do to service, fares and consumer choice.

"I am concerned the (Transportation Department) will not raise its voice here and they should. And for the Justice Department, I think we have to give them the longer view while they consider (one) proposal," Oberstar said.

Oberstar previously confirmed Minnesota-based Northwest Airlines (NWA.N: Quote, Profile, Research, Stock Buzz) was in talks with Delta Air Lines (DAL.N: Quote, Profile, Research, Stock Buzz), but said that he had no information on the progress of those discussions.

Industry experts have suggested the two may be nearing a deal and the Wall Street Journal reported late on Wednesday a proposal could be made as early as next week. The Journal also said that preliminary talks between United Airlines (UAUA.O: Quote, Profile, Research, Stock Buzz) and Continental Airlines (CAL.N: Quote, Profile, Research, Stock Buzz) have grown more serious.

Oberstar is convinced that if Delta and Northwest move forward, others will follow.

"If we allow the creation of a global mega-carrier, the others cannot stand still to defend their market share, to defend their market interests. They too will have to undertake merger talks and ventures," Oberstar said.

Only the Justice Department can block a merger over competition concerns, but Congress can pressure antitrust officials, regulators and the companies themselves if lawmakers do not favor a deal. Congress did just that in 2001 when United's bid for US Airways (LCC.N: Quote, Profile, Research, Stock Buzz) fell through and last year when Delta fended off a hostile attempt by US Airways.  Continued...