Back when dinosaurs roamed and the U.S. was deregulating its airline industry, about 30 air carriers accounted for the bulk of the U.S. scheduled passenger airline business.
Sporting a global presence was Pan Am, the iconic pioneer of intercontinental air travel. Domestic markets were dominated by 10 so-called "trunk carriers," many of which traced their roots to the 1920s and '30s. Travel agents in 1978 could rattle them off alphabetically: American, Braniff, Continental, Delta, Eastern, National, Northwest, TWA, United, Western. A dozen or so "local service carriers" operated in regional niches with names like Aloha, Hughes Airwest, Ozark and Piedmont.
At the bottom of the heap were three tiny, intrastate lines that were not federally regulated (PSA and AirCal in California and Southwest in Texas) plus scores of even tinier commuter lines operating very small aircraft.
That was the diverse and decentralized industry of 1978. Some people said deregulation would unleash a "wave of mergers and bankruptcies," scrambling it beyond recognition. Others thought it needed scrambling.
Of course, both sides were right. There were too many airlines, and they have been well and truly scrambled by several waves of consolidation.
In fact, we are down to seven survivors.
If United and Continental succeed in merging, only three of the 10 trunk lines will have survived: American, Delta and United. Only three of the local service airlines still exist: Alaska, Hawaiian and Allegheny (now US Airways).
And the lowly intrastate carrier in Texas, Southwest, has grown to be the largest U.S. airline in terms of domestic enplanements.
That's the seven. The rest are gone, mostly to merger.
It's easy to recount what has been "lost" to consolidation. It's a little harder to figure out what we've gained other than bigger networks. They're certainly no more profitable.
Backers of the United-Continental union say it will reduce excess capacity and lead to increases in efficiency, boosting shareholder value by enabling the airlines to become more profitable.
We've heard that many times before, but something always seems to happen on the way to equilibrium, leading to another cycle of losses and another wave of bankruptcy or consolidation.
Judging from recent history, we don't think seven is going to be the lucky number. But we do think the Airline Survival Kit needs some new tools. Neither bankruptcy nor merger seems to work very well for very long.