Mergers and acquisitions in aviation – Management perspectives and econometric evidence on the size of airlines

摘要

Mergers and acquisitions are often seen as a very effective way of surviving in the currently very competitiveenvironments of many aviation markets. Airlines merge or acquire each other for a number of reasons. First,home markets are maturing and expansion abroad is usually restricted by Air Services Agreements. Often therationale is simply to get access/slots to key airports, in other cases airlines hope to leverage synergies and toextend their networks. This paper is particularly concerned with the growth that many airlines see as mandatoryto survive in aviation markets. While it may make sense to grow and benefit from economies of scale, which iseasiest and fastest through mergers and acquisitions, at some point airlines may become too large to produceefficiently. This paper applies a DEA efficiency analysis to 66 international airlines to evaluate whether big isalways beautiful, and if not at what point it would make sense from a scale efficiency point of view to not growany further. While our main DEA models focus on physical variables, in some of our models we account fortotal revenue as an output and we also show the impacts of firm size on revenue and profitability variables.