Fly the new American Airlines, it won't cost any more...as long as demand doesn't drop.
That was the message from Doug Parker, who became chief executive officer of the world's largest airline on Monday with the merger of U.S. Airways and American Airlines.
"We're keeping all the airplanes, keeping all the people," he said of the merger. "So supply should be unchanged. As long as demand stays the same, nothing should happen to prices."
A US Airways plane passes American Airlines planes at Ronald Reagan National Airport in Washington, April 23, 2012. The airlines officially merged on Monday to form the world's largest air carrier.
The new American, along with United and Delta, will have global strength with access to the main business centers of the world. So airline competition will be based on how good the in-flight experience is for travelers, Parker said on CNBC's "Squawk Box."
"The three of us have now the ability to take people pretty much anywhere in the world. What used to be a business where it was purely on schedule, if you have the ability to take people everywhere, you have to compete on product. And we're prepared to do that," said Parker, who had been the CEO of US Airways before the merger.
The newly combined carrier began trading on Monday under the ticker symbol AAL. The stock was 2.7 percent higher in afternoon trading on the Nasdaq.
With American Airlines coming out of bankruptcy with this merger, Parker said, airlines that aren't profitable won't be able to grow. "We expect to produce a profit that will provide a nice return for our investors. That's what they expect. And that's what we plan to deliver."
The merger of US Airways, formerly the fifth-largest airline, and the old American, formerly the third-largest, creates the world's largest airline as measured by available seat miles—calculated by the number of seats on a plane and how many miles the plane will travel on a certain trip.
More important, the company is now a global giant with a strong domestic and international route network. The new company's modern fleet will give it a competitive edge, Parker said, adding that nothing about this transaction will affect air fares because the carriers are highly complementary.
The U.S. Supreme Court refused to grant a stay on Saturday night that would have stopped the merger. The stay had been requested by a group of consumers and travel agents who said the merger would cause "irreparable" injury to the domestic airlines industry.
The newly combined airline faces a tough Monday because of the ice storm that slammed the Southwest on Friday, bringing the northern part of Texas to a standstill, and leading to massive flight cancellations at the busy Dallas/Fort Worth International Airport.
"It's been an extremely rough weekend for our employees and our customers," Parker acknowledged, noting the bad weather, but said the cost of all the canceled flights won't be "overly material" to the airline's bottom line.
CNBC's Phil LeBeau and Reuters contributed to this article.
First published December 9 2013, 9:48 AM