10/6/2009

After the sharp drop in demand for air travel that followed the 2001 terrorist attacks, many airlines were forced to file for bankruptcy or shrink operations. In recent years, carriers responded to soaring fuel prices by adding surcharges and eliminating unprofitable routes from their schedules. Now, in an effort to continue growing, airlines are teamed up with other carriers around the world. "You want to be friends with as many people so they don't crush you or try to buy you," said Philip A. Baggaley, a Standard & Poor's airline analyst. Alliances are "superior to mergers, because you don't go through the costs and upheaval of a merger."

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