Emirates, Etihad Potential Merger Has Many Stumbling Blocks - Bloomberg

Emirates, Etihad Potential Merger Has Many Stumbling Blocks - Bloomberg:

A takeover by Emirates of Etihad Airways PJSC is the megadeal that has to happen in the global airline industry. At the same time, it’s a poisoned chalice for the suitor that may hobble its growth plans for a generation.

The two carriers are in preliminary talks over a deal, people familiar with the matter told Layan Odeh, Dinesh Nair and Benjamin Katz of Bloomberg News on Thursday. Any discussions may be protracted because combining these two airlines will be as difficult and risky as getting hedgehogs to mate.

While countries the size of China and the U.S. have domestic markets large enough to sustain multiple global hub carriers, the United Arab Emirates is a much smaller beast, with a population of just 9.4 million. Trying to establish not one, but two world-connecting airlines there (just down the road from a third global hub airline in Qatar, population 2.6 million) is a bit like trying to do the same thing in Hong Kong or Singapore