American Airlines and US Airways will challenge a US Department of Justice (DOJ) decision not to allow their planned merger.
The DOJ says customers would be worse off if the deal went ahead, as a merger would result in less competition and price increases.
US Airways chairman and chief executive Doug Parker said, "We are extremely disappointed in this action and believe the DOJ is wrong."
AA and US Airways had intended to merge by the end of the year. The deal has already been approved by the European Union.
US attorney general Eric Holder issued a statement saying: "By challenging this merger, the Department of Justice is saying that the American people deserve better.
"This transaction would result in consumers paying the price – in higher air fares, higher fees and fewer choices."
The DOJ decision was welcomed by the Washington, D.C.-based Business Travel Coalition (BTC). BTC chairman Kevin Mitchell said: "In recent years… the major airlines have, in tandem, raised fares, imposed new and higher fees, and reduced service.
"Competition has diminished and consumers have paid a high price."
By TravelMole UK
