Blog

What Will Creation Of The World’s Largest Airline Mean For Sponsorship?

By Jessica Parr Dec 17, 2013

What Will Creation Of The World’s Largest Airline Mean For Sponsorship?

There has been a lot of conversation about American Airlines and US Airways creating the world’s largest airline and the impending merger’s impact on consumers’ wallets. But equally as relevant to our industry, how will it impact current sponsorships—in particular US Airways sponsorships in its hub cities and especially in the Phoenix market, the current home of US Airways headquarters?

Airlines are big sponsors in their hub and home markets, but with the merged entity headquartered in Dallas-Fort Worth, the carrier’s future sponsorship presence in Arizona is unknown. Based in Tempe since its 2005 merger with America West Airlines, US Airways has had a large presence in the community. Relationships include the Arizona Diamondbacks, Arizona Cardinals, Phoenix Coyotes, Arizona State University and the airlines’ largest deal: naming rights sponsor of the Phoenix Suns arena, which it inherited from America West.

It is not clear yet what will happen to the name of US Airways Center or any of the airline’s other deals in the Phoenix area. The same is true for its sponsorships in its Charlotte and Philadelphia hubs.

As part of the settlement with the U.S. Department of Justice allowing the merger to proceed, US Airways and American Airlines committed to maintaining operations at hubs in those three markets, as well as New York, Los Angeles, Miami and Chicago for three years. All bets are off at the end of that period, and there has been speculation that Phoenix is likely to lose its hub role given its proximity to LA and DFW.

If that happens, expect many of the deals listed above to go away as well. With the category open, it will be interesting to see what other carriers decide to do. In particular, will Southwest Airlines—an official sponsor of the Suns despite having a competitor’s name on the team’s home venue—consider taking over the arena naming rights?

The new American Airlines will not be lacking for sponsorships, of course. In addition to its legacy naming rights deals in Miami (American Airlines Arena for $42 million over 20 years) and Dallas (American Airlines Center for $195 million over 30 years), it also has marketing and sponsorship deals with the Dallas Cowboys, New England Patriots, University of Southern California and Major League Soccer, among other rightsholders.

More:

sports sponsorship strategy

 
 
Jessica_Parr_bw

About the Author

Jessica specializes in valuation and custom research. Since joining ESP Properties, she has helped properties and their partners make sense of the sponsorship landscape, and competitive activity in their categories and segments, through targeted research and valuation analysis.

Comments

Be the first to leave a comment.

Please login to post a comment.

Sponsorship Report

Subscribe today for unlimited access. Learn more