United CEO has pitched possible combination with rival American

United Airlines Holdings Inc. Chief Executive Officer Scott Kirby has floated a possible combination with American Airlines Group Inc., according to people familiar with the conversations, an audacious proposition that would face intense scrutiny even under the business-friendly Trump administration. 

Kirby has pitched the idea to senior government officials, though it’s unclear if any overtures have since been made or if an actual process is underway to explore a deal, according to the people, who asked not to be identified because the conversations are private. 

A spokesman for United Airlines declined to comment, as did officials at American Airlines.

United and American are among the top four US carriers, together controlling more than a third of the market. A combination would create the largest airline on the planet. As a result, any merger between the two aviation giants would pose serious antitrust concerns and likely face significant backlash from consumers, politicians and rival US airlines.

At the same time, the deliberations show how recent market upheaval has brought the possibility of consolidation to the fore. Kirby told employees in a memo last month that the carrier would benefit from any shakeout in the industry as part of rising oil and fuel prices, potentially providing purchase opportunities.

“We’ll be there to pick up some of those assets, might be a win-win for them,” Kirby said in a Bloomberg Television March 24 interview in Los Angeles. Asked if that would mean buying entire companies, he said “we’ll see, there’s lots of rumors about that.” 

For Kirby, a deal involving American Airlines would also be personal. Kirby was previously president of American, but left after it was made clear he didn’t have a path to becoming the carrier’s CEO. Kirby joined United as president in 2016 before rising to the top job.

The two companies have engaged in a continuous exchange of strategic one-upmanship, particularly at Chicago’s O’Hare International Airport, where they’ve battled over gate access and market share.

Kirby has also faulted American Airlines for being too late and too slow to add more premium products, which have proven popular and lucrative at United and Delta Air Lines Inc. 

The United CEO’s considerations come as airlines are grappling with higher jet fuel prices due to the US-Iran war and the effective closure of the Strait of Hormuz, a key passageway for oil transports. Kirby has already responded by taking some capacity out of the market, saying he wants to be prepared for potential cost increases. 

US airline mergers have to be reviewed and approved by the Transportation Department, as well as the Department of Justice. Transportation Secretary Sean Duffy said the government would look at a number of factors when considering potential tie-ups, including the impact on competition — both domestically and globally — and ticket prices. 

“President Trump, he loves to see big deals happen,” Duffy told CNBC on April 7. “Is there room for some mergers in the aviation industry? Yeah, I think there is,” he said. 

However, Duffy added that he wouldn’t “pre-commit to anything.”

He also said if there is a merger between two larger airlines, they’ll have to “peel off” some of their assets because the US doesn’t want to see one carrier with too much market share, which could drive up consumer prices.

This story was originally featured on Fortune.com