Since the terrorist attacks on September 11, 2001, the airline industry has suffered a number of setbacks. Initially, the new security regulations and resulting long waits in airports along with a reluctance to fly by many members of the public resulted in a large drop in passengers. The result was excess capacity in the industry. Airlines began to engage in vigorous price competition. A consequence was that many airlines saw a decrease in profits as ticket prices dropped below average costs. By 2005, the industry had gotten smaller and was beginning to recover when Hurricane Katrina struck. The price of oil and jet fuel, which had begun to increase in price because of increased world demand for oil, skyrocketed with the damage to U.S. crude oil production and refining capacity in the Gulf of Mexico and the Gulf states. A consequence was the development of merger talks between airlines. An example was United Airlines and Continental, the number 2 and number 5 biggest airlines, who merged in 2011.

What type of merger occurred between United and Continental Airlines: a horizontal merger or a vertical merger?