The announced merger of two of the largest tour bus operators, Iceland Travel and Gray Line, has been met with serious doubt by many in the tourism industry who fear it will create a monopolist with excessive market power. Competitors of the two companies believe the merger will be rejected by the anti-trust authorities.
Read more: Major tourism merger as two of the largest bus companies to join forces
Tour bus operators who spoke to the local newspaper Morgunblaðið expressed concern and incredulity over the merger. Why would they think this merger will be approved, especially when we considering the size of the merged company, one bus company operator told the paper. A major cause of concern is that the new company would likely have a monopoly on service between Keflavík Airport and Reykjavík.
The merger, which is pending approval by the regulatory authorities, is the second major merger in the Icelandic tourism industry. Earlier this year Extreme Iceland and Arctic Adventures, two of the largest tour operators in Iceland, announced a merger. The mergers are a clear sign the tourism industry in Iceland is entering a stage of consolidation and maturity following a period of extremely rapid growth in recent years.
Read more: Two of the largest Icelandic tour operators announce merger
Tougher competition and a stronger Króna have put significant and growing pressure on many businesses in the tourism industry, necessitating the search for greater efficiency and rationalization which can be achieved by consolidation.
The announced merger of two of the largest tour bus operators, Iceland Travel and Gray Line, has been met with serious doubt by many in the tourism industry who fear it will create a monopolist with excessive market power. Competitors of the two companies believe the merger will be rejected by the anti-trust authorities.
Read more: Major tourism merger as two of the largest bus companies to join forces
Tour bus operators who spoke to the local newspaper Morgunblaðið expressed concern and incredulity over the merger. Why would they think this merger will be approved, especially when we considering the size of the merged company, one bus company operator told the paper. A major cause of concern is that the new company would likely have a monopoly on service between Keflavík Airport and Reykjavík.
The merger, which is pending approval by the regulatory authorities, is the second major merger in the Icelandic tourism industry. Earlier this year Extreme Iceland and Arctic Adventures, two of the largest tour operators in Iceland, announced a merger. The mergers are a clear sign the tourism industry in Iceland is entering a stage of consolidation and maturity following a period of extremely rapid growth in recent years.
Read more: Two of the largest Icelandic tour operators announce merger
Tougher competition and a stronger Króna have put significant and growing pressure on many businesses in the tourism industry, necessitating the search for greater efficiency and rationalization which can be achieved by consolidation.
