American Airlines and US Airways formally announced plans Thursday to merge in a deal that would create the world's largest air carrier.
The combined carrier will take the name American Airlines since the brand has broader appeal around the U.S. and internationally.
The deal comes after several turbulent years marked by bankruptcy protection filings and consolidation in the U.S. airline industry.
"I think the industry is pretty much done with consolidation," said Doug Parker, CEO of US Airways, who will become CEO of the new American. "We now have a rational but competitive airline industry," he said in a interview on CNBC's "Squawk Box."
American has been restructuring under bankruptcy protection since late 2011. The merger is pending approval by the U.S. Bankruptcy Court for the Southern District of New York.
"We see no issue whatsoever with regulatory concerns," Parker said.
The deal will make the new American Airlines "more financially capable," said Thomas Horton, AMR's chairman and CEO who will become chairman of the combined airline through its first annual meeting of shareholders. After that, the chairmanship also will be assumed by Parker.
The companies said the deal is expected to be completed in the third quarter.
Under the terms of the deal, stakeholders of AMR, parent of American Airlines, will own 72 percent of the combined company, while US Airways shareholders will own 28 percent. The deal has the implied combined equity value of $11 billion.
Parker told CNBC this makes sense since "the two airlines only have overlap on 12 routes." This deal is "good for customers," he said.
For now, passengers can continue to book travel as well as track and manage flights and frequent-flier activity through AA.com or USAirways.com.
"We'll [eventually] be combining the miles from the two frequent-flier programs," Parker said.
But at this point, there are no changes and all miles on either airline will continue to be honored.
—The Associated Press also contributed to this report.