The airline industry has been consolidating globally, with three huge U.S. airlines emerging from six (not to mention two discount carriers merging into one), while a number of smaller European airlines have been gobbled up by the big players like Lufthansa, Air France and British Air. Even Australia’s airlines are consolidating and partnering. Tiger Air was recently acquired by Virgin Australia, while partnerships with Middle Eastern and Asian carriers boost traffic and revenue. And global alliances bind the airlines into confederacies that benefit them with market share and other synergies.
Meanwhile, the global car rental industry has consolidated too. Enterprise acquired Alamo and National, Avis acquired Budget and ZipCar and Hertz bought Dollar and Thrifty.
The consolidation also involves drug stores. Walgreens (31% market share) is buying its rival Rite Aid (10% market share) combining the second and third largest pharmacies to challenge the massive CVS Health (58% market share). Seeking larger market share and greater market control as well as negotiating leverage and operational synergies, the two companies are merging during a time when there is a tectonic shift in the health care industry.
Walgreens is already somewhat globalized through an alliance with Boots, a British pharmaceutical firm. The merger will enhance that relationship. Plus consolidation will give the new merged company more leverage in negotiations with drug companies as well as against competitors in the market, which include Costco, Target, Wal-Mart and other big-box retailers. Incidentally, Target’s pharmacy business was acquired by CVS this year and will convert its more than 1660 locations into CVS pharmacies, creating a confederation that will certainly increase its market share and corporate strength.
Emphasizing the global nature of the merger Stafano Pessina, Walgreens Boots Alliance’s CEO said, “another step in Walgreens Boots Alliance’s global development and continues our profitable growth strategy. In both mature and newer markets across the world, our approach is to advance and broaden the delivery of retail health, well-being and beauty products and services.”
The deal “will enhance our store base and expand opportunities as part of the first global pharmacy-led, health and wellbeing enterprise,” added John Standley, Rite Aid CEO.
Even the Internet is dominated by only five companies who command more than 70% of online revenue. They are Amazon, Alphabet, Ebay, Facebook and Liberty Interactive. And they just keep getting bigger while many smaller Internet firms decline and even fade away. Investors have realized that if they want a share of the largest, they must stick with the big companies, which strengthens them even more.
The auto manufacturing industry is also quite consolidated as well. Ford and General motors haul in two-thirds of U.S. car sales, for instance. Meanwhile, Kraft and Heinz merged this year to become a huge global food production behemoth.
These deals are only a few of the many consolidations and confederations in recent decades, which involve banking and finance companies, fast food chains, aircraft manufacturers and others. Mergers of huge companies with one another places greater assets and market share and economic interests into the hands of fewer people and tends toward globalization of commercial interests.
Globalization of business, commerce and trade is prophetically significant. Consolidation and globalization of key businesses is essential for globalization of the economy. The globalization of the economy is essential to globalization of government. Globalization of government is essential to globalization of religion. The Bible explains that the merchants of the earth collaborate with Rome. According to Revelation 18:3, the “merchants of the earth are waxed rich through the abundance of her delicacies.”
“The world is a theater; the actors, its inhabitants, are preparing to act their part in the last great drama. With the great masses of mankind, there is no unity, except as men confederate to accomplish their selfish purposes. God is looking on. His purposes in regard to His rebellious subjects will be fulfilled. The world has not been given into the hands of men, though God is permitting the elements of confusion and disorder to bear sway for a season. A power from beneath is working to bring about the last great scenes in the drama–Satan coming as Christ, and working with all deceivableness of unrighteousness in those who are binding themselves together in secret societies. Those who are yielding to the passion for confederation are working out the plans of the enemy. The cause will be followed by the effect.” Testimonies for the Church, Vol. 8, pages 27, 28.
The social consequences of consolidation and globalization are explained in the following statement.
“Everywhere there is a tendency to substitute the work of organizations for individual effort. Human wisdom tends to consolidation, to centralization, to the building up of great churches and institutions. Multitudes leave to institutions and organizations the work of benevolence; they excuse themselves from contact with the world, and their hearts grow cold. They become self-absorbed and unimpressible. Love for God and man dies out of the soul. Christ commits to His followers an individual work,–a work that cannot be done by proxy. Ministry to the sick and the poor, the giving of the gospel to the lost, is not to be left to committees or organized charities. Individual responsibility, individual effort, personal sacrifice, is the requirement of the gospel.” The Ministry of Healing, page 147.
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