Horizontal integration occurs when there is a merger between two firms in the same industry operating at the same stage of production. For example two firms both producing products in the primary sector merging that would be an example of this type of integration. This enables firms to benefit from economies of scale and build up a more efficient distribution network. A real life example was in 2013 when US Airways merged with American Airlines to benefit from managerial economies of scale to raise efficiency and productivity, as well as increasing the level of market power for the newly merged firm.