AA - SWA ?

[Duke787]

How strong would a AA and SWA merger be. After AA comes out BK, there will no longer be legacy airlines, just a lot of low cost airlines. I know SWA have a different route structure system then AA, but I'm sure the schedules could be tweaked to make it work. The one thing that might be hard to understand at first will be for the corporate culture, AA likes to piss off the employees by delaying contracts for years while SWA likes to make their employees the highest paid.

 

[787nightmare]

"How strong would a AA and SWA merger be..."

🙂-D That'd be the day!....

 

[FWAAA]

Unless Horton fails to cut costs in bankruptcy, WN will have the highest labor rates once AA is done. Although WN did just buy a low-wage airline (FL), that was small potatoes compared to AMR. Now if WN cuts its labor costs, that would be a different story . . .

 

[swamt]

Unless Horton fails to cut costs in bankruptcy, WN will have the highest labor costs once AA is done. Although WN did just buy a low-wage airline (FL), that was small potatoes compared to AMR. Now if WN cuts its labor costs, that would be a different story . . .

Never say never. Could this be why SWA is in such a hurry to get this integration done? Is it why AA is taking it's time to start working on cutting the labor cost? Personally, I don't think so. Regulators won't allow the DAL/AA to happend. I think (just a prediction here) it will be AA/US and maybe even a 3-some with JB. Or I could see AA/JB, and everyone watches US just slowly wither away to non-existance. BUT, here's another thought, both the headquarters of AA and SWA are right here in the DFW area, how easy and inexpensive it would be to merge the headquarters together. They would save millions upon millions from no severance packages do to employees not having to refuse employment from not being able to move if like DAL/AA merged.
Just a thought, Hmmmmmm...

 

[BoeingBoy]

I think that the only thing less likely than a DL/AA merger is a WN/AA merger. The business models are so different that the combination would either become one or the other - low cost p2p single plane type (after the FL 717's are gone) which means discarding a lot of AA, or low cost for a network carrier with fairly extensive international service. Trying to bring AA employees up to WN pay scales eliminates the low cost network carrier and trying to bring WN employees down to AA's pay scales pizzes off the WN employees.

Here's my handicapping based on who's looking at deals today from least likely to most likely:

1 - DL/AA - almost no chance - either too many regulatory hurdles or DL just wants parts of AA and sells off the rest
2 - US/AA - a 1% better chance than DL/AA - not as many regulatory hurdles but but a case of 1+1=1.1
3 - TPG/AA - quite possible - call it a 30% chance
4 - AA stand-alone - entirely possible - call it a 70% chance

Jim

 

[AAviator]

I think that the only thing less likely than a DL/AA merger is a WN/AA merger. The business models are so different that the combination would either become one or the other - low cost p2p single plane type (after the FL 717's are gone) which means discarding a lot of AA, or low cost for a network carrier with fairly extensive international service. Trying to bring AA employees up to WN pay scales eliminates the low cost network carrier and trying to bring WN employees down to AA's pay scales pizzes off the WN employees.

Here's my handicapping based on who's looking at deals today from least likely to most likely:

1 - DL/AA - almost no chance - either too many regulatory hurdles or DL just wants parts of AA and sells off the rest
2 - US/AA - a 1% better chance than DL/AA - not as many regulatory hurdles but but a case of 1+1=1.1
3 - TPG/AA - quite possible - call it a 30% chance
4 - AA stand-alone - entirely possible - call it a 70% chance

Jim

I have to agree with this..

The TPG package may very well involve IAG.

Nothing but silence from across the pond, and AA is the critical component to OneWorld at the moment.

 

[tom barry]

I think that the only thing less likely than a DL/AA merger is a WN/AA merger. The business models are so different that the combination would either become one or the other - low cost p2p single plane type (after the FL 717's are gone) which means discarding a lot of AA, or low cost for a network carrier with fairly extensive international service. Trying to bring AA employees up to WN pay scales eliminates the low cost network carrier and trying to bring WN employees down to AA's pay scales pizzes off the WN employees.

Here's my handicapping based on who's looking at deals today from least likely to most likely:

1 - DL/AA - almost no chance - either too many regulatory hurdles or DL just wants parts of AA and sells off the rest
2 - US/AA - a 1% better chance than DL/AA - not as many regulatory hurdles but but a case of 1+1=1.1
3 - TPG/AA - quite possible - call it a 30% chance
4 - AA stand-alone - entirely possible - call it a 70% chance

Jim

And AA/B6 Jim ?

 

[FWAAA]

Southwest just paid about $1.4 billion for some Atlanta real estate, slots at DCA and LGA plus some customers (FL). Might not be the worst acquisition of all time to pay a billion dollars for some NYC and BOS real estate and customers (B6).

 

[jimntx]

Why would anyone want to mess up a perfectly good, profitable airline like Southwest with the mess we have become? Talk about culture shock! We AA f/as would never survive having to clean the plane after every leg. After all we still have f/as who will tell you, "We used to have people that cleaned the galleys and the cabin. We NEVER had to clean either." (My response: Yeah, honey. And, they used to run this route with a wagon train, but you know, times change.)

 

[BoeingBoy]

And AA/B6 Jim ?

Interesting speculation but personally I see that as having only a little better chance than AA/DL or AA/US and a lot less chance than AA coming out of bankruptcy as a stand-alone carrier. There would be some regulatory problems, primarily from the combined market share in JFK, but not nearly as bad as AA/DL. To me, merging with B6 would be mostly about getting rid of a low cost competitor and $4 to $5 billion is a hefty price to pay for that - especially when other carriers would also benefit from B6 going away but have none of the cost of making it happen.

Jim

 

[Frank Szabo]

A SW/AA combination might be a good thing for employees of both on the surface but, as others have commented, would be an untenable combination/outright clash of management cultures. The free-for-all would be fun to watch, though.

An off topic aside - if one insists on having a cell phone, insure its security - DO NOT leave it unattended as a scumbag can steal the card from it and, in effect, become your online identity if the phone/card retains site identifications and such - ie, a Smartphone with net access.

 

[AANOTOK]

http://startelegram.typepad.com/sky_talk/

On whether Southwest may be interested in some of American Airlines' assets while the Fort Worth carrier is in bankruptcy: Kelly said, "I would fully admit and certainly wouldn’t want to be cute about this, a hub and spoke airline and with multiple aircraft...It is not obvious how that would fit for an airline like Southwest Airlines. What we would clearly do is we will pay close attention to anything that does become available whether it is a simple route or other assets. And we will be on our toes to move on those."

On how American's network overlap with Southwest's: "There is a lot of overlap in Dallas and a lot of overlap in Chicago even though it's not the same airports. We have a lot of overlap with them in California....There is plenty of overlap and there are plenty of opportunities to gain some share if they shrink," Kelly said. Wright added that there is a 35 percent network overlap between the two carriers.

 

[AAviator]

And AA/B6 Jim ?

I include that with the TPG/IAG option. Probably the most compelling combination. Probably the least expensive as well.

 

[damajagua]

Interesting speculation but personally I see that as having only a little better chance than AA/DL or AA/US and a lot less chance than AA coming out of bankruptcy as a stand-alone carrier. There would be some regulatory problems, primarily from the combined market share in JFK, but not nearly as bad as AA/DL. To me, merging with B6 would be mostly about getting rid of a low cost competitor and $4 to $5 billion is a hefty price to pay for that - especially when other carriers would also benefit from B6 going away but have none of the cost of making it happen.

Jim

Agree

 

[Buck]

Come on all of you are grownups. An AA/WN merger would mean that the mechanic wages at WN would be brought down to AA mechanic wages, AMFA would get kicked off the propety and God help AirTran and TWA mechanics, as the TWU takes over.