Airline stocks down sharply - DOJ reportedly to block AMR/LCC

[robbedagain]

I do not recall UA/CO DL/NW and FL/WN giving up slots to get there mergers thru and should ua/co been allowed to merge given their size yet they block US/AA but they allowed DL/NW and their the largest in the world sounds to me the doj is playing double standards here regardless of what those clowns say in dc

 

[700UW]

CO/UA leased some slots to WN at EWR.

 

[robbedagain]

sorry about that 700 i forgot they leased it thats differnt that giving up slots isnt?

 

[FWAAA]

CO/UA leased some slots to WN at EWR.

sorry about that 700 i forgot they leased it thats differnt that giving up slots isnt?

No, it's not different. UA/CO permanently transferred the slots to WN. Here's an excerpt from the DoJ press release:

The transfer of slots and other assets at Newark to Southwest, a low cost carrier that currently has only limited service in the New York metropolitan area and no Newark service, resolves the department’s principal competition concerns and will likely significantly benefit consumers on overlap routes as well as on many other routes. The slot transfer is through a lease that permanently conveys to Southwest all of Continental’s rights in the assets, in compliance with FAA rules.

http://www.justice.gov/opa/pr/2010/August/10-at-974.html

See the bolded part? Permanently conveyed.

As to your earlier question - there is no antitrust rule that permits everybody one free merger, regardless of the competitve impact. The DoJ clearly indicated in the complaint that this proposed merger would substantially lessen competition in violation of the Clayton Act. This proposed merger results in just three legacy network airlines while the prior mergers left five and then four legacy network airlines in place.

You've read the complaint, right? Including the outrageous statements and conduct by Parker, right? If not, you really should read the complaint.

 

[nycbusdriver]

Remember that Parker's plan was to cut capacity in the SE if the DL merger had gone through and legislators jumped all over that. You just can't say some things and then expect the gov't to bless your efforts.

I am loathe to defend Parker, but his position has been between a rock and a hard place.

Sure he said he would cut capacity in that failed merger attempt with DL, but he had to sell his POR to the creditors.

He is stuck talking out both sides of his mouth by marketing his scheme to the creditors committee, but reassuring the government, the press and the traveling public that not only will there be more seats available at cheaper prices, but every airport will have hourly, non-stop service to every other airport on the planet using Boeing 747s only.

And free internet, too.

 

[nycbusdriver]

If it has not already been assigned, we should wait to see if the case gets before a Democrat- or Republican-appointed judge, and then see that judge's record.

As much as judges think they're impartial, often the outcome can be determined by knowing who hears the case.

(But I'm not cynical!)

 

[UPNAWAY]

[sub]The DOJ complaint reads more like a personal vendeta and weird atatck on any business trying to make a profit. I cannot help but think sinster forces are at play. Maybe Holder has a good friend at United who said something?[/sub]

 

[cltrat]

[sub]The DOJ complaint reads more like a personal vendeta and weird atatck on any business trying to make a profit. I cannot help but think sinster forces are at play. Maybe Holder has a good friend at United who said something?[/sub]

don't kid yourself politics plays a hand in anything that goes on in Washington

 

[FWAAA]

If it has not already been assigned, we should wait to see if the case gets before a Democrat- or Republican-appointed judge, and then see that judge's record.

As much as judges think they're impartial, often the outcome can be determined by knowing who hears the case.

(But I'm not cynical!)

I don't put much stock in the background of US District Court judges, but she was appointed in 1997 by Clinton. Here's her bio:

http://aviationblog.dallasnews.com/2013/08/antitrust-judge-heard-microsoft-case.html/

[sub]The DOJ complaint reads more like a personal vendeta and weird atatck on any business trying to make a profit. I cannot help but think sinster forces are at play. Maybe Holder has a good friend at United who said something?[/sub]

Given the plethora of false information you've posted (especially today in multiple posts), I have to wonder what forces are at play behind your posts.

 

[jimntx]

The Justice Department filed the case in U.S. District Court for the District of Columbia with states of Arizona, Florida, Pennsylvania, Tennessee, Texas and the District of Columbia.

http://www.usatoday....irways/2647545/

It's interesting that with the exception of DC, the states joining the suit are all pro-Republican, anti-Obama states. (I know that PA sometimes votes Democratic, but they are not a sure thing ever.) I'm particularly shocked by the actions of my state, Texas, considering all the public posturing by The Coiffure (aka Gov. Perry) that the government needs to get out of the way of all businesses and let everyone do whatever they need to do to succeed--legal, fair, ethical, or not.

 

[jimntx]

Perhaps Parker and the DoJ will announce a compromise by which AA gives up lots of LHR slots, lots of LGA and DCA slots and gates, some gates at PHL and CLT, subsidizes new-entrant competitors at DFW and MIA and gives up a large portion of its LAX operation in exchange for approval. As others have said, I hope that doesn't happen, as that would severely hamstring AA's chances going forward.

I suspect you are being facetious because you have listed as candidates for divestiture the very things that make AA a possibly viable company even today, more so in the future. The LHR slots are like gold, the hold on MIA funds a large portion of the rest of the operation, and I don't think anyone in their right mind even wants to take on AA at DFW. Such concessions would make the merger a financial waste of time.

People have got to realize and accept that there are other issues more important than the friggin' DCA slots. As for management on both sides of the aisle...let's hope they remember the old adage that "when you find yourself in a hole, the first thing is to stop digging."

 

[AirbusA310]

Airlines should just be subsidized by the government and charge fares that the government sets, and fly to where the government tells them to fly and and .. oh wait are we in the USA or 1970's 1980's USSR??? maybe the DOJ would allow a US Airway Air China or US Airways Aeroflot merger....
so much for deregulation let airlines merge and do as the want...there are still lots of options for air travel and there always will be more than one choice for air travel

 

[FWAAA]

I was exaggerating, but my point is that sometimes execs get so blinded by the "gotta do the deal no matter what" mindset that they might agree to give up what amounts to the crown jewels - as you pointed out.

I don't think the DoJ would approve of the merger even if US and AA give up more slots at DCA than AA currently holds, but I've been wrong before. I read the complaint as "game over." As in "merger ain't gonna happen, without very significant concessions that would hobble the ability of new AA to compete against UA or DL." I think Parker's dream died yesterday. The APA and APFA put on a brave face on Tuesday, but privately, if their lawyers are shooting straight with them, they've gotta be very disappointed. Horton and other AA managers who were gonna be out of a job are probably very happy. They didn't want the merger (at least not on Parker's terms) and now the DoJ has thrown up a big roadblock that helps them.

 

[Dog Wonder]

[sub]The DOJ complaint reads more like a personal vendeta and weird atatck on any business trying to make a profit. I cannot help but think sinster forces are at play. Maybe Holder has a good friend at United who said something?[/sub]

Communiss!!

 

[USFlyer]

Conference call just held with industry was very telling. Short version, US+AA are ready to fight this and believe, at the end of the day, the merger will proceed. It was also pointed out that AA and US CANNOT effectively compete with DL and UA longer term, so that will likely form a major part of the trial. This is no longer in the hands of the DOJ. It's now up to a judge.