Another US red flag?

[700UW]

The operating certificate has been one for years, there is one maintenance program, and the fleets are combined, the only thing is due to the two distinct flight crews, because of they dont have a merged CBA that east crews fly east planes and west crews fly west planes.

Mechanics, customer service and fleet all work both west and east flights and planes.

 

[Bob Owens]

Well stated, skynews. A very rational and realistic response. I think the most important aspect of a merger will be the size of the combined companies. AA has no chance of future survival and growth all by itself. What's needed is a larger airline with a larger network to even begin competing with United and Delta. AA simply cannot survive on its own by taking back market share through internal growth alone. That would take too long, if it happens at all. The only possible way AA could be successful on its own is to actually scale down our network and become a 'niche' airline and focus on being "the" carrier to Central and South America (where we're already strong.) But that's not the vision of our executives. If we want to be a truly global airline, we need to immediatly latch on to US and be part of a larger global network. There's no time to waste. Integration and union issues will eventually be resolved in the meantime.

Compete at what? Southwest and Jet Blue are both smaller yet they both consistantly earn profits.

I'd rather get good wages than see AA "truly" become a Global Airline. Do you really want to see AA become a Goliath with rock bottom wages?

 

[AAviator]

Bob, Juniority seems to be in a panic over this. "there's no time to waste"

I doubt he/she really gets what is going on here...

 

[WorldTraveler]

very good summary Aviation, but DL didn't gain anything in Latin America from Pan Am. As part of the original deal w/ Pan Am, DL invested in the reorganized Pan Am - in return for 25% IIRC, which was to focus on Latin America but there were exit clauses that limited DL's exposure. Pan Am's losses far exceeded what their business plan showed and the DL acquisitions of the Atlantic assets generated far more losses than DL imagined.
DL pulled out as allowed - it has been to court and the ruling was in DL's favor.
DL had already started ATL-Latin America which they continued to build and have added a few JFK-Latin America routes along w/ a few from LAX but LAX has largely been pulled back.
DL's most recent strategy is to buy equity stakes in AeroMexico and Gol (Brazil) to allow them to sit on the boards of those companies and influence decisions in DL's favor since the US does not have Open Skies with either Mexico or Brazil; the US government does not allow joint ventures, revenue sharing, or antitrust immunity between carriers where Open Skies does not exist.

As for MIA, AA already had a headstart as a result of buying Eastern's Latin America assets- which were acquired from Braniff not too many years before. UA bid on and won the firesale in the wake of Pan Am's collapse but it did not take too long before AA ran UA out of town, only to dominate MIA which is the way it has remained ever since.
UA's merger with CO was driven in part because CO had a strong franchise to Latin America with a greater focus on central America which did complement UA's presence in deep S. America which was about all they had kept.

Your point still remains valid that AA/US would not be #1 or #2 across the Atlantic or Pacific (DL is #1 across the Atlantic and 2 across the Pacific, and just the opposite for UA); Latin America is a profitable region but it is also protected and thus merging on the basis of current strength which will most certainly change in the next few years as other carriers are given rights to expand is iffy at best.
While many tout that AA/US would be #1 domestically, no one has factored in the continuing changes in the domestic market including NYC as well as the fact that at least one large AA/US hub will be redundant - probably PHX - with the likely result that AA/US would not be #1 domestically and might fall to #3, esp. given that UA is rebuilding DEN as it becomes more and more likely that F9 will fold up or shrink to a size that they no longer matter.

Bob's point is valid... but airlines are network businesses. The reason why WN has thrived is because they focus on a model which is different from the network carriers, with whom they try to avoid direct competition. They either move in to take over a market from a network carrier or they don't mess with it. DEN may be one of the few examples where they end up coexisting on a large scale at the same airport as a network carrier. Just today, WN announced they are pulling down more ATL flying after deciding earlier this year they will not go head to head against US in many PHL markets.

WN will protect its ability to generate good revenues - which is at the root of being able to pay good salaries - by operating in a niche left by other network carriers and largely avoiding direct competition unless it is absolutely necessary to do so and they have a good track record of surviving alongside that network carrier.

 

[signals]

Everything is integrated except the FA and Pilots.

Basically the ones who run the show.

 

[LD3]

Basically the ones who run the show.

Bingo

 

[700UW]

[sup]Yep they sure run the show, how has that worked out for them the past seven years?[/sup]

[sup]Both fleet and mechanics got raises, improvements and pilots and fas have gotten nothing.[/sup]

[sup]Both M&R and Fleet are in Section 6 negotiations for the second post chapter 11 cba and the AFA and USAPA negotiations are parked.[/sup]

 

[signals]

My comment was to that fact, that the real frontlines are being put on the sidelines.

I'm not saying that it is right. Just my opinion, but if there is no merger, Parker will make a union-free US by 2018 at the latest.

 

[700UW]

Explain how Parker will do that?

 

[signals]

Tell you what, when you reach the 10 year merger mark we'll talk.

Whether you admit it or not, the old adage Divide and Conquer works. It's one thing to divide the pawns, but when you separate the King and Queen, check mate is just around the corner. If USAPA were to strike, would there be members who cross the picket line?

 

[Bob Owens]

Tell you what, when you reach the 10 year merger mark we'll talk.

Whether you admit it or not, the old adage Divide and Conquer works. It's one thing to divide the pawns, but when you separate the King and Queen, check mate is just around the corner. If USAPA were to strike, would there be members who cross the picket line?

One has to wonder when you have workers that have given away so much, with the encouragement of their Unions, why would you expect that they would honor a picket line and help someone else fight?

The Unions in this industry have done such a good job taking the fight out of the workers by telling them to agree to the unacceptable why would they think they could get them to honor another unions pickets when they wont fight for themselves? USAIRWAYS, like AA, pays less than Non-union Jet Blue, Delta and Fed Ex. What value do these members get from their dues when better deals are available without a union?

I think Signals makes a good point, if the union can only bring back inferior deals why keep them? USAIR keeps AA company at the bottom of the industry. $600 a year for what?

Right now Unions are blaming everything on the BK process, Ok, what are they doing about it? What are airline unions doing about the fact that AIRLINE Union workers are the only people in this country that are forced to continue to provide services to a private enterprise under terms they never agreed to? rail workers are protected under 1167, all other workers fall under the NLRA where they can strike if they abrogate, all other creditors can withdraw their services or products. Only airline Unions are prohibited from withdrawing what they provide absent an agreement. So what are Unions doing to stop USAIR from riding out the Sect 6 process, essentially forcing a pay freeze, and then filing for BK again? If the AFA does strike, what's stopping USAIR from filing BK to stop the strike? Whats stopping the whole industry from doing the same? Nothing, and we should expect more than that from our unions.

After Obama was elected in 2008 Unions in this industry were more concerned about making it easier to get into a union than making membership more advantageous for members. They spent all their political capital to change the rules for getting a union, despite the fact that under the preexisting rules this was already the most heavily unionised industry out there. In the meantime the Non-union workers they hoped to organize were better compensated than their unionized peers.



“One has a moral responsibility to disobey unjust laws.”

― Martin Luther King Jr.

Mark Richard, a "Union" lawyer actually mocked me for using such quotes, of course he was paid to make sure the deal passes. Unfortunately for me I guess, I actually believe in such things. An ethical Lawyer would cite how these rules violate everything the law is supposed to stand for in this country.


How can a law be considered "just" when it only applies to us with no regard to our rights? It wasnt written this way, its the way indiviual judges have spun it that has made it what its become, and our Unions stay silent.

 

[WorldTraveler]

well said, Bob.
It is worth noting that all network/legacy airlines have now been in BK and all except for AA have been out for at least five years... BK may have been responsible for huge cuts to pay and benefits but it can no longer be used as an excuse for failing to improve compensation since emergence.

 

[Bob Owens]

well said, Bob.
It is worth noting that all network/legacy airlines have now been in BK and all except for AA have been out for at least five years... BK may have been responsible for huge cuts to pay and benefits but it can no longer be used as an excuse for failing to improve compensation since emergence.

Thanks but you missed my point.

 

[WorldTraveler]

no, I get your point. It is precisely the environment that some carriers have created w/ labor that has made it impossible for their employees to recoup what has been lost.

All carriers work under the same laws.... the results have been very different for each airline group.

 

[AAviator]

Yes it is about performance. How do DL and UA do it with the size they are. US performance metrics are among the best and much much better than AAs on any given day.

With that said, US has to perform up to employee standards and is currently lagging a bit in that regard. But the notion that US must be married to AA in order to survive is hogwash. It is AA that needs US worse than US needs AA.

What will be most interesting to watch is how AA will do everything they have promised without market share and revenue capability.

And you PITbull know this better than most. If it can't be done, then all the promises to labor in the world will not keep the BK wolf away from the door. A smaller AA will not do as well against UA and DL.

And if US is acquired or otherwise then who will benefit from the 14 billion in annual revenues. Certainly not a standalone AA. Talk is cheap.

Back at ya..

How does LCC make AA competitive where it is most lacking.. NYC/Pacific.. AA/LCC will be the largest...with ---by far--- the weakest route structure. Where is the Pacific market share and revenue gonna come from?

???

Should I lump you into the the "lets just merge and we'll figure it out later" group? (I already did)

You might have missed AA's announcement of new DFW/Seoul service.. And the dozen or so 777-3's on the way.. We're training 12 new 777 crews/month going forward..

Pilot recalls have begun, 40/month starting in Jan. The new A319 sim has been installed with another one on the way very soon.

Post BK, AA's costs will be more than 1 billion/yr. lower than before the filing.

How can you say AA is headed back to BK post emergence?


Juniority, go back a page or two.. I'm hoping you will respond to my reply to your post. wings396 didn't reply to my reply to him in post 43 so i'm not expecting anything with substance from him..

ChockJockey or any of the other rabid merger fans care to join in?

Happy Thanksgiving everyone!