Chances for the success of the US Airways takeover bid?
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jimntx
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Look at this way, the offer Doug Parker has made to us (the union members of APA and APFA) is certainly better than anything the current management of AMR has been willing to even discuss over the past 3 years. If he is unable to deliver once the merger is completed, we may be screwed. However, if we go with AMR's current management, we are guaranteed to be screwed. Which option would you pick?
If Doug Parker is able to deliver on only half his promises, we will still be better off than with AMR. AND, we will have the pleasure of seeing fools made of the current management who have refused to even discuss some of the ideas the unions have put forth (and DP has agreed to)--insisting that there is no possible way to afford them.
If Doug Parker is able to deliver on only half his promises, we will still be better off than with AMR. AND, we will have the pleasure of seeing fools made of the current management who have refused to even discuss some of the ideas the unions have put forth (and DP has agreed to)--insisting that there is no possible way to afford them.
USA320Pilot
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USA320Pilot
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Cranky Flyer has some great points and insight. Well worth the time to read the comments at the end too.
thanks for the link!
SparrowHawk
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My Crystal Ball is likely on the fritz but I think this thing is all but a done deal.
USA320Pilot
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American Airlines fires opening shot in court battle with workers
Click here to read the story.
CNBC: American's Union Back US Airways Merger
Click here to watch the video.
One of Three AMR Unions Said to Send Offer for Member Vote
The Transport Workers Union of America, representing 26,000 American employees, will allow workers to vote on the proposal, which would cut 8,500 jobs.
As part of the agreement to send AMR's "last, best offer" to members, the company will withhold evidence involving the TWU that it planned to use in the trial this week. That should substantially expedite this week's part," John J. Gallagher, a Paul Hastings lawyer representing American parent AMR Corp.
Click here to read the story.
Click here to read the story.
CNBC: American's Union Back US Airways Merger
Click here to watch the video.
One of Three AMR Unions Said to Send Offer for Member Vote
The Transport Workers Union of America, representing 26,000 American employees, will allow workers to vote on the proposal, which would cut 8,500 jobs.
As part of the agreement to send AMR's "last, best offer" to members, the company will withhold evidence involving the TWU that it planned to use in the trial this week. That should substantially expedite this week's part," John J. Gallagher, a Paul Hastings lawyer representing American parent AMR Corp.
Click here to read the story.
USA320Pilot
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AMR CEO Tom Horton's Letter to AA's Employees: April 23, 2012
Dear American Team:
As you know, US Airways recently revealed its non-binding arrangements with our unions, which is part of an attempt to force a merger with American. While these tactics are not surprising, I'd like to explain what this means – and doesn't mean – for all of us.
First and foremost, nothing changes as a result of these announcements and we will proceed on our path toward a successful restructuring of American. Today we began the section 1113 process and US Airways’ actions are in no way binding on our company or our unions.
I think some perspective on these announcements is useful. It's easy to understand US Airways' sense of urgency to find a way to address the challenges it has faced for a long time. That story is well known.
However, I recognize all of our people have lots of questions about this. First and foremost, everyone should understand that what's best for our company, our people and our financial stakeholders will be determined by the facts in a disciplined manner and process. And this includes whether American will choose to pursue any combination down the road. This is the charge of the board of directors and the leadership team to be done in close collaboration with the creditors committee.
We know our restructuring, like others before, is hard work and the road ahead is challenging. It would be natural to look for an easy way out. But there is no easy path back to renewal and growth and industry leadership. It will require difficult choices. We must be mindful of other parties who don't have our best interests at heart and who are working their own agendas at our expense. There is real substance in our plan to build American with our industry-leading aircraft orders for 460 new narrowbody jets, up to 100 787s and 16 777s. These are planes which should benefit the careers of American pilots and flight attendants. And with this fleet plan, we will grow our network, which is already strong in the right cities and bolstered by the best partners around the world. We have a strong plan that creates lasting benefits for our employees, our customers, our financial stakeholders and our airline.
I want you to know these developments in no way alter our course. We are making significant progress, and the Court has granted us the exclusive right to pursue our plan of reorganization at least through the end of September and this may be extended further. We will continue to follow the prescribed court supervised restructuring process. Our immediate next step is to pursue necessary modifications to our collective bargaining agreements, through the section 1113 process, which began today. This is another difficult step, but it remains our hope and our goal to reach consensual agreements with our unions consistent with our future as a successful, profitable and growing company. This is in the long term best interests of our people and our financial stakeholders.
In spite of all the distractions, the people of American are standing tall and doing a great job for our customers. American is operating better than it has in many years, and our recent revenue performance, driven by our network and alliance strategy, has been very strong.
Everywhere I travel, I hear loud and clear the conviction that it is time to return our company to the top. Our people are the best in the industry and, now, more than ever, we all need to remember that. I am focused on moving us through this process as quickly as possible so we can build a new American Airlines together.
Thank you for all you do every day to make American the leader we all know it can and will be.
Sincerely,
Tom
Dear American Team:
As you know, US Airways recently revealed its non-binding arrangements with our unions, which is part of an attempt to force a merger with American. While these tactics are not surprising, I'd like to explain what this means – and doesn't mean – for all of us.
First and foremost, nothing changes as a result of these announcements and we will proceed on our path toward a successful restructuring of American. Today we began the section 1113 process and US Airways’ actions are in no way binding on our company or our unions.
I think some perspective on these announcements is useful. It's easy to understand US Airways' sense of urgency to find a way to address the challenges it has faced for a long time. That story is well known.
However, I recognize all of our people have lots of questions about this. First and foremost, everyone should understand that what's best for our company, our people and our financial stakeholders will be determined by the facts in a disciplined manner and process. And this includes whether American will choose to pursue any combination down the road. This is the charge of the board of directors and the leadership team to be done in close collaboration with the creditors committee.
We know our restructuring, like others before, is hard work and the road ahead is challenging. It would be natural to look for an easy way out. But there is no easy path back to renewal and growth and industry leadership. It will require difficult choices. We must be mindful of other parties who don't have our best interests at heart and who are working their own agendas at our expense. There is real substance in our plan to build American with our industry-leading aircraft orders for 460 new narrowbody jets, up to 100 787s and 16 777s. These are planes which should benefit the careers of American pilots and flight attendants. And with this fleet plan, we will grow our network, which is already strong in the right cities and bolstered by the best partners around the world. We have a strong plan that creates lasting benefits for our employees, our customers, our financial stakeholders and our airline.
I want you to know these developments in no way alter our course. We are making significant progress, and the Court has granted us the exclusive right to pursue our plan of reorganization at least through the end of September and this may be extended further. We will continue to follow the prescribed court supervised restructuring process. Our immediate next step is to pursue necessary modifications to our collective bargaining agreements, through the section 1113 process, which began today. This is another difficult step, but it remains our hope and our goal to reach consensual agreements with our unions consistent with our future as a successful, profitable and growing company. This is in the long term best interests of our people and our financial stakeholders.
In spite of all the distractions, the people of American are standing tall and doing a great job for our customers. American is operating better than it has in many years, and our recent revenue performance, driven by our network and alliance strategy, has been very strong.
Everywhere I travel, I hear loud and clear the conviction that it is time to return our company to the top. Our people are the best in the industry and, now, more than ever, we all need to remember that. I am focused on moving us through this process as quickly as possible so we can build a new American Airlines together.
Thank you for all you do every day to make American the leader we all know it can and will be.
Sincerely,
Tom
USA320Pilot
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Iclubbabyseals
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Agreed. Especially when their unions start talking with ours.
USA320Pilot
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Merger Relief for American Airlines: April 24, 2012
ZACHS Investment Report
The rumors about American Airlines, a subsidiary of AMR Corp., merging with another airline have been heating up since the company filed for bankruptcy protection in November last year. Finally, the market buzz appears to be coming true with the three labor unions of American Airlines supporting a plan for the bankrupt carrier’s merger with rival US Airways Group Inc. ( LCC), the fifth largest U.S. airline.
This move represents a first step toward a consolidation, though creditors, directors, and management are yet to give their green signal.
The three unions – Allied Pilots Association, Association of Professional Flight Attendants and Transport Workers Union – represent as many as 55,000 employees at American Airlines. According to them, the merger would save about 6,200 jobs as opposed to what AMR Corp. can as a standalone entity, and speed up the restructuring process.
We believe the potential American Airlines-US Airways merger could change the competitive dynamics of the airline industry. The combination would be strong enough in scope and size to compete with their larger rivals, United Continental Holdings Inc. ( UAL) and Delta Airlines Inc. ( DAL). In fact, the combination would create an airline identical to the largest U.S. air carrier, UnitedContinental, in terms of revenue and traffic, and would be better than the second largest airline, Delta.
Further, the new carrier would leapfrog other airlines in the U.S. East Coast and Midwest. The potential combination would have lesser overlapping routes. The consolidation of American Airlines, if successful, would be the fourth in the last three years.
We see American Airlines-US Airways as the hottest pair in the industry as it will be in the best interest of the customers. Despite the long-standing problems with its pilot union, US Airways has been a profitable airline for the past several years, delivering best service to passengers with a top management team. On the other hand, American Airlines is a loss-making entity for several years due to its inefficient management team. In fact, it is the worst air carrier in the industry in terms of customer satisfaction.
Moreover, US Airways has been looking for a merger candidate following its bankruptcy protection filing in 2002. The company failed to acquire Delta, when it went bankrupt in 2006. As a result, US Airways will see American Airlines’ bankruptcy as a great opportunity to take over its larger rival.
We believe this is an opportune moment for American Airlines to consolidate in order to regain its lost profits and operational efficiency. As United and Delta will be long-term beneficiaries following the merger actions on both capacity and cost fronts, we believe American Airlines will also emerge as a successful candidate by balancing its debt level and lowering costs.
Nevertheless, any potential merger with AMR will take several months or a year to materialize, as American Airlines is yet to complete its court restructuring process and will undergo antitrust scrutiny.
Effective early this year, the shares of American Airlines were de-listed from the New York Stock Exchange. The company currently has a Zacks #3 (Hold) Rank for US Airways for the short term (1–3 months).
ZACHS Investment Report
The rumors about American Airlines, a subsidiary of AMR Corp., merging with another airline have been heating up since the company filed for bankruptcy protection in November last year. Finally, the market buzz appears to be coming true with the three labor unions of American Airlines supporting a plan for the bankrupt carrier’s merger with rival US Airways Group Inc. ( LCC), the fifth largest U.S. airline.
This move represents a first step toward a consolidation, though creditors, directors, and management are yet to give their green signal.
The three unions – Allied Pilots Association, Association of Professional Flight Attendants and Transport Workers Union – represent as many as 55,000 employees at American Airlines. According to them, the merger would save about 6,200 jobs as opposed to what AMR Corp. can as a standalone entity, and speed up the restructuring process.
We believe the potential American Airlines-US Airways merger could change the competitive dynamics of the airline industry. The combination would be strong enough in scope and size to compete with their larger rivals, United Continental Holdings Inc. ( UAL) and Delta Airlines Inc. ( DAL). In fact, the combination would create an airline identical to the largest U.S. air carrier, UnitedContinental, in terms of revenue and traffic, and would be better than the second largest airline, Delta.
Further, the new carrier would leapfrog other airlines in the U.S. East Coast and Midwest. The potential combination would have lesser overlapping routes. The consolidation of American Airlines, if successful, would be the fourth in the last three years.
We see American Airlines-US Airways as the hottest pair in the industry as it will be in the best interest of the customers. Despite the long-standing problems with its pilot union, US Airways has been a profitable airline for the past several years, delivering best service to passengers with a top management team. On the other hand, American Airlines is a loss-making entity for several years due to its inefficient management team. In fact, it is the worst air carrier in the industry in terms of customer satisfaction.
Moreover, US Airways has been looking for a merger candidate following its bankruptcy protection filing in 2002. The company failed to acquire Delta, when it went bankrupt in 2006. As a result, US Airways will see American Airlines’ bankruptcy as a great opportunity to take over its larger rival.
We believe this is an opportune moment for American Airlines to consolidate in order to regain its lost profits and operational efficiency. As United and Delta will be long-term beneficiaries following the merger actions on both capacity and cost fronts, we believe American Airlines will also emerge as a successful candidate by balancing its debt level and lowering costs.
Nevertheless, any potential merger with AMR will take several months or a year to materialize, as American Airlines is yet to complete its court restructuring process and will undergo antitrust scrutiny.
Effective early this year, the shares of American Airlines were de-listed from the New York Stock Exchange. The company currently has a Zacks #3 (Hold) Rank for US Airways for the short term (1–3 months).
USA320Pilot
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USA320Pilot
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I believe AA's unions will support the best deal. i.e. a merger or stand-alone plan.
For APA they believe the AA-US Airways merger is their best alternative. Click here to read why.
The APFA has broken off talks with AMR and are only supporting a merger with US Airways.
The TWU is sending out an offer that is going to have twice as many layoffs as the CPLR TA with US Airways and much deeper cuts. If the Mechanics and Ramp Agents vote down the AMR TA they will have a stronger case to support US Airways POR in court.
CallawayGolf
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It's not a conspiracy, but a legitimate method of gaining negotiating leverage in the face of otherwise very long odds for success. It's a win-win for APA and the other unions at AA. It let's them be proactive rather than reactive or victims in an untenable situation. They know US/Parker to be consolidation proponents and so they leverage that knowledge to broker a deal in case AA Management tries to stay it's stand-alone course with layoffs and concessions. With a better offer on the table AA Management had better come up with something that has broad support or they are sure to be in for a tough fight that they might not win. If AA Management is closed to the idea of merging or gaining labor peace, then the US/AA hostile takeover will be better for AA employees than the gutting that will take place in a stand-alone plan. So the labor groups generated their own leverage to win the best outcome whichever way it may go. Not many people crave change, but most can still see that change (in this case consolidation with US) has a far better outcome than what the Horton is proffering.
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