Citing shutdown, DoJ requests stay in fight over U.S. Air, AMR deal

[robbedagain]

but if the judge were to say rule in favor of the airlines.. then what would the doj do it just seems that they are or have been caught off guard with the way the airlines are fighting back at them etc and then the judge rules based on his or her schedule then the doj wanted a stay they did not get that. now the biggie state of texas supports the merger it sure looks like the airlines are in the lead for now.... interestin days are a comin and comin fast

 

[AANOTOK]

Furthermore, if your not in the business, what the hell do you care who cuts what. I believe that you may have some underlying interests here.

Maybe this will give you an idea where Miss Cleo is coming from.

Quote by Jacob:
"The ironic thing here is that if the merger doesn't go through, Horton can now really screw the AA unions with a new contract/agreement and the unions can't do too much besides striking (and I don't think that would work long-term).

I think Horton should redo contracts and completely dump the pensions the way UA and DL did."

 

[WorldTraveler]

DL only terminated the DL pilot pension but all other DL and NW pensions are frozen just like AA is planning. the combined underfunding for AA and DL will likely be similar. DL is accelerating pension funding.

Robbed
The agreement with Texas doesnt change that AA US will control 67% of DCA slots which the DOJ will have no problem in requiring divestitures. Then there still is the problem w those emails some of which did originate from AA. the judge is not going to just forget about them.

 

[FWAAA]

While a merged US+AA could grow, a lot of pundits keep repeating the obvious: mergers generally result in the removal of redundant capacity, not growth. Since I'm not a mind-reader, I don't know whether Doug Parker intends to grow new AA or whether he'll do what he's done at US since the 2005 merger, which is essentially no-growth. Despite the lowest pilot and FA costs among the legacies since 2005, Parker didn't leverage that cost advantage and grow US Airways.

Whenever someone mentions the Horton stand-alone plan (which calls for 20% growth over five years, or 3.7% growth per year), someone else says that such huge expansion by AA would trigger a ruinous fare war that would send AA and the other legacies back to Ch 11.

One thing is certain: AA has been where US has aimed most of the Advantage Fares over the years, and once merged, new AA isn't going to "compete against itself" - it's impossible for a single company to "compete against itself." So consumers lose the benefit provided by the lower-than-AA Advantage Fares.

This merger would cut the number of big domestic competitors from five (AA, UA, DL, US and WN) to four. That's a more highly concentrated market than resulted from the prior mergers, where there were more competitors after the merger.

Obviously, Texas (and likely the other states' AsG) isn't concerned with that highly complex economic theory of the case, preferring to get written promises to keep serving lots of Texas towns and to keep the HQ in TX and to keep DFW as a big hub (as if those weren't already in the cards).

Maybe this is just about the number of DCA slots and once Parker agrees to give up a bunch of them the federal government will settle. Problem is, the DoJ identified more anti-competitive effects than just the DCA slots, and giving up a few dozen slot pairs at DCA isn't going to fix those other problems. That's why I don't think there will be a settlement.

 

[IORFA]

At the rate this is going, all DCA slots that are leased out should be only available to be flown from the smaller communities they served before AA/US were forced to give them up. If people really want to serve DCA, then they should serve the under served smaller communities instead of adding more LGA, MCO and other over served cities. What's fair, is fair.

 

[robbedagain]

i understand that heres my take on that.. i think from 67% i could see may be 12% of the slots be given up which would leave it where us is currently at 55% of the slots... as for the emails i wonder if its possible the judge would say it cannot be included for whatever reason and or say well you the doj allowed the other biggies to form thru and they did similar i do see what youre saying wt. but the quest is will the judge allow those emails or not we shall see if the judge does that could also open a can of worms esp if the doj does not have to show how they allowed the other mergers and the interviewer or views etc its all gonna be a play out to be seen

 

[WorldTraveler]

the states cant be concerned about pricing or at least they can't do anything about it bc that is federal domain. States are most concerned about jobs and they can enforce that. They also can get promises about maintaining service which is the best guarantee of decent fares.

Yes the DCA slots should be used for small town service which is why B6 and WN won't walk away w all that is divested.

The other airlines didn't write emails and make speeches saying consolidation would help raise fares. They just did not. With history and now written evidence...and there could
be more than we know...there is r
eason for concern and it is doubtful the judge will just let it slide. What she does is the big question.

 

[RowUnderDCA]

I am wondering if the DOJ includes these states in their action, so as to put the defendents in a double bind. Whereas, the DOJ and the states are suing to stop the merger, they are not doing it on the same grounds. The states seem to want the new merged carrier to not consolidate frequencies, upguage aircraft and exit markets, and thus freeing up capacity in the market, when the DOJ would seem to prefer just that: the merged carrier exiting markets.

Would a judge ever recognize such inconsistencies amongst plaintiffs? Would

 

[robbedagain]

wt while the other airlines may not have done it via email but i do wonder if in fact they were think the same and or may be they did the email and then deleted given how easy it was for the doj to approve of all of those mergers and while the doj did not put a block in the ual co merger ual did lease 18 slots at ewr. i wonder though if somehow someway now that tx is on the airlines side if any other states get similar deals like tx things could become hard for the doj in any way it will be quite interesting to see. rowunderdca you make very valid question itll be interesting to see

 

[MCI transplant]

More news!


http://aviationblog.dallasnews.com/2013/10/twu-asks-to-intervene-in-the-american-airlines-us-airways-antitrust-lawsuit.html/

 

[WorldTraveler]

The DOJ and the states are not in conflict. The DOJ is focused on DCA plus behavioral and pricing issues. The states are focused on maintaining current jobs and service levels but they are not going to argue if they trade 5 DCA flights for something else.

Your and my thoughts can't be used in court against us. IF they could we would all be in jail. Others knew better than to put some things in writing.

 

[Bob Owens]

While a merged US+AA could grow, a lot of pundits keep repeating the obvious: mergers generally result in the removal of redundant capacity, not growth. Since I'm not a mind-reader, I don't know whether Doug Parker intends to grow new AA or whether he'll do what he's done at US since the 2005 merger, which is essentially no-growth. Despite the lowest pilot and FA costs among the legacies since 2005, Parker didn't leverage that cost advantage and grow US Airways.

Whenever someone mentions the Horton stand-alone plan (which calls for 20% growth over five years, or 3.7% growth per year), someone else says that such huge expansion by AA would trigger a ruinous fare war that would send AA and the other legacies back to Ch 11.

One thing is certain: AA has been where US has aimed most of the Advantage Fares over the years, and once merged, new AA isn't going to "compete against itself" - it's impossible for a single company to "compete against itself." So consumers lose the benefit provided by the lower-than-AA Advantage Fares.

This merger would cut the number of big domestic competitors from five (AA, UA, DL, US and WN) to four. That's a more highly concentrated market than resulted from the prior mergers, where there were more competitors after the merger.

Obviously, Texas (and likely the other states' AsG) isn't concerned with that highly complex economic theory of the case, preferring to get written promises to keep serving lots of Texas towns and to keep the HQ in TX and to keep DFW as a big hub (as if those weren't already in the cards).

Maybe this is just about the number of DCA slots and once Parker agrees to give up a bunch of them the federal government will settle. Problem is, the DoJ identified more anti-competitive effects than just the DCA slots, and giving up a few dozen slot pairs at DCA isn't going to fix those other problems. That's why I don't think there will be a settlement.

I agree with much of what you wrote, and except for the numbers the same can be said for all the mergers that were approved, they all resulted in the combined carrier not equaling the sum of the two. Flights reduced, service reduced and employees reduced. So the AA-US merger is no different than the ones that preceded it, only the numbers are a little different. I wish it wasn't so, but I think the merger will go through eventually. AA will make a ton of promises to gain political support, break pretty much all of them, but still get what they want.

 

[Bob Owens]

Your and my thoughts can't be used in court against us. IF they could we would all be in jail.

Not to worry, they are working on that!

 

[Bob Owens]

So, you're tellling me when DL+NW merged cities/routes/flights weren't cut?

You're tellling me when WN+FL merged cities/routes/flights weren't cut?

You're tellling me when UA+CO merged cities/routes/flights weren't cut?

You're tellling me when AA+TW merged cities/routes/flights weren't cut?

Speaking of "armchair CEO's"...are you the CEO of AA? US? ANY company? Do you have managment experience at an airline? At any company?

Have you taken any economics classes? Business classes?

Are You? Of course flights, service and jobs will be cut, and prices and fees will continue to climb, that's why the DOJ should say NO. That and Hortons $20 million.

 

[OldGuy@AA]

I agree with much of what you wrote, and except for the numbers the same can be said for all the mergers that were approved, they all resulted in the combined carrier not equaling the sum of the two. Flights reduced, service reduced and employees reduced. So the AA-US merger is no different than the ones that preceded it, only the numbers are a little different. I wish it wasn't so, but I think the merger will go through eventually. AA will make a ton of promises to gain political support, break pretty much all of them, but still get what they want.

Yeah just ask anyone from Raleigh/Durham N.C. or San Jose CA. if you want to know about promises from AA. I agree that the DOJ is right. They have no plans to grow. They will shrink capacity and drive prices up. But we knew Delta and United would do that also.