Delta-AA

[eolesen]

I suspect if Jeff Smisek or Richard Anderson called and said they wanted Doug, Kirby, or Isom to run UA or DL, I suspect any one of them would jump at it.

 

[BoeingBoy]

Comair doesn't factor into what DL does or does not do with AA - as was suggested by the article which doesn't really bring any new information to the table. DL shut down Comair because it was the right thing to do from a business standpoint.

It was one way to go. The other was to keep Comair and not invest in Pinnacle. Either way DL would lower the small RJ count operated under it's brand.

So too is buying the refinery

Finally a prediction that the refinery purchase will be successful...

BTW, Jim, DL plus AA WHOLE would not have 50% of the market - it would be much closer to 35%.

Are you including the express-type operations in that? Besides, I said "close to 50%", not "50%". 45% would count as "close to" 50%, even 40% could be interpreted as the same. This is the second time you've taken my words out of context - does your ego need reinforcing that badly?

As for the rest about buying parts of AA that become available, isn't that what I already said? Never mind the question about your ego - it seems to be rhetorical...

Jim

 

[wings396]

I suspect if Jeff Smisek or Richard Anderson called and said they wanted Doug, Kirby, or Isom to run UA or DL, I suspect any one of them would jump at it.

Yes we all know what a bang up job Jeff is doing over there at UA. Sounds like the employees just love him. I would hold off a bit before giving him a high rating.

 

[WorldTraveler]

Jim,
40% is not an acceptable answer to "close to 50%" regarding market share any more than you would accept a fuel load of 40K lbs on a flight where the flight plan calls for 50 or accept a MTOW of 150K lbs where the aircraft is limited to 120K.
But it doesn't matter, DL plus the MIA and DFW hubs of AA would be about a third of US market share, max, and probably less - and yes market share numbers include regional carrier operations since their revenue and passengers belong to the major carrier.

BTW, I have seen mentioned that Trainer will use Bakken crude which the DOE shows is discounted due to transportation bottlenecks - and even w/ transportation to the east coast is less than Brent crude. I believe Carlyle's refinery in the PHL area will be supplied by Bakken crude as well via rail. .
The crude market in the US has changed and the NE refineries now have the potential to be viable. it isn't surprising that a transportation company would recognize that changing supply locations and using a different method of delivery might change the economics of the plant.

Wings,
you have tried over and over to make this whole discussion personal and paint me as a Delta-loving, US-hating fanboy.

The simple fact is that US is working against a substantial size disadvantage to pull off AA just as it did with UA and DL. It is not personal, it is not fan-loving, it is simple business reality that US does not have the size to compete for a similar deal against DL if DL chooses to bid on AA and the creditors consider a break up of AA as a valid strategy - aside from the asset divestitures that US would have to do if it acquired AA.

But DL and US have different financial fundamentals, including DL's ability to demonstrate that it can pay handle a lot more debt, which includes frozen pension plans which US does not have.

DL's financial fundamentals are enough better than US' make a difference in the negotiations.... just for starters, if AMR as a whole fetches a $6B market cap, then the creditors will expect about $4-5B for the DFW and MIA operations which is about 60% of DL but more than 2X the current value of LCC.

One of those key fundamentals from an employee standpoint is that DL ALREADY pays its employees industry average or better wages which is exactly what AA employees want. The fact is even more relevant consider that DL's pilots have a current right now that will pay them 25% over AA's current wages by the first of the year. (hey FWA, if Jim can round 40 to 50 or v.v., I can round 24 to 25 can't I?)

Quit trying to make this personal and accept that there are basic business principles that are at play.

IF DL chooses to bid for parts of AA, they will do it for the same reason US would - because AA's assets have enormous economic value which DL would like to obtain as much as US would.

Those who want to look at motives for pushing AA-US might want to look at the insider trading activity that has taken place since AA entered BK and LCC's shares have soared much faster than its other network peers - largely driven by Wall Street hope of a merger.
It isn't AA execs that are buying LCC stock.

 

[wings396]

Well, I call em like I see em.
Please answer my question, what do you care if Parker fails? What bearing does it have on you? This is like me getting wrapped up in the possible merger between 2 cellular carriers. Utterly ridiculous.
Can you deny that you eat, sleep, and you know what Delta Airlines? Come on, get real already. In your world, Delta could put wings on a Turd, and it would be the greatest thing in aviation since the Wright Brothers.

 

[BoeingBoy]

Jim,
40% is not an acceptable answer to "close to 50%" regarding market share any more than you would accept a fuel load of 40K lbs on a flight where the flight plan calls for 50 or accept a MTOW of 150K lbs where the aircraft is limited to 120K.
But it doesn't matter, DL plus the MIA and DFW hubs of AA would be about a third of US market share, max, and probably less - and yes market share numbers include regional carrier operations since their revenue and passengers belong to the major carrier.

Bad comparisons. A min and a max limit is one thing, an off the top of my head guess between a min of 0% and max of 100% is another. Even you are now saying that for practical purposes all of your 35% (1/3 = 33.3%) is only for DL and a portion of AA, leaving out ORD/JFK/BOS/LGA/LAX at least. You see, I was talking about DL buying all of AA. That's closer to 50% of the domestic market.

After US' interest in US surfaced, you talked about DL buying AA - not pieces but a merger of the two. At that time you talked like there would be few to no regulatory problems, since DL/AA had less overlap than US/AA. One has to love how you change positions, hoping no one notices I suppose, while at the same time taking others' statements out of context so you can claim how wrong they were.

Jim

 

[WorldTraveler]

Jim, find a thread where I ever said that DL would buy all of AA. I've never said it. I have acknowledged all along that DL has overlap with AA; what I have spoken against is that US DOES NOT have overlap and that DL is not the only carrier that would have antitrust issues.

There is no change of positions. You simply did not understand what I said.

DL plus AA combined even in its entirety does not result in 50% of the US market. It just doesn't.

I have said repeatedly that DL cannot be ruled out as a potential acquirer of AA assets. Nothing more than that at this point.

Wings,
that you for confirming once again that you take this whole AA-US discussion very personally which is why you are just as rabid about dissing DL and in a discussion that is about DL and AA - which isn't about US - as you are in a discussion about discussing DL in a discussion that is about AA and US.

You simply do not want to hear that there is any other alternative to AA-US besides US, including an AA standalone plan - which you have argued against even when there was absolutely no mention of DL.

It is hypocritical for you to argue about me being emotionally wrapped up with DL when you can't recognize that the decision will be made on the basis of business factors -and has nothing to do with your personal preferences or mine.
It is not personal. Really. It is not a DL-US contest. Really. It is two carriers both looking for the possibility to grow their business - and to gain a competitive advantage over the other. That is what businesses do.

Step back and take a breath; your life will go on if US does not get its hands on AA. I have absolutely nothing emotionally invested in AA's well being. I do know plenty of AA people and I don't want anything but the best for them.
I don't wish ill on you or US or anyone in it.
If DL succeeds in acquiring ANYTHING of AA's, I will neither rejoice or be in sorrow. I have no emotion involved in DL's well being.

REALLY!

The aviation industry is business, not a poker game at the club.

The sooner you accept that reality, the sooner you will be able to accept whatever takes place as something beyond your ability to control and also which cannot and will not shake you as a person.

Now figure out how to help Parker win a potential bid on the basis of facts - aside from emotion. At this point we really have no evidence that the creditors at AA support any transaction other than an AA standalone plan.

 

[johnny kat]

Keep posting WT. While we may not want to agree with you, almost everytime I read your posts I gain a little knowledge and some food for thought. Now....if we could just get you to shift your loyalty to US.

 

[BoeingBoy]

Jim, find a thread where I ever said that DL would buy all of AA. I've never said it.

You have said that DL would face no more regulatory constraints than US if it acquired AA. But that's somewhat besides the point - that's from back when you said that DL would be a bidder against US for AA (remember DL hiring advisors to explore the possibility of acquiring AA). In the latest post, it was you misquoting me - I said that DL seems to have lost interest in acquiring all of AA, possibly because of the regulatory hurdles to the #2 and #3 carrier creating a mega-carrier, but that DL would probably be interested in select AA assets (depending obviously on what they specifically were).

That's the third time in the last several days that you've taken my words either out of context or misquoted me, presumably in an attempt to portray me as being wrong and yourself as right (or at least your latest position as right).

Jim

 

[WorldTraveler]

Keep posting WT. While we may not want to agree with you, almost everytime I read your posts I gain a little knowledge and some food for thought. Now....if we could just get you to shift your loyalty to US.

I don't expect you or anyone to agree with me. I do want you and others to argue on the basis of logic and not emotion.

I am not threatened by differing opinions.

If AA-US makes sense, it will happen. I have said that many times. But AA-US won't happen just because US people want it. US will have to present an offer that is superior to AA's standalone plan - PLUS any other that might come from other investors.

I have NOTHING against US. I want you to succeed. I have nothing to gain from your failure.

Jim,
neither DL or I have ever said that DL intends to acquire AA whole. They haven't lost interest if they never intended to do that.

I really have nothing to gain from proving yourself wrong or me right. I discuss the facts. Period.
If those facts are counter to what you have said, then I am sorry if you are shown to be wrong. If I said something that is not right, I am happy to admit it.
I haven't ever said DL would acquire AA whole - so adding their current combined market shares is irrelevant. Besides, you seem to forget that foreign carriers are indeed part of the US market if you want to talk about international routes as well.

 

[wings396]

I'm still waiting for a direct answer to my question.
Let me run it past you again, what do you care if Parker fails miserably merging AA & US? Delta can only benefit, correct? Are you worried about the employees of US or AA? Are you worried about the passengers?, investors? Shareholders? Are you worried that he will infact be very successful merging the two, and they will kick Delta's ass?
I'm not going on any emotions here Dude, I'm just looking to get to the bottom of your interests here with a friggen confession direct from you. Come on, be a man already and come out from behind the curtain. I have no reality to accept, I have been around for a long time, and have worked and lived thru more than you can imagine. Are you actually going to have the balls to say that you aren't the biggest pro Delta poster on these boards? I know that you think than most on these boards are not at your level, and can't see thru your intentions, but you are dead wrong.

 

[wings396]

Jim, find a thread where I ever said that DL would buy all of AA. I've never said it. I have acknowledged all along that DL has overlap with AA; what I have spoken against is that US DOES NOT have overlap and that DL is not the only carrier that would have antitrust issues.

There is no change of positions. You simply did not understand what I said.

DL plus AA combined even in its entirety does not result in 50% of the US market. It just doesn't.

I have said repeatedly that DL cannot be ruled out as a potential acquirer of AA assets. Nothing more than that at this point.

Wings,
that you for confirming once again that you take this whole AA-US discussion very personally which is why you are just as rabid about dissing DL and in a discussion that is about DL and AA - which isn't about US - as you are in a discussion about discussing DL in a discussion that is about AA and US.

You simply do not want to hear that there is any other alternative to AA-US besides US, including an AA standalone plan - which you have argued against even when there was absolutely no mention of DL.

It is hypocritical for you to argue about me being emotionally wrapped up with DL when you can't recognize that the decision will be made on the basis of business factors -and has nothing to do with your personal preferences or mine.
It is not personal. Really. It is not a DL-US contest. Really. It is two carriers both looking for the possibility to grow their business - and to gain a competitive advantage over the other. That is what businesses do.

Step back and take a breath; your life will go on if US does not get its hands on AA. I have absolutely nothing emotionally invested in AA's well being. I do know plenty of AA people and I don't want anything but the best for them.
I don't wish ill on you or US or anyone in it.
If DL succeeds in acquiring ANYTHING of AA's, I will neither rejoice or be in sorrow. I have no emotion involved in DL's well being.

REALLY!

The aviation industry is business, not a poker game at the club.

The sooner you accept that reality, the sooner you will be able to accept whatever takes place as something beyond your ability to control and also which cannot and will not shake you as a person.

Now figure out how to help Parker win a potential bid on the basis of facts - aside from emotion. At this point we really have no evidence that the creditors at AA support any transaction other than an AA standalone plan.

And do you have anything saying that the creditors don't? Are you one of them, or employed by them?

 

[WorldTraveler]

You won't get a confession because there is nothing to confess.

It is a business transaction. PERIOD. Move on and quit thinking that someone who can't support the ideas you do is against you personally.

I am not part of the creditors committee or anything else.

The creditors have made no public support for ANY transaction - or against anything. They have repeatedly said their support is behind an AA standalone plan.

That doesn't mean that someone with a little business knowledge can't understand the principles of competition that will apply if a competitive bidding situation arises.

Those are business facts. If US and DL both compete for AA and US wins, I will be happy to admit I was wrong. But if US wins, I am quite certain the business will not be viable because the only way US could outbid DL is by offering more debt - which would put the weight of debt on US far above other airlines - and highly subject to failure.

I don't believe the creditors would accept an offer that is heavily debt-loaded.

It's not personal. It's business. Quit looking for demons behind other people's opinions or believing they are against you.

 

[wings396]

To the best of my knowledge, Boeing is the only one that has publicly given support to AA' s plan, and I think that most of US know the reasoning there.

 

[WorldTraveler]

The most recently stated position of the UCC came 10 days ago with respect to the 1113 process and it says essentially that they are using AA's standalone plan as the baseline and looking for validation of its validity as well as whether any other plan can top it:

"Consensual deals or abrogation of unresolved CBAs is necessary to AMR's successful
reorganization so that the company can validate the assumptions in AMR's standalone
business plan and continue to explore strategic alternatives in close collaboration with the
Committee to compare against the standalone plan. ..."