....."HUSH MONEY"..........

[ual777fan]

No, you missed the point, which was this: Despite the popular view that China and NRT Fifth Freedoms are a license to print money, those rights didn't prevent multi-billion dollar losses at UA or NW. They didn't prevent employees from suffering massive paycuts and furloughs at UA or NW. UA's finances were in the toilet in 2000, well before the terrorist attacks. Everyone else except for US made money that year. Bottom line? China and NRT Fifth Freedoms may not be the end-all everyone proclaims them to be. So substitute the multi-billion dollar losses, huge pay concessions and furloughs for the word "bankruptcy" if that helps you avoid the off-topic tangent you ran down and helps you understand that China and NRT may not be the panacea everyone thinks they are.

Today's UA/NW Pacific route networks are more diverse than they were 8 years ago, so the comparison is flawed at best (i.e. dramatically expanded China service). Still here is some prospective on the historical performance of UA's route network.

Actually during 2005, UA's Pacific operations accounted for about 14% of capacity and about 19% of operating revenue with a RASM north of 13c. It's easily the most profitable portion of the UA route network after the LHR runs.

During 2000, United ran into the red because they suffered an operation meltdown that was in no way shape or form because of nasty negotiations with ALPA or the horrible weather that year in the midwest. <_< It wasn't because the Pacific operation wasn't making enough money (it was) and you also have to remember that the Japanese economy had collapsed in the late 90's and still hadn't recovered in 2000.

 

[FWAAA]

Today's UA/NW Pacific route networks are more diverse than they were 8 years ago, so the comparison is flawed at best (i.e. dramatically expanded China service). Still here is some prospective on the historical performance of UA's route network.

Actually during 2005, UA's Pacific operations accounted for about 14% of capacity and about 19% of operating revenue with a RASM north of 13c. It's easily the most profitable portion of the UA route network after the LHR runs.

During 2000, United ran into the red because they suffered an operation meltdown that was in no way shape or form because of nasty negotiations with ALPA or the horrible weather that year in the midwest. <_< It wasn't because the Pacific operation wasn't making enough money (it was) and you also have to remember that the Japanese economy had collapsed in the late 90's and still hadn't recovered in 2000.

The NRT Fifth Freedoms and China access make money - no doubt about it.

But they didn't keep UA out of Ch 11. Not with the revenue meltdown after September 11, not with the SARS scare, not with the bankruptcy bookaway during the Ch 11 case. They make money, but they aren't a magic bullet.

 

[eolesen]

AA's purchase rights permit it to schedule delivery within 18 months of firm orders. AA can also take delivery of new 787s within 18 months of the first 787 delivery, thanks to those purchase rights. New 777s can be had within 18 months of order as well.

Absolutely correct. Boeing has a contractual obligation to make room for AA, which is entirely doable from their perspective because actual delivery dates aren't confirmed until a few months out.

If you were talking about immediate aircraft, that might be true, but the theory that AA needs to acquire another carrier to get future delivery positions is false, and NWA doesn't operate anything that AA couldn't currently get on their own with two or three months lead time (most of that being for pilot training...).

 

[ual777fan]

The NRT Fifth Freedoms and China access make money - no doubt about it.

But they didn't keep UA out of Ch 11. Not with the revenue meltdown after September 11, not with the SARS scare, not with the bankruptcy bookaway during the Ch 11 case. They make money, but they aren't a magic bullet.

Well UA's bankruptcy can be attributed to really crappy management and a really militant pilots union much moreso than the fact that Pacific wasn't making enough money. UA's management over the past 10 years has easily been amongst the worst in the entire industry.

 

[Mach85ER]

Absolutely correct. Boeing has a contractual obligation to make room for AA, which is entirely doable from their perspective because actual delivery dates aren't confirmed until a few months out.

If you were talking about immediate aircraft, that might be true, but the theory that AA needs to acquire another carrier to get future delivery positions is false, and NWA doesn't operate anything that AA couldn't currently get on their own with two or three months lead time (most of that being for pilot training...).

Sure that includes the 787?

Well aware of the 737 and 777 lead times.

 

[eolesen]

Positive.

http://seattlepi.nwsource.com/business/309...american29.html

March 28, 2007
Seattle Post-Inteligencer

American speeds up 737 order
Announcement could signal start of industry comeback
By JAMES WALLACE
P-I AEROSPACE REPORTER

In another sign that legacy U.S. airlines have returned to life and will need new airplanes for the domestic market, American Airlines announced Wednesday that it will push up by four years the delivery of 47 Boeing 737 jets.

American, the world's largest airline, also disclosed that it has purchase rights for Boeing's 787 Dreamliner, though it has not yet ordered that plane.
....
Arpey said American has the right to purchase on "short notice" additional 737s beyond those 47 planes. And it also has purchase rights for the 787, he said.
...

 

[NewHampshire Black Bears]

I'll (readily) admit, that the..."18 month (787) "thing" is a BIG-BIG asset for AA !!!!!!!!!!!!!!!!

Thanx eolosen for "proving It" beyond any reasonable doubt for all to see(Yup, that Includes me) !!

 

[FWAAA]

Not only can AA get the 787s on relatively short notice (once they're actually being produced, of course), but Arpey and Beer stated at least two years ago that AA was more interested in the 787-9 than the 787-8, and Boeing has consistently said that the -9 would be available nearly two years after the -8. Right now, Boeing's site says that the -8 should be delivered by early 2009 and the -9 by late 2010. If that's still the case, there just isn't any hurry for AA to announce orders now. AA will likely get the ducks, err, pilots in a row with a new contract and then announce a series of orders for dozens of them.

CO has converted most of its orders to -9s from -8s.