Is USAirways hostile takeover Of AA for Real?

[PITbull]

Hey kat,

As much as we spend wiriting on her; you spend reading...so you obviously just aren't that busy!!!!

I spent 25 years lving out of hotel rooms. I know all about what the jobs about. That's why I'm on here. The labor groups should recieve their just rewards for a decade of consessions and consolidations, lowest wages in the industry. NO additional mergers should take place until and unless the labor groups ratifiy a contract they will live with for the next decade...and it an't no AA concessionary agreement that's for certain!

 

[WorldTraveler]

Look into how many times Delta has merged before making that claim........

great question.... let me give it a try.

Post WWII -

US
All American --> Allegheny
Lake Central
Mohawk
PSA
Piedmont
America West

DL
Chicago-Southern
Northeast
Western
Northwest
(Pan Am was not a merger but an asset acquisition, BTW)

DL and US historically had few int'l routes. US has not engaged in a merger or asset acquisition with a carrier that provided much if anything in that regard. Perhaps that is part of why HP finds it hard to compete against the big 3.

However, note that PA and NW both gave DL significant assets in the int'l arena - and DL has continued to develop them.

Rather than focus on how many mergers - although it appears that US still leads in that category - it might be better to ask what US has done to help them compete on a global basis - which would appear to be the primary benefit they would gain by going after AA.

 

[johnny kat]

Hey kat,

As much as we spend wiriting on her; you spend reading...so you obviously just aren't that busy!!!!

I spent 25 years lving out of hotel rooms. I know all about what the jobs about. That's why I'm on here. The labor groups should recieve their just rewards for a decade of consessions and consolidations, lowest wages in the industry. NO additional mergers should take place until and unless the labor groups ratifiy a contract they will live with for the next decade...and it an't no AA concessionary agreement that's for certain!
___________________________________________________________________________________________________________

PITbull,

I have set on the jumpseat with you and worked along side you. I was proud of you and the way you stood up when things were sooo bad. I totally agree with you about a contract for us first. But, having been flying now for 30 years and many more to go because of the lack of retirement, you must understand that in order to get unstuck from this wretched BK contract we must vote yes on something. I know, I know it can't just be any old contract but lets face it we all suffering from the Stockholm Syndrome. That being said something clearly has to change. A contract must be ratified before merger or else we are kicked in the teeth once again.

This merger clearly is the best way forward for someone in my situation, which is to say, most of the employees at US who have too many years on the jumpseat and still have too many years before the rocking chair. In my view managment at US and AFA leadership are both to blame if we don't get a contract and soon. The word immoral comes to mind. And I bet most of the beaten down employees at AA feel the same. Heaven help us all.

 

[johnny kat]

I have to go cut the grass now.

 

[wings396]

great question.... let me give it a try.

Post WWII -

US
All American --> Allegheny
Lake Central
Mohawk
PSA
Piedmont
America West

DL
Chicago-Southern
Northeast
Western
Northwest
(Pan Am was not a merger but an asset acquisition, BTW)

DL and US historically had few int'l routes. US has not engaged in a merger or asset acquisition with a carrier that provided much if anything in that regard. Perhaps that is part of why HP finds it hard to compete against the big 3.

However, note that PA and NW both gave DL significant assets in the int'l arena - and DL has continued to develop them.

Rather than focus on how many mergers - although it appears that US still leads in that category - it might be better to ask what US has done to help them compete on a global basis - which would appear to be the primary benefit they would gain by going after AA.

I'm going to dispute the Pan Am claim you have posted.
Delta cherry-picked the crown jewels of PA, and in return promised them financial backing to continue on with the leftovers. After a short time, Delta pulled the plug on what was left of PA causing them to fold like a deck of cards. Ask some former PA people for their thoughts on how Delta was to them. Delta knew very well that PA had no chance of surviving after they sold off the best part of what little they had left. It was basically a merger, just a partial one though.

 

[WorldTraveler]

Don't need to ask the PA employees since we can look at court records since DL was taken to court over the collapse of Pan Am.

DL bought the transatlantic assets and Shuttle and invested in a reorganized PA which was focused on Latin America. PA burned thru the cash far faster than the business plan showed, DL said it would invest no more money, and PA shut down and was liquidated. I was in NYC when it happened.
But the court ruled that DL did not make a continuing investment but rather one that required PA to maintain a certain level of profitability.
DL simply did not continue to invest. PA burned thru the money DL loaned them.

PA was an asset acquisition. Every part of PA's international network was sold by asset acquisition, not in a merger.

BTW, United bought the Pacific Operation, LHR, and after the shut down, the Latin American operation, on which they were unable to compete at the hands of AA. UA's purchase of PA's Latin American operation is the only case in US aviation history when an acquirer of one of the original international regions operated by one of the original carriers that had a dominant position in the region was unable to make it work from the gateways where the original routes were based. No other carrier who has acquired any of the int'l remnants of PA or the TATL network of TW, NW, or BN (later EA) failed to make those networks work from those gateways.

One more... DL hired 6500 PA employees in exchange for buying Europe w/o LHR. How many PA employees did UA hire given all that it acquired from UA? I can tell you it was nowhere near 6500 people.


Remember, though, the question is what US has done to build its presence in the international arena. AA bought TW's LHR operation and later the rest of TW and AA does still have an int'l presence at JFK. AA also bought the BN and then EA int'l operation.
DL and UA have made their own asset acquisitions and mergers in the int'l arena.

So what has US done?

 

[wings396]

Sadly, the lack of International flying dates way back to Ed Colodny and the original US. At the time US & PI merged in 1989,
PI had already started LGW with a 767, and was aiming towards some other Int'l destinations. US on the other hand, had no Int'l flying and ZERO interest in starting any. From what I had been told, Colodny had even considered getting rid of the 767's at one point. As most of us know, he bailed out soon after merging PSA & PI into US. This to me was the beginning of the end for US.
Colodny handed the airline over to Schofield at a very bad time, and it only got worse from that point. Years of financial hardship followed, and starting any new Int'l service wasn't even on the radar screen. It wasn't until The Wolfman came onto the scene that someone made an effort to start building up an Int'l presence using PHL as a gateway. So there is your answer as to why US is so far behind most others when it comes Int'l flying. Delta was expanding their network, while US did basically nothing for nearly a decade. Not any of the employees fault, and not Parkers either. We have had poor management with no direction for the company for many years. I do believe that Parker wants to change this direction, and if given the right tools he may just be able to do it.
Prior to now,US wasn't in any position to aquire anything from anyone. Sad, but true....

 

[MCI transplant]

Sadly, the lack of International flying dates way back to Ed Colodny and the original US. At the time US & PI merged in 1989,
PI had already started LGW with a 767, and was aiming towards some other Int'l destinations. US on the other hand, had no Int'l flying and ZERO interest in starting any. From what I had been told, Colodny had even considered getting rid of the 767's at one point. As most of us know, he bailed out soon after merging PSA & PI into US. This to me was the beginning of the end for US.
Colodny handed the airline over to Schofield at a very bad time, and it only got worse from that point. Years of financial hardship followed, and starting any new Int'l service wasn't even on the radar screen. It wasn't until The Wolfman came onto the scene that someone made an effort to start building up an Int'l presence using PHL as a gateway. So there is your answer as to why US is so far behind most others when it comes Int'l flying. Delta was expanding their network, while US did basically nothing for nearly a decade. Not any of the employees fault, and not Parkers either. We have had poor management with no direction for the company for many years. I do believe that Parker wants to change this direction, and if given the right tools he may just be able to do it.
Prior to now,US wasn't in any position to aquire anything from anyone. Sad, but true....

And you believe now you are?

 

[wings396]

Yes, at least US is turning a profit at this point and Parker has the financial backing. Say what you wish, but at least he has some long term vision for the Airline which is more than any CEO that US has had for the past 23 years.....

 

[signals]

I honestly don't think that it matters how much financial backing you have, otherwise it would be put up for a bid. That's just my opinion. Even if ultimately US does merge or acquire AA, it would be because a judge deemed that that would be the best outcome for its creditors.

Just saying.

 

[700UW]

The Judge doesnt decide on a merger, that would be AA's leadership and the creditor's committee, if that is what AA wants in the POR, the judge does approve the POR.

And if AA mergers outside of chapter 11, its only up to AA.

 

[WorldTraveler]

Sadly, the lack of International flying dates way back to Ed Colodny and the original US. At the time US & PI merged in 1989,
PI had already started LGW with a 767, and was aiming towards some other Int'l destinations. US on the other hand, had no Int'l flying and ZERO interest in starting any. From what I had been told, Colodny had even considered getting rid of the 767's at one point. As most of us know, he bailed out soon after merging PSA & PI into US. This to me was the beginning of the end for US.
Colodny handed the airline over to Schofield at a very bad time, and it only got worse from that point. Years of financial hardship followed, and starting any new Int'l service wasn't even on the radar screen. It wasn't until The Wolfman came onto the scene that someone made an effort to start building up an Int'l presence using PHL as a gateway. So there is your answer as to why US is so far behind most others when it comes Int'l flying. Delta was expanding their network, while US did basically nothing for nearly a decade. Not any of the employees fault, and not Parkers either. We have had poor management with no direction for the company for many years. I do believe that Parker wants to change this direction, and if given the right tools he may just be able to do it.
Prior to now,US wasn't in any position to aquire anything from anyone. Sad, but true....

Yes, at least US is turning a profit at this point and Parker has the financial backing. Say what you wish, but at least he has some long term vision for the Airline which is more than any CEO that US has had for the past 23 years.....

we are on the same page on both points.
US, like AA, DL, and UA were all predominantly int'l carriers. PA, as most of us know, failed in part because it was unable to feed its int'l flights and compete against much stronger domestic carriers who had smaller, more efficient airplanes that helped whittle away at PA's int'l dominance, including by opening up new hubs.
But AA, DL, and UA all spent significants amount of energy older the past 35 years buying airlines w/ strong int'l networks - and it is precisely the ability to offer domestic and int'l flights that have helped AA, DL, and UA.

US has indeed done a whole lot to understand what it takes to compete w/ the big boys and to build a viable airline in light of US' network. But it still says that buying AA is probably the last chance US has to buy a significant part of any US carrier's int'l network - which could well mean the difference between whether US will move into the "big leagues" or be permanently relegated to an in-between category - part legacy but w/o the strength and network of the others but too high cost to really effective as a low cost carrier.

All of us understand the huge strategic implications of the next few months in which AA's future will probably be decided - and whether it includes US or not.


It is also noteworthy that AA, DL, and UA were all stronger and larger than the airlines from whom they bought their int'l assets or with whom they merged. If US succeeds this time at acquiring AA, it will be historic in many regards.

But it is entirely possible that US waited too long in acting to secure its future - and if AA slips away, it is far from certain what the future holds for US.

 

[signals]

The Judge doesnt decide on a merger, that would be AA's leadership and the creditor's committee, if that is what AA wants in the POR, the judge does approve the POR.

And if AA mergers outside of chapter 11, its only up to AA.

I'll admit I stand corrected on that. I still view AA as an asset to any other airline. I believe their BK was a well calculated move, and that they have learned from other EARLIER BKs. Whatever AA does, it will be AA calling the shots in the long run.

'nuf sed!

PS enlighten me on a POR???

 

[jimntx]

Plan of Reorganization

 

[signals]

then AAs POR is on schedule