Hopeful,
I don't like the idea either. I'd rather grow and compete. I'd also like rainbows ending in my front yard with unicorns playing with bunnies and kittens. The problem is, it's not going to happen, not a single analyst or airline manager outside AA thinks it will happen either. Wallstreet doesn't think it is going to happen,( they loan the money right?). They all think AA will have to merge with USAirways. But on this board we have WT, Eolesen, FWAAA and others who think this isn't going to happen and AA can grow and prosper under Horton's (public) plan. The problem is, even Horton knows the cornerpost plan is a doomed, his likely plan is to buy USair and enjoy locked-in labor contracts for the next ten years. Are you guys going to be shocked if he does this.
Here's another good one. Do you know what DAL executives call the Horton's plan 'the Tombstone strategy'.
humor us... which DL exec would that be?
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I'll reiterate once again that I do not work in the airline industry or in any consulting capacity to it. But I do have the education and experience to understand the business of the airline industry.
I would focus your attention on my track record of what I have said on this forum... there are ten years and 4000 posts from which you can make your call. I have a pretty good track record.... the biggest blunder I have made was predicting that UA would fail and provide DL w/ a Pacific route system. UA's story is not finished - we are all still "in progress" but I find it hard to believe that UA is going to be able to make it long term w/o forking over a whole lot of money or having labor discord that will make what AA has had to deal with look like child's play.
I would also remind you that being an airline pilot or any other airline employee doesn't necessarily make you a good manager outside of the cockpit. The history of labor control of the executive suite both inside and outside of the airline industry has very few true success stories for business and a whole lot of examples where labor wasn't willing to make the tough calls to keep the business viable long term and instead like we saw with UA a continual effort to use the company's resources to further labor's pocketbook even if it jeopardized the company's longterm future. The summer of hell at UA in 2000, the massive pay increases, and the subsequent BK marked the end of any hope that labor could meaningfully play a major mgmt role in the airline industry... and the traditional adversarial role remains except in those few airlines that have managed to stay largely non-union or who have paid large premiums to labor to keep them happy. AA and UA have not and likely will not fit either of those categories of success.
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Actually, there really is no evidence at all that the majority of Wall Street supports a merger with US. There are people who have weighed in supporting it but none of them have addressed a number of key issues, the greatest of which is why AMR's non-labor creditors would support a merger with US that is based on REDUCING the cost cuts that will be made in order to buy labor peace for a merger in which AA would be saving US, not the other way around. Why do AMR's creditors have any interest in increasing their risk by taking on US when they can get all they need to turn AA around in BK?
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On the subject of AA-US, the members of the board have fallen into 4 camps - those supporting US and who want to see AA provide US with the resources to compete with DL and UA (and the analysts who have supported it have all been driven by that idea as well), AA employees who are looking for a way to reduce the cuts they will have to take in BK, AA mgmt supporters many of whom I have strongly disagreed with in the past and who now believe the AA standalone plan is best, and independents like me who have no allegiance to any of the parties but also believe like group 3 that the best chance of AA's success long term is to cut costs deeply enough in order to turn the company around and compete. Yes, I get that the whole growth plan the cmopany has proposed is far from certain but cost cuts have been shown to be capable of providing the room airlines need to compete. UA and US both obtained those cuts in large measure and have largely not rewarded employees for their sacrifices that enabled those companies to turn around. I doubt if that will ever change - to the detriment of those employees - and esp. the PMCO employees who did turn their company around based on mgmt that believed in that principle.
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My question to you remains the same: what is your plan B and how do you realistically think you will get there? If US is plan B, then explain how the non-labor creditors will be convinced and how US-AA will be more viable than AA on a standalone basis when US-AA is based on reducing the size of the cuts that AA is proposing?
