Our Nation's Flag Carrier

[FA Mikey]

The debt load would be outrageous and the aircraft and engine compatibility unworkable. It would be Like TW all over again in taking over closing up mach of what UAL was. Drops AA's Competition in transcons and NRT. It close up the biggest competitor in ORD and to LHR.

 

[jimntx]

Landing slots? Yeah, they are so valuable! This behavior is known as 'holding onto the past rather than confronting the future' and the only really important landing slots (for this discussion anyway) are LHR.

Well, NRT would be another very contentious airport. Northwest would have more than a word or two to say about the number of slots that a UAL--AA combo controlled.

Ya think everyone would've learned something from the AA/TW merger and could apply those lessons here? Or do the unions just wanna keep stick with the same old tired formulas?

Since the AA/TW merger union issues are not yet settled in the courts, just what lessons are to be learned. So far, we only know the problems and the turmoil, the lessons usually come from the outcome which is unknown.

In the unionized trucking business mergers between carriers are reasonable because of foresight. Are you trying to tell me that those dirty truckers are more refined than all of you high-falutin' airline folks?

Well, considering that most of the trucking companies "solved" their union problems by making the truckers "independent" contractors, it's not really a good example.

Why does anyone have to 'give up' ORD or SFO? The legacy airline employees are fond of proclaiming that they will return to crush the LCCs -- here' your chance!

And, you assume that the lessons learned by other cities that have become fortress hubs of a single airline will be totally lost on the distinguished burghers of Chicago and San Francisco. The unions are supposed to learn lessons from the past but not politicians???

I can't believe that big brave fearsome AA & UA people actually are worried about the LCCs crying and some DOJ investigation! Guys, we're talking about your survival here and now you're worried about somebody's feelings getting bruised??

It's not a question of being "worried" about a DOJ investigation. It would never get that far. If the DOT would not approve a merger between UAL and much smaller US Airways, what makes you think for a second that they would approve a merger between the two largest airlines in the U.S? Puhleeze!

Shoot, this might even generate enough new business that you could put Busdrver back to work and maybe even find a spot for other laid off pilots. You know, unique corporate transaction kinda stuff!

Well, now I know. USA320PILOT'S disease is contagious. Log off right now and call your physicians, people. You may already be infected.

P.S. Macy's and Bloomingdale's did NOT merge. They were both purchased by Federated Stores, a holding company.

 

[peasant]

And the McD/ Boeing merger really worked out well in maintaining US jobs and market share didn't it... :unsure:

 

[Man of the People]

To whatkindoffreshshell:

There would be too many complications from a merger. Yes, the seniority issue would resurface its ugly head again. There are still strong emotions from many affected by the acquisition of TWA by AA. You should be honing your skills for another line of work, because, quite franky, the airline industry is pretty much over. This is no longer a career job. This is merely a job, much like any other where all your hard work is forgotten in the blink of an eye. 9/11 has a lot to do with that, but this cannot all be blamed as a result of that horrific day.

 

[LiveInAHotel]

Tell me this hasn't been considered in the hallways of Plano & Elk Grove??

Surely the merged AA/UA could be a formidable competitor as our national champion and the cost savings from elimination of duplicate functions could go a long way to matching the LCC CASM benchmark!

It ain't such a wild idea folks (well, maybe the idea of dusting off Bobby Crandall to knock together the necessary heads during the assimiliation process) but hey, this new airline would really be something to get excited about!

Go ahead, tell me why it couldn't work. And no union excuses either.

I'm telling you it will work!

I see you have been hitting the crack pipe hard again! 😉

 

[goingboeing]

The final nail in the airline coffin would be a AA/UA merger.
AA management has already bought 1 loser in bankruptcy and AA could not withstand another loser being merged into it.

It would not surprise me if AA management is considering this option of a UA bankruptcy buyout.

 

[LiveInAHotel]

The final nail in the airline coffin would be a AA/UA merger.
AA management has already bought 1 loser in bankruptcy and AA could not withstand another loser being merged into it.

It would not surprise me if AA management is considering this option of a UA bankruptcy buyout.

I doubt AA would buyout UAL. I see them maybe buying slots and (Pacific) routes from UAL and nothing more.

 

[JFK777]

AA/NWA would be a better fit if a mega airline was to be created. This would be a better distribution of hubs. On the international side, NWA's strength in Asia fits well with AA's Miami and LHR opertaion. Nwa is strong in Amsterdam but not a force everywhere else in Europe.

 

[SkyLiner]

The final nail in the airline coffin would be a AA/UA merger.
AA management has already bought 1 loser in bankruptcy and AA could not withstand another loser being merged into it.

It would not surprise me if AA management is considering this option of a UA bankruptcy buyout.

Fact: The only reason that TWA was a loser is because it allowed AA to force the bankruptcy as a condition of the acuisition. We were not in bankruptcy until AA came along to "rescue/destroy" us.

 

[whatkindoffreshhell]

Well, NRT would be another very contentious airport. Northwest would have more than a word or two to say about the number of slots that a UAL--AA combo controlled.


Since the AA/TW merger union issues are not yet settled in the courts, just what lessons are to be learned. So far, we only know the problems and the turmoil, the lessons usually come from the outcome which is unknown.


Well, considering that most of the trucking companies "solved" their union problems by making the truckers "independent" contractors, it's not really a good example.


And, you assume that the lessons learned by other cities that have become fortress hubs of a single airline will be totally lost on the distinguished burghers of Chicago and San Francisco. The unions are supposed to learn lessons from the past but not politicians???


It's not a question of being "worried" about a DOJ investigation. It would never get that far. If the DOT would not approve a merger between UAL and much smaller US Airways, what makes you think for a second that they would approve a merger between the two largest airlines in the U.S? Puhleeze!


Well, now I know. USA320PILOT'S disease is contagious. Log off right now and call your physicians, people. You may already be infected.

P.S. Macy's and Bloomingdale's did NOT merge. They were both purchased by Federated Stores, a holding company.

Agreed on the NRT slots. But as for your other points....

-- unionized truckers are not independent contractors. They manage to successfully merge seniority lists etc so why are airline people so different?

--any AA/TWA court problems should not prevent the airline industry from progressing, do you think the flying public really cares about seniority integration issues? Those are housekeeping details.

--the distinguished fortress burghers in PIT are complete idiots. Learn from their pompous mistakes.

--who cares if it was a holding company for Macy's/Bloomies?? Set up a holding company for AA/UA and move on!

--the DOT/DOJ review of UA/US back in 2000 is ancient history. The landscape has dramatically changed, the feds ain't your problem, the LCCs are.

--I went and bet the mortgage on the tip of a forthcoming UCT/ICT. Do you mean to tell me that some of our board colleagues post poppycock? I've been bamboozled!

(thanks for your post, I enjoy the give/take)

 

[flyhigh]

...one good example to look at might be Conrail. It was created by the gov't as a result of multiple bankrupt railroads. While it did stumble along for quite some time, once they got on their feet, it was one of the best in the industry. It takes a long time to turn around on old world company like airlines & railroads. While Conrail in the end was relatively small and was bought, it could have been a buyer as well that grew. I could see a possible multiple bankruptcy by the big carriers (AA,UA,DL,NW,CO) with the gov't stepping in to merge and splice them up. Keep in mind that while LCC's might cry foul, none of them will be ready willing to step up and serve many of the cities that lagacy carriers currently do serve. As a result, the gov't could use that as a solid reasoning and merge a couple of the carriers, drop the unnecessary pieces and move from there...just a thought.

 

[Oneflyer]

If you listen at all to Arpey you realize that AA would have no interest in a merger with UAL. Arpey's focus is to reduce costs by simplify the airline. Merging UAL would throw that right out the window. 15 or more fleet types, more room through coach, less room through coach, Ted, economy plus, just reconfiguring the seats would cost millions. The debt would be out of control. The merger would eliminate all of the cost saving measure AA has done to make itself stronger, de-peaking, faster turn times, etc.... What a mess.. Why not just buy the Pacific routes?

 

[Winglet]

I agree. Any kind of acqusition/merger or whatever it theoretically could be called, just ain't in the cards. The integration problems would make the black-hole of the TWA asset acquisition look like a picnic. Carty was stupid and conceited. I don't think Arpey is. I think Arpey realizes what a collosal blunder acquiring TWA was, when AA could have bought selected assets at the Chapter 7 firesale a couple of months later instead of the whole mess at once.

Buying some Pacific routes from UAL would make economic sense for AA. With so many people from both companies layed-off, the employee integration would be a bloody mess, especially since UAL is not days away from liquidating, like TWA was.


Skyliner wrote: "Fact: The only reason that TWA was a loser is because it allowed AA to force the bankruptcy as a condition of the acuisition. We were not in bankruptcy until AA came along to "rescue/destroy" us."

That's funny, I talked to a TWA ALPA Union official a couple of days before the announcement and he told me that in a couple of days, nobody was going to sell TWA fuel and the lights were going OUT. He was happy as a lark. I wasn't, cause I knew that TWA was going to be an albatross around our neck.

 

[L1011Ret]

That is funny too because a member of the TWA BOD has attested to Senator K. Hutchinson that TWA had $150+ million in the bank on January 10 and was not about to shut the lights out. At various points in time TWA had gone down to $5 million in the bank. Was TWA in trouble? Certainly, but not as dire as those who wanted the merger to go through would have you believe.

 

[luvn737s]

If airlines (especially ones who control over 10% of the market) feel they can't raise fares to cover their costs, why don't they close up shop and get into a more lucrative line of work? There is little difference between a merged entity of two or three large airlines and how the industry as a whole operates now. An airline who can't raise it's fares because of a lack support for that fare increase among competitors is operating in a defacto oligopoly.

Why do consumers feel entitled to a $69 fare to anywhere in the world? Because some airline feels they can gain market share by providing unrealistically low fares. And maybe they will gain share, but in a market they have trained to demand below-cost fares. Those who have polluted the water soon find that it is their drinking water source too.

So I do not pity the airline industry that pounced on the opportunity provided by the tragedy of 9/11 to rid themselves of union contracts only to find that eviscerating labor couldn't save them from a lack of strategic vision. Labor has become the whipping boy for a mistake that has ultimately cost the industry it's pricing power: internet distribution through the likes of Priceline, travelocity and others. There is no need to put any fare out there other than the match to the lowest one (hello, ever heard of yield management?) so they do and then try to build an operation that can profitably provide such a fare. Alas next week some airline moves the benchmark lower and the whole concept of profitablity goes out the window.

Now we have an industry that has no new ideas, no more labor concessions at the well and bemoans the scourge of overcapacity. Hoping for an airline or two to fail to reduce capacity is like the homeless guy whose only hope is a rich old aunt dies and leaves him something. Until the industry decides to revisit the laws of economics and behave logically, then aunty is alive, vibrant and kicking their ass.

So while employees continue to suffer the pain and uncertainty of an industry turned upside down and whose sacrifices go unnoticed and unappreciated by a consumer population that has no idea what a fair fare looks like, the investors in the airline industry (are their any left out there besides day-traders) would be better served by pulling support out and letting the industry collapse on itself. If the airline system, which was regulated and subsidized for 40 years in order to be built into a strong pillar of our nations infrastructure, cannot recognize the pricing power it holds as a result of virtually no existant competition from other modes of transportation, then there is little hope that it can exist for another 40 years, perhaps not even another 40 months.