Parker makes low-ball offer to AMR creditors to merge US with AA

[wings396]

Thanks for your usual boost of confidence. In another post, didn't you claim to be supportive of this merger?

 

[TWU informer]

In my opinion, reduction in capacity, new logo, brand, livery, new Board of Directors, and the concessions gained from employees, the merger and the rest could well be the turn around we have hoped for years now. May not be good for select groups of individuals in some areas including myself and my tulsa coworkers, but could be a great change for the Airline.

 

[Real tired]

If I start collecting my pension at 55 I will get around $25,000/year. I no longer use AA's medical and our pension is frozen.
Working for AA as a toped out mechanic I'll be earning around $70,000. So after I reach retirement age I'm basically working for $45,000 a year. So if I left AA I would only need to earn around $22/hr to make what I',m making at AA. Anything more than that and I'm ahead. Some people may say "what about all the PTO you earn after having all those years. Well our PTO sucks.

That rate is about twice as much as a 35 year Mechanic at US. If I could earn 25 G's on my pension, I'd been gone some time ago.

See, you guys aren't doing so bad after all............................. That is until we merge.

 

[777 / 767 / 757 Love]

Thanks for your usual boost of confidence. In another post, didn't you claim to be supportive of this merger?

My usual boost of confidence? Hey, I tell it like I see it, and require nobody to agree with me.....I think as always, people get caught up in "bigger is better". To them I say, if this is true, please explain SWA and B6's success? Also, someone please run the US Air numbers with AA's new labor costs, you will find US Air's profits would be much smaller. Its easy to run a profitable company off slave labor rates......

Btw, I NEVER said I blindly support a merger. What I said is I felt so bad for Alliance and believe a strong Alliance and Tulsa could mean good things for AA if they were leveraged properly (like doing maintenance for other companies not just AA) and that I would almost support a merger if it meant Alliance would stay open. So, I'm not blindly attached to one side, I just think overall US Air brings the southeast to the table, but that does not outway the issues she brings.

I also think Horton has not been given a fair chance, people are grouping him in with people like Brundage that they have grow (a rightly so) to loath. He really did a good job with AT&T, I know former executives and lower level employees there (rescent ones) that speak VERY highly of that that company. I think AA employees have enough problems as it is without bringing the labor issues at US Air into the picture. I think Parker's track record with labor is no better than ANY current AA management team member, and he clearly shows his incompetance in building a route structure. He has developed a domestic airline, passed up oppurtunities to expand into China and has based his entire plan on finding a company with an international presence to do what he couldn't do. He struck out twice already and knows this is his last shot.

I just think a huge fleet order, new livery, new contracts and control over the appointment of a new board and management team would give AA unions exactly what they need to re-shape AA in their image. A stand alone plan means the unions along with the UCC get to sit back and pick a board and maagement team that they feel will be more equipped to lead AA, while a merger placing Parker in control is just more of the same old same old, with heavy losses during the merger period that may not result in much added value. Maybe together the unions and UCC can grab some outside of the airline industry to infuse new ideas and blood into AA, or at least to infuse a team that can better execute the existing plan. Either way, unions would have control over the leadership at AA.

Finally, as long as this is an all stock deal, I can tell you no analyst or PE group worth a DAMN would take this deal. EVERYONE knows stock value of the combined entity might never be worth much of anything, especially if the company bleeds during the merger process while a stand-alone AA I think will do well enough that over the next 10-years investors will get their money back and then some. I think the only way this merger happens is if UCC gets offered a boat load of cash. I spent time on the street, and had some great mentors there, as well as many still working there, and everyone worth a damn says the same thing to me over a beer: without a huge cash component, UCC is smart enough to tell US air to go pound sand, and I think the APA contract now allows managment to provide the facts and cost certainty to sell their plan. I know most will disagree with me, but I stand by my conclusion.

Sorry Wings for the long response, don't think you were asking for another lengthy opinion, but I gave it anyway......if you read the whole thing, thanks🙂

Cheers,
777 / 767 / 757

 

[wings396]

Read it all, realize everyone has the own opinion.

 

[WorldTraveler]

opinions, yes... but he does show that there are very real economic obstacles which US has to overcome in order to be successful in a bid. There is little reason for any investor to accept an all-stock deal with US just when AA comes out of BK w/ the tools necessary to compete as good as if not better than US. Add in that AA has a stronger brand and is the larger carrier and the deal makes alot less sense.
You are in essence trading stock and taking on a whole lot of risk in the merger.....few investors would find that an appealing proposition and it isn't just about US or any other airline.

If US doesn't put some of its own money into the deal, which they will be hard-pressed to do because they are so leveraged, AA will likely continue down the path of emerging independently.

Those are just the business realties....

 

[jimntx]

Thanks for your usual boost of confidence. In another post, didn't you claim to be supportive of this merger?

You're coming across as someone who is desperate for the merger more because you think that LCC will not survive without it, than because you think it is the best for both airlines. Not judging. Just saying.

 

[wings396]

Would I like to see it happen, Yes. Am I desperate, No as I will be retired before a merger would ever be completed anyway. I have been in the industry for a long time, and have been involved in 3 mergers up to this point. Some good, some bad. Given the sheer size of DL & UA, I feel that it will benefit both AA & US to team up in order to be in the same league as the others. Should US fade away in a few years, flying perks are all that will be lost on my end. The pension is with the PBGC, no medical bennies, so no real dependancy on the company once a person retires.

 

[WorldTraveler]

US is not likely to just dry up and blow away.... PHX is a decent enough hub in the west that it will be retained until something better can be used to serve the region.

PHL, DCA, and CLT are valuable hubs and they will be acquired by someone before they are folded up - although it is possible they could be carved up among several players.

In the meantime, US will continue to build its network and find a niche for itself but they will not be able to compete on the same level as the big boys. But US has clearly proven it can find a niche - even as a low fare network carrier - and succeed in that niche.

AA and/or UA could be interested in one or the other and it is still possible that AA could acquire US lat.er on - but on AA's terms and once AA has emerged w/ all of the things that go w/ emerging as a standalone.

You don't need to worry about losing the pass benefits...

 

[Bob Owens]

You're coming across as someone who is desperate for the merger more because you think that LCC will not survive without it, than because you think it is the best for both airlines. Not judging. Just saying.

I'm guessing that for some USAIRWAYs employees mergers are simply a way of life. They may have worked for several carriers over their careers without ever leaving any of them. They may have started with Mohawk, then Allegheny, then USAIR.

 

[wings396]

That's correct, I have said many times that I don't care what airline name is on my check, as long as I get one. I've gone thru a multitude of uniforms over the years as well. Being a loyalist to any company is difficult to do anymore once you come to realize that you are disposable to them.

 

[Bob Owens]

That's correct, I have said many times that I don't care what airline name is on my check, as long as I get one. I've gone thru a multitude of uniforms over the years as well. Being a loyalist to any company is difficult to do anymore once you come to realize that you are disposable to them.

You are right. When executives arent loyal why on earth should the rank and file be? Horton left, came back, brought us into BK and within a year or so he will be gone again, with millions from our pockets.

 

[AAviator]

Bob, Arpey brought us into BK.

The AMR BOD asked Arpey to stay on and work the restructuring.

If anything, it should serve as a reminder as to why the BOD needs to be replaced.

Get your facts right.

 

[TWU informer]

The real facts are not even visible to the peasants.

 

[Flying low]

Bob, Arpey brought us into BK.

The AMR BOD asked Arpey to stay on and work the restructuring.

If anything, it should serve as a reminder as to why the BOD needs to be replaced.

Get your facts right.

And from what I have heard Arpy was our only "ally" we had in Dallas.