RUMOR ALERT: US/UA merger "inevitable"...

[Art at ISP]

Newsweek Quote .... "Despite the challenges, a number of industry watchers aren't ready to count out Parker, who is considered one of the best financial minds in the business. "If Doug went to Wall Street to raise capital for a new airline, he'd have $1 billion in commitments before he got to the end of his [PowerPoint] deck," says Robert W. Mann, an airline industry consultant."

Any CEO who publicly states his contempt for his customers (he said he didn't understand why the airlines spent so much time on customer service) and who has driven away such a large group of formerly loyal customers should not be in that position at ANY company.

If he's so good at finances let him be CFO, and keep him away from customers and the press....

Larry Kellner runs rings around Doug Parker by just about ANY measure.

LD3, I happen to agree with you--no one is going to be happy here.

And I doubt it would be one acquiring the other except on paper--two weak parts don't necessarily make a strong whole....

My BEST to you all.....

 

[back2CLT]

Finally, a few months ago Scott Kirby told employees at a Crew News session that ...... US Airways would ...... become "deeply embedded" with United.

And that's where it will end. Why take on mountains of debt, disparate fleet, and disgruntled employees if you can achieve similar operating savings without the hassle?

Roll reservations for both airlines into one out-sourced group, increase purchasing power from vendors, re-allocate routes to be complimentary rather than competitive. There is still plenty that could be done to streamline the operation, but ultimately, I don't see how a true merger is going to work. Too much debt, not enough revenue. Improving yeilds by drawing down capacity is great, but when you need income to pay debt, yeilds are secondary.

Once the economy turns around, then you can plan a true merger. DL/NW only worked because DL had just come out of bankrupcy and NW was still in it.

 

[john john]

http://web.archive.org/web/20010825225658/...gerbriefing.htm
CWA Notes of US Airways Management Briefings of the proposed merger between US Airways and United
Here is a little history lesson on what went down January 2001. Some of the new comers(HP) and some who need there minds refresh

 

[OTslave]

If he's so good at finances let him be CFO, and keep him away from customers and the press....

Truer words were never spoken Art.

 

[usa1]

And that's where it will end. Why take on mountains of debt, disparate fleet, and disgruntled employees if you can achieve similar operating savings without the hassle?

Roll reservations for both airlines into one out-sourced group, increase purchasing power from vendors, re-allocate routes to be complimentary rather than competitive. There is still plenty that could be done to streamline the operation, but ultimately, I don't see how a true merger is going to work. Too much debt, not enough revenue. Improving yeilds by drawing down capacity is great, but when you need income to pay debt, yeilds are secondary.

Keep them separate ..... move valuable assets from UA to US or US to UA .... which ever .... then let the other go to chapter 7. That's what Continental did to Eastern ..... I think that's against the law now.

 

[Glucose Intolerant]

The only way a merger goes through is w/ Parker in charge....It's all about his inflated ego and nothing else..If he honestly cared about running an airline he would have his own house in order, how is he capable of bringing UA into the fold and making it work..It will be a labor disaster!!

Spot on

 

[TheGreatOz]

Merger and Venting.

America West went after USAirways and seriously underestimated the East coast mentality, they were caught with their pant all around their ankles and each of the Sandcastle boys holding a nine iron in one hand and patting each other with the free hand for a job well done and they didn't have a clue as to what they were doing. AWA middle management told the Sandcastle exactly what they want to hear instead of what was going on. Gee I guess that never happens any where else does it? It was a fricken diaster and it still is.

Many posting here went through the AWA-US merger but not one will speak the truth. AWA did not do full diligance nor did they understand the "culture" of the East Coast, where the morals and attitude are" I have been here 30 years and you owe me " AWA did not know how to handle that and they still don't. Sandcastle quietly hopes it will go away. Anyone go to Crystal City and see the hundreds of thousands of dollars of Artwork that was thrown in the trash or loaded up in personal cars, because East people were not getting their fair share when the merger was announced?

Sandcastle was not prepared for the Unions either. Let's talk Pilots... East outnumbers West... including senority. Need to find a solution, both parties agree to go to the Fed's and accept the outcome. Am I right so far? Then what happens, East doesn't like what the Fed's say ( oops forget that we agreed to it, that never happened) and start their own Union...what a bunch of children. I guess you might have to give up that third home in Fla and the AWA pilots might not be able to afford that condo in Cabo... its called living within your means.

Anyone here see the HBO Special on the Closing of the GM Truck Plant.... and we wonder why that happened, well its simple GM didn't adapt and neither did its work force. GM employees have worked doing the same job for thirty years with absolutly nothing to fall back on except their believe that GM would take care of them. Guess what GM screwed up, blew their pension and popped their balloon. Is it their fault? NO Is it there fault that they have nothing to fall back on... you look in the mirror.

When the merger happens between USAirways and United, I will bet a shiney penny that we see the last of USAirways... and you know what? Good Riddence drop the brand name bury it.

Please accept apologies if I have offended anyone, it was not my intent.... I just get so tired of hearing the bull...

 

[Richard]

The above rant aside, please keep on topic of the rumored merger or transaction yet to come....

 

[SS255]

If US and UA merge and Doug Parker is in charge, the "new" company will lose the majority of its UA-based elites. Mark my words. I have been the victim of verbal backlash from UA elites when I mention my US status. The prevailing sentiment is that UA elites despise US -- perhaps a bit unfairly, but to quote Art, "perception is reality. " Tilton is no great shakes, but at least if he were to remain as CEO of the merged company, the UA elites would be breathing a sigh of relief that they ended up with the "devil that they know."

The best case scenario would be for Larry Kellner to be named CEO of the merged airlines. The next best thing would be for the BOD to bring in somebody from the outside -- preferably someone in a high level management capacity who has had proven success in both running newly merged entities and negotiating with unions -- and someone who has flown 1MM+ butt-in--seat miles as a paying customer on commercial airlines.

This person's first order of business would be to determine the best and the brightest from both airlines and align myself with these people, instead of just keeping everyone from the "surviving" entity and firing everyone else.......and refusing to integrate the best practices of both companies.

 

[leprechaun]

Too much drama. Don't care who signs my paycheck, as long as I get one.

 

[AirbusAVE]

Any CEO who publicly states his contempt for his customers (he said he didn't understand why the airlines spent so much time on customer service) and who has driven away such a large group of formerly loyal customers should not be in that position at ANY company.

Elites, elites, elites. Elites can take a private jet for all I care. I personally have silver status. But these elite people take themselves way too seriously. If an elite wants to inconvience themselves to avoid US, go for it. It's not like there is a difference between any of the legacy carriers. My flights are generally up and down the Eastcoast and last no more than 2 hours. I eat before I get on the plane. I'd suggest others do the same.

I have a 199$USD round trip from Charlotte - Newark on an US Airway's A319 tomorrow. I am very satisfied with that price! But, if you're looking for luxury, rent out a damn private jet :down: Not all of us want to pay 600$ Just so some people can have hot meals and drink out of glass and pretend their lives are all just so damn glamorous because their company pays for their tickets.

If United elites don't like the Airways way, oh well. They can take their elitist attitudes somewhere else. I quite frankly don't care how many elites leave because I don't really care if Airline XXX makes a profit or not: I'm the customer, and I personally want reasonable fares as opposed to hot meals, glass, and hot towels. Why in the hell a person would need a towel - hot or cold - on a plane is beyond me.

Besides, of the two carriers. Which airline is in more financial trouble? Obviously, the elites of United aren't helping out too much anyway, to be quite frank. And I don't think the elites of US Airways (before the HP merger) helped US Airways out much either. They obviously all flocked to Southwest's lower fares and worse product in Baltimore, according to some who insist the Airways pulled out of Baltimore because of Southwest. Not so much loyal elites, eh?

If US and UA merge and Doug Parker is in charge, the "new" company will lose the majority of its UA-based elites.

Why? What's the difference between United and US Airways, domestically?

Fee's?
Hotmeals?
Nicer F/A's?
Flights are more on time?
Cheaper fares?
Nicer Cabins?
Nicer seats?


I honestly don't know. Please, pardon my ignorance and feel free to inform me on why people would go out of their way to not fly on US Airways - as opposed to United - and would rather pay a premium to fly on United vs. US Airways.

But, if people want to go inconvience themselves, go for it.

Too much drama. Don't care who signs my paycheck, as long as I get one.

Exactley... Too much drama. As long as I get my reasonable fares, I don't really care who flies me there. I am not loyal to any company. Whoever gives me the most value for my dollars is the company who will be getting my business. :down: award points be damned. Whether it be a car company, airline, or gas station. I want the most value for my hard-earned dollars.


Besides, Virgin America or Jetblue are the only two airlines in the USA where I would pay a premium for.


I mean, damn. Elites are not la copa de la vida. Obviously, United is figuring this out in Denver pretty fast.

 

[FlyOnWall]

If United elites don't like the Airways way, oh well. They can take their elitist attitudes somewhere else. I quite frankly don't care how many elites leave because I don't really care if Airline XXX makes a profit or not: I'm the customer, and I personally want reasonable fares as opposed to hot meals, glass, and hot towels. Why in the hell a person would need a towel - hot or cold - on a plane is beyond me.

Wow, Doug and Scott do read and post here!

 

[Poug Darker]

If the two airlines merge, the name will surely be United. It will happen the same way it did with NW/DAL merger. Poof-the NW name is gone and Delta is everywhere-on jetways, gates, airplanes, the works. USAirways will cease to exist, just like Northwest (who?).
The elites won't leave, because their frequent flyer miles all say United, too.
Contrary to the post above, the Frequent Flyer Business traveler - the road warrior - DOES pay the rent and can/will make us or break us. There is a reason for the 12 comfy leather chairs up front.
Parker/Kirby have screwed up on FC/FF/Elites this time around - I doubt they'll do it again in a UAL merger. It has almost brought LCC to its knees.
And all the gnashing of teeth about labor problems don't matter. They don't matter now. Doug says that everyone is doing a fantastic job of getting the frames from A to B on time. Beyond that, he doesn't care about much else, especially the fragile egos of his serfs, er, I mean, 'employees'.
If it makes sense to merge, or if it is imperative to merge for survival (for either airline), then a merger will happen. Its that simple. Anti-trust - don't worry about it. Labor issues - who cares? The bottom line will be: $$$$$.
cheers.

 

[AirbusAVE]

Contrary to the post above, the Frequent Flyer Business traveler - the road warrior - DOES pay the rent and can/will make us or break us. There is a reason for the 12 comfy leather chairs up front.

Yeah. And how many seats are in the back behind them 12 seats? 138, eh?




If US Airways had all these elites before Parker, why did US Airways retreat as Southwest invaded their Baltimore hub?

Didn't US Airways BP (Before Parker) say that if there's anymore WN tails at Phili, US would go under? ... So much for elites paying the rent.

 

[hp_fa]

Too much drama. As long as I get my reasonable fares, I don't really care who flies me there. I am not loyal to any company. Whoever gives me the most value for my dollars is the company who will be getting my business. :down: award points be damned. Whether it be a car company, airline, or gas station. I want the most value for my hard-earned dollars.

I believe you are overlooking a few things:

1. The top elites, as a percentage, add much more to airline revenue, as a percentage, than non-elites. Art or Bob can provide the numbers.
2. If the elites poof and go away where does the airline make up the lost revenue, especially since they are charging for luggage and everything save the bathroom.
3. If the airline goes poof so does some competition, which means less capacity, which means less incentive to the remaining airlines to keep fares low (or your phrase "reasonable").

While I certainly appreciate both your desire and right to choose to fly no frills, remember that the frills do add to the bottom line.