WHAT IF??? What if US (who is not in BK) switched rolls very quickly and did a merge with B6? Would that make the combined US/B6 a sizable competitor to AA and both of them could compete well against DL and UAL. Just a thought as I have seen no one throw this one around, it's all about AA and B6. Would the US/B6 merger be easier to get approval for? And as I have always said, Alaska would be a very good prospect to merge with, just thinking out loud here...
Time for AMERICAN to persue....JET BLUE !
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robbedagain
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to be honest swamt b6 and us could work but i do believe they fly for the most part to the same cities we fly too their aircraft and ours are compatible... i personelly dont see b6 or as merging with anyone at least now.. as would help bring more for us on the west.. i do wonder if us would still go ahead and leave star and join one world and may be get interline going at least with middle east carriers i do think we have at least one but not 100% sure on that though
OP
NewHampshire Black Bears
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Kudos....swamt !
Excellent question (US/B6),...and I for one have Always liked the Idea of AA and AS, for 2 very good (if not More) reasons.
First, they're a $$$ maker, have a lot of young aircraft, are the ONLY game-in-town north of SEA and the Best reason..IMHO...is that you gain SEA as an international west coast hub while Still making money despite the potential foreign flying that could be done out of SEA.
Obviously, DFW/ORD and LAX (for AA) can support thier own NS flights to Aisa, but consider this.
Lay flat a world map, and draw the straightest line from east of the Mississippi to China, Korea, Phillipene's (SP?) or Japan.
The shortest/straightest line one could draw from up and down the east coast, is NOT via LAX or SFO. It's via SEA.
Maritime shipping uses this exact routing for ALL of it's 'east of the mississippi' shipping, because it CLOSER through SEA = less fuel burn $$$$.
In addition swamt,...take a 'good look' at SEA TAC airport (map) (portseattle.org).
The main terminal is divided into a N-S configuration...with gate areas..A - S (outh) -B....and C - N (orth) - D. AS has ALL of the north side....C - N - D, with ALL of C + N. In D, the ONLY other tenant (in D ) is 'yours truly' AMERICAN ! (with one lone gate for B6). EVERY other airline, foreign or domestic was intentionally placed on the 'Other side' away from AS ! Coincidental ??......Knowing AMR (back then) I doubt it !
jetBlue told Horton that it was not interested in merging with AA. Once AA emerges from Ch 11, AA could try a hostile takeover of B6, but that would likely involve a hefty premium to the current share price. Does B6 really deliver the right customer base to AA to help close the gap between UA/DL and AA? I don't know.
Alaska? I believe that Alaska laughed at the notion of merging with AA. AS is a very valuable company (market cap is near $4 billion). Like B6, I suppose that AA could attempt a hostile takeover, but that would be expensive. And other than the strength in SEA, SJC and LAX (plus the state of Alaska), would owning AS bring AA strength in areas where AA needs some more strength? I don't know.
SEA-Asia is a good point, as it minimizes the huge inefficiency of burning fuel to carry fuel for ultra longhaul flights, but Delta beat AA to the punch. A couple years ago, MAH4546 posted here and elsewhere that he predicted that AA would begin SEA-NRT/PVG/PEK etc. Turns out that DL is doing that right now, plus HND and maybe HKG. Delta is now huge in SEA-Asia flying. If AA acquired AS, that would remove the helpful feed provided by AS, but would that matter?
I don't think NYC or BOS or WAS or PHL business travelers would prefer connecting in SEA on their way to Asia over nonstops from their cities, so JFK-Asia and IAD-Asia and BOS-NRT will remain. Don't know if stand-alone US will ever fly to NRT from PHL, but maybe it will someday.
I don't see AA merging with or buying either B6 or AS. Codesharing with them? Sure. Acquiring them? I doubt it.
Alaska? I believe that Alaska laughed at the notion of merging with AA. AS is a very valuable company (market cap is near $4 billion). Like B6, I suppose that AA could attempt a hostile takeover, but that would be expensive. And other than the strength in SEA, SJC and LAX (plus the state of Alaska), would owning AS bring AA strength in areas where AA needs some more strength? I don't know.
SEA-Asia is a good point, as it minimizes the huge inefficiency of burning fuel to carry fuel for ultra longhaul flights, but Delta beat AA to the punch. A couple years ago, MAH4546 posted here and elsewhere that he predicted that AA would begin SEA-NRT/PVG/PEK etc. Turns out that DL is doing that right now, plus HND and maybe HKG. Delta is now huge in SEA-Asia flying. If AA acquired AS, that would remove the helpful feed provided by AS, but would that matter?
I don't think NYC or BOS or WAS or PHL business travelers would prefer connecting in SEA on their way to Asia over nonstops from their cities, so JFK-Asia and IAD-Asia and BOS-NRT will remain. Don't know if stand-alone US will ever fly to NRT from PHL, but maybe it will someday.
I don't see AA merging with or buying either B6 or AS. Codesharing with them? Sure. Acquiring them? I doubt it.
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NewHampshire Black Bears
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Well truth be told FWAAA, I have NEVER feared DEL-DUH from Anywhere, minus ATL. AA just needs to get thier Head out of thier ASSS, and be the aviation 'street fighter' ....AGAIN.......that Crandall made them into, not so long ago !!!!!!!
One other thing. Singapore is Ending thier heralded ultra long haul flight from EWR to Singapore.
My point being, that JFK/EWR/IAD non stop to Asia ? Japan ..Yes, ...mainland China or beyond ..NO.
And my 'thinking'...MAY be why there are no NS flights to places like (soon) Singapore, or (never) Bangkok, Beijing, PVG etc, by any US carrier. There appears to be a razor thin line where too long of a flight doesn't work. (Again.....EWR/Singapore).
Back to AS for a second please.
Lets not forget that WITH AS one gets Horizon.
WorldTraveler
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DL's very decisive moves in expanding SEA was undoubtedly in part to ensure that DL had a west coast gateway to Asia that it could call practically all its own. SEA is well on its way to offering as many destinations as UA has from SFO; it is only because DL uses smaller aircraft that the size of SEA is smaller than UA at SFO.
And it is highly unlikely that any carrier will succeed at challenging DL in SEA; UA is struggling to keep its SEA-NRT service alive while DL is throwing tons of capacity into the market.
DL has made it clear to AS that DL really ISN'T going to rely on AS' feed to make the hub work. DL has added a number of flights to SEA and LAX this summer and all indications are they are doing well.
Specific to the question of AA finding a place to grow on the west coast, there aren't a whole lot of options.
And it still doesn't change that AA's weakness to Asia overall makes adding flights even more challenging.
It also doesn't change that there are market concentration issues that the DOJ would undoubtedly consider involving AS and B6 that would likely detail either merger.
Bears,
AA dropped its JFK-NRT flight due to average fares that were well below DL and UA. They added JFK-HND and have asked permission to move the flight to LAX because AA's average fares on JFK-HND are even worse than they were to NRT. The DOT denied AA. AA is still the smallest of the big 3 US carriers from NYC, add in AA's weakness to Asia and the chances of AA succeeding on any route from NYC to Asia are very, very slim.
AA needs to figure out what CX wants for a JV and tap into their strength. And for some reason, there was a little bit of movement on AA's average fares to Japan that helped a little but left them short of what DL and UA get on competing routes to Japan; AA needs to figure out why they can't get higher average fares to Asia with or without a JV.
eolesen
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Nobody wants an 18 hour plane ride, and the only way EWR-SIN worked was load restricting the A345's to just 100 business class seats to get the range. That didn't work, so now they're returning those five aircraft back to Airbus.
I'll also disagree on mainland China. I've been on an assignment working there over the past few months, and it's definitely not your Chairman Mao's Buick anymore... The growing middle class there already outnumbers the total population of the US, and as they travel more and more, it's going to be hard to keep up with the demand. I'm not a fan of the A380, but it just may be the right airplane for serving China, and all three of the major airlines there will have them.
The sticking point right now is that the Chinese carriers can't keep pace due to the airports and airspace. There's also the issue of visas, but that's a topic all on its own... Until then, they'll chose places which are arguably more accepting of the tourism dollars than the US is. Our loss is Japan and Singapore's gain.
Once China figures out the infrastructure issues, the gates will open a little wider. Until then, they're going to keep protecting their carriers.
I'd also look for one of the Chinese carriers to perhaps change alliances, so that they're tapped into all three of the alliances. Right now, they're missing out on oneworld, and with both Japan and Australia being large mid-haul markets, at least one of the airlines currently in Skyteam might want to reconsider if it's better to have a share of that traffic, or to continue seeing dilution due to having one of their competitors getting reciprocity on the FFP benefits.
I'll also disagree on mainland China. I've been on an assignment working there over the past few months, and it's definitely not your Chairman Mao's Buick anymore... The growing middle class there already outnumbers the total population of the US, and as they travel more and more, it's going to be hard to keep up with the demand. I'm not a fan of the A380, but it just may be the right airplane for serving China, and all three of the major airlines there will have them.
The sticking point right now is that the Chinese carriers can't keep pace due to the airports and airspace. There's also the issue of visas, but that's a topic all on its own... Until then, they'll chose places which are arguably more accepting of the tourism dollars than the US is. Our loss is Japan and Singapore's gain.
Once China figures out the infrastructure issues, the gates will open a little wider. Until then, they're going to keep protecting their carriers.
I'd also look for one of the Chinese carriers to perhaps change alliances, so that they're tapped into all three of the alliances. Right now, they're missing out on oneworld, and with both Japan and Australia being large mid-haul markets, at least one of the airlines currently in Skyteam might want to reconsider if it's better to have a share of that traffic, or to continue seeing dilution due to having one of their competitors getting reciprocity on the FFP benefits.
WorldTraveler
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It's a shame that SQ didn't buy the 777LR because if they did they would still be operating the flight and have carried a full 275 or so passengers plus cargo.
China is an enormous market and it certainly has infrastructure problems due to rapid growth but there are still good slots to be had in key airports.
Remember also that US airlines still serve just two airports in a market that, as you note, is enormously large. There is plenty of space at secondary Chinese as long as US carriers have the right hub and feed and the ability to succeed in the primary markets as a platform for growing into the secondary airports.
With all due respect, DL and UA are having no problems with being profitable on their current China flights and thus they will continue to grow their.
AA's best bet for profitably growing in China is from DFW, a route AA wanted to do years ago but met resistance from its pilots so AA dropped that idea and started an ORD-China route which has underperformed relative to UA from ORD and DL at DTW ever since.
AA needs to focus on what it can do well - which right now is DFW and DFW can support plenty of profitable int'l flying all over the world.
China is an enormous market and it certainly has infrastructure problems due to rapid growth but there are still good slots to be had in key airports.
Remember also that US airlines still serve just two airports in a market that, as you note, is enormously large. There is plenty of space at secondary Chinese as long as US carriers have the right hub and feed and the ability to succeed in the primary markets as a platform for growing into the secondary airports.
With all due respect, DL and UA are having no problems with being profitable on their current China flights and thus they will continue to grow their.
AA's best bet for profitably growing in China is from DFW, a route AA wanted to do years ago but met resistance from its pilots so AA dropped that idea and started an ORD-China route which has underperformed relative to UA from ORD and DL at DTW ever since.
AA needs to focus on what it can do well - which right now is DFW and DFW can support plenty of profitable int'l flying all over the world.
Not sure what your point in all this is but I agree companies can be successful with unions on the property but is up to both management and the union to reach flexible mutually beneficial agreements (see WN), but for the most part unions add onerous workrules that effectively price themselves out of doing work.
Josh
AA will be the last stand alone legacy.
JetBlue is a airline that has a New Yorker flair..Tough most times, gentle others...but always straight to the point, like taking a cab ride. (For those of you hicks from the sticks.. A cab is a taxi..)
I don't fly B6 because they are non-union, but they've made it in NYC and so I applaud them.
JetBlue has a home in the Apple ( you can take the 7 train to their corporate HQ ) and NewYorkers like that.
So forgettaboutit...now give me a dog with the works... I've gotta go.
JetBlue is a airline that has a New Yorker flair..Tough most times, gentle others...but always straight to the point, like taking a cab ride. (For those of you hicks from the sticks.. A cab is a taxi..)
I don't fly B6 because they are non-union, but they've made it in NYC and so I applaud them.
JetBlue has a home in the Apple ( you can take the 7 train to their corporate HQ ) and NewYorkers like that.
So forgettaboutit...now give me a dog with the works... I've gotta go.
Thank you for not flying on non-union airlines. I also don't fly on non-union airlines. A side note, WN is the most highly unionized airline there is and it just pisses me off when the experts on tv say " the unions are killing the airlines". WN has posted a profit every year.
1airborne
A lot of intewebs dweebs whine incessantly (usually on Flyertalk) that AA's Asian network will forever be inferior until AA flies its own metal to SIN, BKK, and other very distant destinations. Of course, as you point out, those flights are probably on the wrong side of the viability line to be flown nonstop from any mainland USA gateway. And, quite obviously, unless the Japanese build some new runways near Tokyo, AA will never duplicate the JAL hubs in Tokyo. Some of those far-flung Asian destinations may always be one-stop flights via NRT or HND. Many of those interwebs dweebs I'm talking about are thinking about just one thing: using their systemwide upgrades on those flights as right now, we can upgrade only on AA metal to Asia (which means China, Tokyo or Seoul) and then if on a cheap econ fare, ride in the back of the bus on the NRT-Final Destination flight.
I just don't see AA merging with AS. It seems to like the life of the single girl. And its market cap is very high.
WorldTraveler
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AA acquired TW not that long ago; standalone is not an accurate assessment whether AA merges with anyone this round or not.
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NewHampshire Black Bears
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Now if AA WERE to pick up AS, then they could run ALL thier Eastern seaboard Asian flights from an..ANC..gateway.
That would be some thing to see !
That would be some thing to see !
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