Ual Ceo: Us Skies Need Deregulation

[KCFlyer]

Not that I disagree with the above statement but taken in context of earlier ones...you say Ual shoulnd't even be around today. Fine. But then you have to go back and wipe out every other airline that had entered BK before us. Some even twice or more (Continental, TWA, USAir, Braniff)

Don't you think if those carriers had ceased to exist rather than restructure, UAL might never have had to go BK in the first place? (same for Delta or Northwest)

DC

[post="305154"][/post]​

As I said - in a fully deregulated market. That means that the other airlines who were operating in bankruptcy while leveling the playing field were a drag on the otherwise healthy competitors...even if that competition only served to weaken those other carriers. IMHO, had the bankruptcy courts not been used in the past, the face of the US aviation industry would be a lot stronger than it is today. Hell...they way I see things happening now is that before long Southwest, JetBlue and Airtran will be operating in bankruptcy so that the playing field is truly level. They might as well just reregulate.

 

[C54Capt]

Are you sure about that? Several financial analysts are saying Delta may never emerge from BK. They say Delta may have no choice, except to go Chapter 7.

[post="305047"][/post]​

Are these the same analysts that said UAL would be Chapter 7 more than a year ago? Granted, Delta has a much leaner environment to compete in due to evolution of the industry economics over the past three years, but they will most likely survive via consolidation.

As far as deregulation goes, one can argue about the what ifs all day long. Simply put, the only fair way going forward is either to completely regulate or completely deregulate the industry unlike the quasi-regulated environment we currently operate in. In the latter scenerio, the industry would certainly become a profitable one served by no more than three airlines (IMHO).

 

[Ukridge]

After a quite a spell away, I was rather bemused by turning first to this thread and Mr. Tilton's remarks regarding consolidations. Particulary marked were his implications of the need for trans-border agreements. If I may so humbly introduce the term that is extant here across the large body of water - 'fusion.' Air France and KLM always speak of their arrangement as such and I must say that it has a rather nice ring to it. The term 'merger' seems to be a somewhat brute force with more hope and promise than assurance of benefit, while fusion beseaks common effort toward a goal. Just something to think about.
Though I would much like to, I certainly cannot lay claim to being the originator of the idea of a LH/UAL/other.... 'fusion' in its own right. After the AF/KLM linkup, the air was full of rumours being floated that this is what LH would like to do with one or more of its partners. I have always thought though that the Star Alliance was merely the foundation for MUCH deeper and broader cooperation. Naturally one in the FCs tends to think of United's travails, but LH has had its share of jacknapes nipping at its heels as of late - pressures that may force it to look at these 'unique' relationships. The aforementioned AF/KLM adds to the calculus, but also the emergence of Emirates. This 'over-the-horizon' threat has merited numerous public remarks by the LH chief.
Ukridge would humbly opine that the real money may not be from Bristol to Birmingham any longer (a phrase that can be applied to your respective domestic saturated markets) but rather among the world's emergent economies and the 'old' world (to include North America). The Star Partners with LH and United at the fore most certainly wish to be part of this. This obviously is nothing new, but the trend seems to be recognizable now.
My opinion only FWIW.
Cheers

 

[Bear96]

Welcome back Ukridge!

I have missed your postings.

 

[Ukridge]

Well thank you Bear!

 

[The Gopher]

Someone posted a concern about using foreign-based labor to fly on US-domestic routes. Sorry, but this ain't gonna happen.

Tell me, who works at the BMW dealer in LA? Not a bunch of Germans. Or who runs the local Dutch-owned gas station named Shell? Not a guy from Rotterdam. It will be like any other global-based business, the franchise will be licensed in the foreign country, and will have to use local labor.

Tilton believes that, like oil and auto companies, borders should be opportunities, not restrictions on the business. Think of Daimler-Chrysler and British Petroleum. Imagine that if United wants to start flying FRA-NRT or SYD-BKK, we have a locally-based subsidiary that operates the flight with local labor. Now, that may irk people by using foreign-based labor instad of US labor, but the profits go back to United in Elk Grove. Similarly, foreign-based capital make for a much more stable system of financing, especailly in the amounts required by large global carriers.

See here for more, said much better:
http://www.united.com/speech/detail/0,6862,52876,00.html

 

[The Gopher]

Another:

http://www.kellogg.northwestern.edu/news/h...021222ctrib.htm

 

[jimntx]

Welcome back Ukridge!

I have missed your postings.

[post="305306"][/post]​

May I add a resounding second to that sentiment! Now, perhaps we can once again have literate discourse on the issues facing the airline business instead of the TWU-IAM-AMFA sniping that has taken over the boards lately.

 

[JungleClone]

Borescope,

Fuel. That's the answer to your question. DL and NW won't have the luxury of putzing around for 2-3 years if fuel prices continue to rise, as they're expected to do. The pressure will simply be too great. Creditors won't have the luxury of being patient. In the end, labor cost cuts, restructured leases, reductions in debt and pension obligations only get you so far because you can only cut so much before you achieve diminished returns. Revenue must be leveraged upward. And the only way that happens is to eliminate some competitors. Consolidation will be a matter survival and every airline CEO knows it. Fuel is the ultimate equalizer.

Timing is everything. And very shortly, UA will be in the driver's seat in terms of looking for strategic opportunities to ensure their survival.

 

[Bulscu]

Borescope,

Fuel. That's the answer to your question. DL and NW won't have the luxury of putzing around for 2-3 years if fuel prices continue to rise, as they're expected to do. The pressure will simply be too great. Creditors won't have the luxury of being patient. In the end, labor cost cuts, restructured leases, reductions in debt and pension obligations only get you so far because you can only cut so much before you achieve diminished returns. Revenue must be leveraged upward. And the only way that happens is to eliminate some competitors. Consolidation will be a matter survival and every airline CEO knows it. Fuel is the ultimate equalizer.

Timing is everything. And very shortly, UA will be in the driver's seat in terms of looking for strategic opportunities to ensure their survival.

[post="305410"][/post]​

ual will be merged into cal...

 

[Busdrvr]

ual will be merged into cal...

[post="305424"][/post]​

WADR, if it happens, it would be the other direction, and after you lose your pension.

 

[NewHampshire Black Bears]

WADR, if it happens, it would be the other direction, and after you lose your pension.

[post="305449"][/post]​

+++++++++++++++++++++++++++++++++++++++++++++++++++++

Well I for one think/hope, and urge, that the invitations for the UA/CO nuptuals are in the mail VERY SOON !!!!!!!!!!!!!!!!!!!!!

h34r: h34r: h34r: h34r:

NH/BB's

 

[Bulscu]

ual will be merged into cal...

[post="305424"][/post]​

You're in for a shock sweetie...


in more ways than one.

 

[Busdrvr]

You're in for a shock sweetie...
in more ways than one.

[post="305480"][/post]​

Well "sweetie", you need to come to a realization that just because your company "wishes" something will happen, doesn't make it so. And I do know the garbage that your management has been telling the employees behind closed doors.

 

[Bulscu]

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