United for sale

[chucky]

Me thinks nobody is buying nobody...

If anything, the second tier airlines might be the ones...

With the carriers making $$$, lots of fare increases, oil down, and the Bush Adm. on the ropes, sure don't make sense to me to expect legacy mergers.

IF, a big if, that was to happen, expect the Bush Adm. to change the 25% ownership rule for foreign airlines...

Parker talks...and talks...Are we not in negotiations? That little carrot is a great weapon(Ahh, mergers, B747, B777...foreign lands ...and especially given one of our own pilots, USA320Pilot, helping Parker keeping this alive...

Just don't see it, not the legacies, anyway...
SoftLanding

Totally agree.

 

[JungleClone]

Soft Landing,

Let's keep one thing in mind. Oil is only down in price due to the upcoming elections. I guarantee you that once the mid-term elections are over, you'll start seeing oil trickle back up in price. It's price/market manipulation, plain and simple. This is nothing new.

In terms of mergers, when you have a CEO like Glenn Tilton doing everything short of publicly begging for someone to merge with UA, it tends to put added pressure on the desire to "do a deal". And let's also remember that this is not necessarily an industry known for making decisions that are based on economic and fiscal sanity.

I'm the first person to say that mergers suck. No ifs ands or buts about it. They are extremely costly and painful, especially for employees. The only ones who cash in on mergers are the executives, Board of Directors, and short-term investors/lenders. But, I think that given the geo-political picture, which dictates many variables for the airline industry, such as demand for travel (especially overseas) and oil, I think you have to project many years down the road to see that consolidation is going to be forced upon this industry at some point. Why do I say that? The big reason is oil.

There is only a fixed amount of oil in this planet's resources. There is a great deal of evidence to back up claims that we have reached the point of peak oil production and that it's going to go down hill from here. Many will try to dispel that notion and scream about newly discovered oil fields. But also bear in mind that the Ghawar oil field in Saudi Arabia is the world's largest. The Saudi's continue to say they can step up production to keep prices in check. But they never do. And they refuse to allow independent audits of their publicly stated reserves. Many oil experts believe that the reserves of Ghawar are nowhere near as high as stated by the Saudis. My point is that you cannot trust oil industry executives when they tell us that supplies of oil are fine and that everything will be A-ok. We will eventually reach a point where the global demand for oil far outpaces the available supply. Many believe we're at that point now and that the oil companies are doing everything they can to mask it. Whether we've hit that point now or not isn't really the point. The point is that it is going to happen. And when it does, the impact will be devastating.

So in terms of that alone, I think the prospect for airline mergers becomes more real simply out of necessity for survival down the road. Try to think not just in terms of the next couple of years. Look out much further. The need for consolidation is real, despite how painful it is for everyone. I think time will prove that notion 100% correct as events unfold around us.