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US-AA Merger Articles (Merged Topics)
- Thread starter USA320Pilot
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USA320Pilot
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- May 18, 2003
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- #197
US Airways And American And The Elephants in The Room
http://www.swelblog.com/articles/us-airways-and-american-and-the-elephants-in-the-room.html
http://www.swelblog.com/articles/us-airways-and-american-and-the-elephants-in-the-room.html
PITbull
Veteran
- Dec 29, 2002
- 7,784
- 456
Here's the link by Bill Swelbar that is spot on. He speaks of all the elephants in the room with this so called "takeover" that no one is talking about.
I think folks aren't talking about it because they don't know the intricate details, as he does. Mr. Swelbar is from ECLAT Consulting firm and was AFA (our) hired professional consultant that worked out our share of the cost savings giveback to USAirways during both bankruptcies. Testified on our (AFA) behalf at the BK hearings in Virginia explaining USAirways lowballing our cost savings contract givebacks.
He knows intimately well the language of the contracts both at USAPA and AFA, IAM, CWA. Read on and knows how absolutely impossible it would be to merge these labor groups togehter under one contract:
I truly believe American unions know how impossible this would be and they do not explain to their members their strategy to use USAirways managment as a hammer and leverage over their own managment heads.
and I most certainly believe USAirways management may absolutely know that this type of takeover would be impossible .as well, and is using this as leverage to get their America West and USAirways joint agreements ratified. One entity using the other for a means to an end.
read on:
http://www.swelblog....n-the-room.html
I think folks aren't talking about it because they don't know the intricate details, as he does. Mr. Swelbar is from ECLAT Consulting firm and was AFA (our) hired professional consultant that worked out our share of the cost savings giveback to USAirways during both bankruptcies. Testified on our (AFA) behalf at the BK hearings in Virginia explaining USAirways lowballing our cost savings contract givebacks.
He knows intimately well the language of the contracts both at USAPA and AFA, IAM, CWA. Read on and knows how absolutely impossible it would be to merge these labor groups togehter under one contract:
I truly believe American unions know how impossible this would be and they do not explain to their members their strategy to use USAirways managment as a hammer and leverage over their own managment heads.
and I most certainly believe USAirways management may absolutely know that this type of takeover would be impossible .as well, and is using this as leverage to get their America West and USAirways joint agreements ratified. One entity using the other for a means to an end.
read on:
http://www.swelblog....n-the-room.html
flybynite
Veteran
That's a really good article.
As your sig says... It's only your opinion and yet you seem to "absolutely know" many things and their "impossibilities". Fact or opinion?
I didn't even bother to read Swelbar's quoted article.
MIT 2009:
http://web.mit.edu/n...elbar-0616.html
MIT seems to trust him...
http://web.mit.edu/a...ww/Ab_Bios.html
Swelbar doesn't seem inclined to call himself out on his poor coverage, he edit's his blog retroactively without disclosure of conflicts or retroactive edits.
fail?
Correct me, please.
OP
USA320Pilot
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- May 18, 2003
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- #202
Why American should merge with US Airways
A deal could offer significant opportunities for both carriers.
http://money.msn.com...a0-fb293fc04dd2
AMR boasts 7.3 percent increase in unit revenues for May
http://aviationblog....s-for-may.html/
AMR Combats Merger With Improved Revenue
http://business-news...evenue/11574701
American sees increased revenue per seat mile in May on higher traffic
Passenger traffic at American Airlines and American Eagle increased in May on reduced capacity, yielding a 7.3 percent increase in passenger revenue per available seat mile, the Fort Worth-based carrier said today.
Domestic traffic increased by 1 percent and capacity increased 1.7 percent, resulting in a load factor of 85.4 percent, down 0.6 percent from a year ago.
On international routes, traffic was down 1.2 percent but capacity was reduced by 4.3 percent, resulting in a 82 percent load factor, up 2.6 percent.
All together, the company boarded 9.5 million passengers in May.
American Airlines, pilots extend talks as court ruling looms
http://www.tulsaworl...E2_Americ982083
A deal could offer significant opportunities for both carriers.
http://money.msn.com...a0-fb293fc04dd2
AMR boasts 7.3 percent increase in unit revenues for May
http://aviationblog....s-for-may.html/
AMR Combats Merger With Improved Revenue
http://business-news...evenue/11574701
American sees increased revenue per seat mile in May on higher traffic
Passenger traffic at American Airlines and American Eagle increased in May on reduced capacity, yielding a 7.3 percent increase in passenger revenue per available seat mile, the Fort Worth-based carrier said today.
Domestic traffic increased by 1 percent and capacity increased 1.7 percent, resulting in a load factor of 85.4 percent, down 0.6 percent from a year ago.
On international routes, traffic was down 1.2 percent but capacity was reduced by 4.3 percent, resulting in a 82 percent load factor, up 2.6 percent.
All together, the company boarded 9.5 million passengers in May.
American Airlines, pilots extend talks as court ruling looms
http://www.tulsaworl...E2_Americ982083
OP
USA320Pilot
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- May 18, 2003
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- #203
TWU updates negotiations for American Eagle employees
http://aviationblog.dallasnews.com/2012/06/twu-updates-negotiations-for-american-eagle-employees.html/
http://aviationblog.dallasnews.com/2012/06/twu-updates-negotiations-for-american-eagle-employees.html/
OP
USA320Pilot
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- May 18, 2003
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- #204
[sup]APA Weekly Hotline: June 9, 2012[/sup]
[sup]This is Leslie Mayo, National Communications Coordinator, with the APFA Hotline for the week ending Saturday, June 9, 2012.[/sup]
[sup]Bankruptcy Update
Labor stands strong in its commitment to our members for the best possible outcome of AMR's Chapter 11. We have no doubt that this will be achieved by continuing to pursue a possible merger with US Airways. This week, Morningstar came out with a particularly interesting analysis of the benefits of a merger and the reorganizational value of the two airlines. Here are its findings in a note as reported by Bloomberg News:
June 7 (Bloomberg) – American Airlines reorganization value of $22b through a merger w/ US Airways (LCC), $4b higher than standalone valuation, Morningstar analyst Basili Alukos said in a note this morning. Merger w/ LCC is “essential” for AMR to shrink $2b rev[enue] gap vs the industry $22b valuation would imply 73% recovery for creditors w/ impaired liabilities, incl. senior unsecured bondholders; would face 21% downside if AMR didn’t merge w/ LCC Morningstar sees LCC shareholders having 30% downside w/ no deal; sees 59% upside if merger takes place, achieves all projected synergies Morningstar sees rev. synergies $1.5b annually in AMR-LCC deal" According to Alukos, the Unsecured Creditors' are projected to recover .73 cents on the dollar with a merger and a 21% downside without one. He also agrees with US Airways' business plan that projects a synergies revenue of $1.5 billion a year with the combined airline."
The following is an excerpt from APFA's attorneys' final brief submitted to the court on Monday: "[Airline] industry analysts have responded negatively to American’s stand-alone business plan. Rodman and Renshaw analyst Daniel McKenzie concluded: “AMR’s plan to grow 20% over 5 years … is problematic … bad for AMR & the industry.” J.P. Morgan analyst Jamie Baker concluded: “We are underwhelmed with AMR’s standalone restructuring plan...” Wolfe Trahan's analyst Hunter Keay concluded: “We view AMR’s restructuring plan, founded on the idea of ‘growth and renewal,’ as unlikely to succeed.” These views reflect the consensus opinion, as explained by Analyst Baker: “Most airline’s management and clearly the majority of investors feel that American’s stand-alone plan represents a clear and present danger.”
The question is this: "Who wins in an AA/US Airways Merger? The answer is: everyone. The company will be far stronger, the employees will have greater job security and the creditors will receive a higher recovery. And the likelihood of a new management team interested in the growth and success of American Airlines will prevail. If the merger doesn't take place, it is probable that Horton will be the only one reaping the benefits of that.
If you would like to read APFA's final brief, click here. All of the court transcripts from the 1113 hearings can be found here. You will gain an invaluable amount of knowledge about the entire AA bankruptcy process if you take the time to review these documents. APFA encourages our members to also read the Wall Street Airline Analysts reports uploaded to our web site.
As you know, Judge Lane plans to make his decision regarding abrogating our contracts on June 22nd. Next week, TWU begins bargaining in mediated talks with Judge Peck in New York. Meanwhile, the pilots have extended talks with AA to next week. APFA will keep you posted of any changes to our bargaining status.
AA's Cascade Plan
Meanwhile back at Amon Carter Blvd., AA announced the fourth layer of its Cascade Plan - another name for management and staffing cuts from the top, down. This week we saw several changes affecting Flight Service including changes in Base Managers and Regional Directors - complete with severance pay for their troubles. For more information, visit Jetnet.
With a snappy sign off by our CEO that reads: "It's time to start winning again," the first column of Uniquely American was launched on Jetnet last Monday. It is intended to be a new way of communicating by Tom and gang. In his first entry, our Chairman writes, "[You'll hear about] our people, our best and most unique strength when it comes to taking on the competition." It is described as a place to share the exciting changes at American. You know, like how it wants to take over a billion a year from labor or convince the world of its Standalone Plan or ignore the obvious benefits of a merger with US Airways. Those are exciting changes.
APFA has received a few questions about possible hurdles regarding a merger with US Airways. The following should help clarify some of those issues.
Q. What is the status of the US Airways flight attendant pension fund and how will that impact our pensions?
A. In 2004, US Airways - prior to the merger with America West Airlines - was in bankruptcy. During the Chapter 11 process in 2004, the pension plan for US Airways flight attendants and other applicable union employee groups was terminated and the pension plan was moved to the jurisdiction of the Pension Benefit Guaranty Corporation (PBGC).
This doesn’t have any bearing on American Airlines’ pensions because the PBGC will continue to oversee the former US Airways’ flight attendant pensions as they do today. AA flight attendants' pensions are frozen and therefore are not handled by the PBGC. They are separate from US Airways with or without a merger. Bottom line, the merger has no impact on either group’s pensions.
Q. Someone told me that one of the hurdles the merger faces is that if we merge with US Airways, the wages for US Airways flight attendants who are based in CLT, DCA and PHL snap back to rates they earned before the US Airways bankruptcy in 2004. Is that true?
A. No. The contract for US Airways flight attendants – based in CLT, DCA and PHL – provides that if US Airways is acquired by another entity (as defined within their Collective Bargaining Agreement), the flight attendant wages will snap back to pre-US Airways bankruptcy rates. Since US Airways plans to take control of American Airlines, the wage snap-back provisions would not be triggered.
Implementation Schedule For Possible AA Term Sheet
APFA, APA and AA engaged in interviews this week to assist in the selection of a vendor for a Preferential Bidding program. The interview process continues and no vendor has been hired to date.
It is important to note that if AA receives approval to abrogate our contract, it is their plan to hold a special enrollment period and implement the proposed changes to our current medical coverage as soon as administratively possible. Once we know more, we will pass the information along to you. AA Human Resources has told us there would be no changes to any benefits other than medical coverage prior to 2013. It is APFA's understanding that deductibles and out-of-pocket maximums would be carried over to the new plan, however, if changes do occur, the deductible under the proposed health plans will be higher.
Other than these two items, APFA has received no indication from AA regarding its plans to implement the changes in its Term Sheet in the event that their request for contract abrogation is approved by the judge on June 22nd. As soon as we receive any further information, members will be notified. Meanwhile, we have encouraged AA to hold off with implementing anything in the event their request is granted.
That's it for this week. Encourage your coworkers to subscribe to this Hotline to receive the most up-to-date, accurate information.[/sup]
[sup]AmericanAirlines + US Airways
"Our Future Depends On It"
Leslie Mayo
APFA National Communications Coordinator
817.540.0108 ext. 8308
[email protected][/sup]
[sup]This is Leslie Mayo, National Communications Coordinator, with the APFA Hotline for the week ending Saturday, June 9, 2012.[/sup]
[sup]Bankruptcy Update
Labor stands strong in its commitment to our members for the best possible outcome of AMR's Chapter 11. We have no doubt that this will be achieved by continuing to pursue a possible merger with US Airways. This week, Morningstar came out with a particularly interesting analysis of the benefits of a merger and the reorganizational value of the two airlines. Here are its findings in a note as reported by Bloomberg News:
June 7 (Bloomberg) – American Airlines reorganization value of $22b through a merger w/ US Airways (LCC), $4b higher than standalone valuation, Morningstar analyst Basili Alukos said in a note this morning. Merger w/ LCC is “essential” for AMR to shrink $2b rev[enue] gap vs the industry $22b valuation would imply 73% recovery for creditors w/ impaired liabilities, incl. senior unsecured bondholders; would face 21% downside if AMR didn’t merge w/ LCC Morningstar sees LCC shareholders having 30% downside w/ no deal; sees 59% upside if merger takes place, achieves all projected synergies Morningstar sees rev. synergies $1.5b annually in AMR-LCC deal" According to Alukos, the Unsecured Creditors' are projected to recover .73 cents on the dollar with a merger and a 21% downside without one. He also agrees with US Airways' business plan that projects a synergies revenue of $1.5 billion a year with the combined airline."
The following is an excerpt from APFA's attorneys' final brief submitted to the court on Monday: "[Airline] industry analysts have responded negatively to American’s stand-alone business plan. Rodman and Renshaw analyst Daniel McKenzie concluded: “AMR’s plan to grow 20% over 5 years … is problematic … bad for AMR & the industry.” J.P. Morgan analyst Jamie Baker concluded: “We are underwhelmed with AMR’s standalone restructuring plan...” Wolfe Trahan's analyst Hunter Keay concluded: “We view AMR’s restructuring plan, founded on the idea of ‘growth and renewal,’ as unlikely to succeed.” These views reflect the consensus opinion, as explained by Analyst Baker: “Most airline’s management and clearly the majority of investors feel that American’s stand-alone plan represents a clear and present danger.”
The question is this: "Who wins in an AA/US Airways Merger? The answer is: everyone. The company will be far stronger, the employees will have greater job security and the creditors will receive a higher recovery. And the likelihood of a new management team interested in the growth and success of American Airlines will prevail. If the merger doesn't take place, it is probable that Horton will be the only one reaping the benefits of that.
If you would like to read APFA's final brief, click here. All of the court transcripts from the 1113 hearings can be found here. You will gain an invaluable amount of knowledge about the entire AA bankruptcy process if you take the time to review these documents. APFA encourages our members to also read the Wall Street Airline Analysts reports uploaded to our web site.
As you know, Judge Lane plans to make his decision regarding abrogating our contracts on June 22nd. Next week, TWU begins bargaining in mediated talks with Judge Peck in New York. Meanwhile, the pilots have extended talks with AA to next week. APFA will keep you posted of any changes to our bargaining status.
AA's Cascade Plan
Meanwhile back at Amon Carter Blvd., AA announced the fourth layer of its Cascade Plan - another name for management and staffing cuts from the top, down. This week we saw several changes affecting Flight Service including changes in Base Managers and Regional Directors - complete with severance pay for their troubles. For more information, visit Jetnet.
With a snappy sign off by our CEO that reads: "It's time to start winning again," the first column of Uniquely American was launched on Jetnet last Monday. It is intended to be a new way of communicating by Tom and gang. In his first entry, our Chairman writes, "[You'll hear about] our people, our best and most unique strength when it comes to taking on the competition." It is described as a place to share the exciting changes at American. You know, like how it wants to take over a billion a year from labor or convince the world of its Standalone Plan or ignore the obvious benefits of a merger with US Airways. Those are exciting changes.
APFA has received a few questions about possible hurdles regarding a merger with US Airways. The following should help clarify some of those issues.
Q. What is the status of the US Airways flight attendant pension fund and how will that impact our pensions?
A. In 2004, US Airways - prior to the merger with America West Airlines - was in bankruptcy. During the Chapter 11 process in 2004, the pension plan for US Airways flight attendants and other applicable union employee groups was terminated and the pension plan was moved to the jurisdiction of the Pension Benefit Guaranty Corporation (PBGC).
This doesn’t have any bearing on American Airlines’ pensions because the PBGC will continue to oversee the former US Airways’ flight attendant pensions as they do today. AA flight attendants' pensions are frozen and therefore are not handled by the PBGC. They are separate from US Airways with or without a merger. Bottom line, the merger has no impact on either group’s pensions.
Q. Someone told me that one of the hurdles the merger faces is that if we merge with US Airways, the wages for US Airways flight attendants who are based in CLT, DCA and PHL snap back to rates they earned before the US Airways bankruptcy in 2004. Is that true?
A. No. The contract for US Airways flight attendants – based in CLT, DCA and PHL – provides that if US Airways is acquired by another entity (as defined within their Collective Bargaining Agreement), the flight attendant wages will snap back to pre-US Airways bankruptcy rates. Since US Airways plans to take control of American Airlines, the wage snap-back provisions would not be triggered.
Implementation Schedule For Possible AA Term Sheet
APFA, APA and AA engaged in interviews this week to assist in the selection of a vendor for a Preferential Bidding program. The interview process continues and no vendor has been hired to date.
It is important to note that if AA receives approval to abrogate our contract, it is their plan to hold a special enrollment period and implement the proposed changes to our current medical coverage as soon as administratively possible. Once we know more, we will pass the information along to you. AA Human Resources has told us there would be no changes to any benefits other than medical coverage prior to 2013. It is APFA's understanding that deductibles and out-of-pocket maximums would be carried over to the new plan, however, if changes do occur, the deductible under the proposed health plans will be higher.
Other than these two items, APFA has received no indication from AA regarding its plans to implement the changes in its Term Sheet in the event that their request for contract abrogation is approved by the judge on June 22nd. As soon as we receive any further information, members will be notified. Meanwhile, we have encouraged AA to hold off with implementing anything in the event their request is granted.
That's it for this week. Encourage your coworkers to subscribe to this Hotline to receive the most up-to-date, accurate information.[/sup]
[sup]AmericanAirlines + US Airways
"Our Future Depends On It"
Leslie Mayo
APFA National Communications Coordinator
817.540.0108 ext. 8308
[email protected][/sup]
PITbull
Veteran
- Dec 29, 2002
- 7,784
- 456
Excerpt from APFA Communications above:
[sup]APFA has received a few questions about possible hurdles regarding a merger with US Airways. The following should help clarify some of those issues.
Q. What is the status of the US Airways flight attendant pension fund and how will that impact our pensions?
A. In 2004, US Airways - prior to the merger with America West Airlines - was in bankruptcy. During the Chapter 11 process in 2004, the pension plan for US Airways flight attendants and other applicable union employee groups was terminated and the pension plan was moved to the jurisdiction of the Pension Benefit Guaranty Corporation (PBGC).
This doesn’t have any bearing on American Airlines’ pensions because the PBGC will continue to oversee the former US Airways’ flight attendant pensions as they do today. AA flight attendants' pensions are frozen and therefore are not handled by the PBGC. They are separate from US Airways with or without a merger. Bottom line, the merger has no impact on either group’s pensions.[/sup]
[sup]Well I'll be damn.....the AAFA President has an inclination that USAirways unions are going to SUPPORT a frozen pension plan, she is wayyyyyyyyyyyy too NUTS!!![/sup]
[sup]There is a difference between a frozen pension and a terminated pension. A frozen pension just means there are no more accrual of service credits..BUT, THE EXISTING PENSION STILL HAS TO BE FUNDED!!!!!![/sup]
[sup]And by WHOM, pray tell???????????? In AAFA arrogance, do they really, really, really, really, think THEY are going to be the prevailing union???????????[/sup]
[sup]APFA has received a few questions about possible hurdles regarding a merger with US Airways. The following should help clarify some of those issues.
Q. What is the status of the US Airways flight attendant pension fund and how will that impact our pensions?
A. In 2004, US Airways - prior to the merger with America West Airlines - was in bankruptcy. During the Chapter 11 process in 2004, the pension plan for US Airways flight attendants and other applicable union employee groups was terminated and the pension plan was moved to the jurisdiction of the Pension Benefit Guaranty Corporation (PBGC).
This doesn’t have any bearing on American Airlines’ pensions because the PBGC will continue to oversee the former US Airways’ flight attendant pensions as they do today. AA flight attendants' pensions are frozen and therefore are not handled by the PBGC. They are separate from US Airways with or without a merger. Bottom line, the merger has no impact on either group’s pensions.[/sup]
[sup]Well I'll be damn.....the AAFA President has an inclination that USAirways unions are going to SUPPORT a frozen pension plan, she is wayyyyyyyyyyyy too NUTS!!![/sup]
[sup]There is a difference between a frozen pension and a terminated pension. A frozen pension just means there are no more accrual of service credits..BUT, THE EXISTING PENSION STILL HAS TO BE FUNDED!!!!!![/sup]
[sup]And by WHOM, pray tell???????????? In AAFA arrogance, do they really, really, really, really, think THEY are going to be the prevailing union???????????[/sup]
diamondcutter
Veteran
- Apr 11, 2007
- 640
- 618
Tell us how they would not be the prevailing union ? Our Afa int. finally has stepped in with more help you think it could be because they could be losing us. No need to paintbrush a whole group as arrogant.
PITbull
Veteran
- Dec 29, 2002
- 7,784
- 456
AFA International has more money than GOD. Don't forget AFA is with CWA: CWA/AFA, AFLCIO. That's the backing.
USAirways has a very, very strong AFA membership on the property. AAFA will be eating bologne sandwiches when all is said and done if they think they can bypass the unions at USAirways.
As I've said on here over and over again, the synergies don't work here because many of the issues that WILL arise will have to be litigated, and that will take years to resolve.
diamondcutter
Veteran
- Apr 11, 2007
- 640
- 618
Then what happened at delta
diamondcutter
Veteran
- Apr 11, 2007
- 640
- 618
So our Afa int. has the power and money to buy votes
signals
Veteran
Are you saying that because APFA is an in-house union it has no major backing from other unions? That would have meant that USAPA would have been screwed from the beginning. APFA outnumbers the AFA members at US, if I remember correctly.
The pension issue may be a smokescreen to deter from prevailing union and seniority issues. Parker has proven that with in-fighting he can still run a profitable airline, so the more the merrier!
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