US Airways Said to Develop AMR Merger Plan to Fix Revenue Gap

[Maark767]

How was it a headache when you stapled us to the bottom. Headache for us maybe. All I hope is that Delta and or US air Merges with us and they use DATE OF HIRE then you can post what ever you like, that would be a headache for ya union brotha.

Good point!!! We shall see what happens..... its out of our hands!!

 

[signals]

If we want to create merger-wolf conspiracies, how about the fact that Doug worked at AA from 1986-1991? How can this merger possibly not go through?

 

[Maark767]

If we want to create merger-wolf conspiracies, how about the fact that Doug worked at AA from 1986-1991? How can this merger possibly not go through?

Many of those guys worked at AA and other airlines.... The good old boys club!!
I just have to ask myself, what is AA going to do with PHX and PHL??? It just doesn't fit but what do I know.....

 

[wings396]

PHX may not fit, but I think that PHL does. Many here seem to overlook the value of PHL. While JFK isn't that far away, they draw traffic from different areas that can support each of them.

 

[bigbusboy]

PHX would be the "consolidation" part of any merger and divided between LAX and DFW. PHL would be a very good fit with AA's JFK. UA/CO seem to be making EWR/IAD work very well for them and DL soon will do the same with LGA/JFK. Double hub ops along the east coast seem to be the direction the competition is taking, not to mention all of the market share east of the Mississippi AA lacks now that would feed nicely into the focus cities several "know-it-all analysts" seem to think are pared back too far to be viable....just sayin'

 

[TWskyliner]

How was it a headache when you stapled us to the bottom. Headache for us maybe. All I hope is that Delta and or US air Merges with us and they use DATE OF HIRE then you can post what ever you like, that would be a headache for ya union brotha.

Yeah....I think I must have missed the merging of work groups.

 

[chris perry]

It won't matter much who we merge with or not.This company continues to waste money at a alarming rate.Example( a whole fleet of 200k each computerized lav trucks). The last time I checked #### flows down hill from the chute...simple concept it has been working for 80 years. Now all the sudden
it has to have a computer and fancy backwash system,when it breaks it costs more than a conventional truck to fix it. Now that's thinking cost savings..And everyone here is worried about Mergers...Who's making these decisions? It's sure not the rank and file.

 

[usa1]

You're delusional.

My apologies .... I mixed you and AAviator up.

 

[Airlinelifer]

It won't matter much who we merge with or not.This company continues to waste money at a alarming rate.Example( a whole fleet of 200k each computerized lav trucks). The last time I checked #### flows down hill from the chute...simple concept it has been working for 80 years. Now all the sudden
it has to have a computer and fancy backwash system,when it breaks it costs more than a conventional truck to fix it. Now that's thinking cost savings..And everyone here is worried about Mergers...Who's making these decisions? It's sure not the rank and file.

Whoever signed off on that purchase probably made some nice $$$$$$$.

 

[Maark767]

PHX would be the "consolidation" part of any merger and divided between LAX and DFW. PHL would be a very good fit with AA's JFK. UA/CO seem to be making EWR/IAD work very well for them and DL soon will do the same with LGA/JFK. Double hub ops along the east coast seem to be the direction the competition is taking, not to mention all of the market share east of the Mississippi AA lacks now that would feed nicely into the focus cities several "know-it-all analysts" seem to think are pared back too far to be viable....just sayin'

Good point about double hubs but is it worth AA to merge with US just to get PHL or CLT? With the other mergers it was beneficial for BOTH airlines. CO gained UALs asian presence and UAL gained EWR. DAL did the same with NWA gaining asia and NWA gained a huge presence to europe. A merger takes a lot of capitol and Im not sold on the fact that AA would really have a lot to gain. It seems that US would be the one gaining. AA can grow like crazy domestically . With 500 fuel efficient jets on order and 5 major hubs across the USA, the option to grow is prime and ready to go. AA would bring on new hires with lower wages for the growth instead of a merger partner with senior employees. Time will tell though.

 

[JFK Fleet Service]

I think it is more about mass at this point.Turnkey access to FF base,corporate contracts,ect.

AA is a small fish these days thanks to complacent management.

 

[bigbusboy]

Good point about double hubs but is it worth AA to merge with US just to get PHL or CLT? With the other mergers it was beneficial for BOTH airlines. CO gained UALs asian presence and UAL gained EWR. DAL did the same with NWA gaining asia and NWA gained a huge presence to europe. A merger takes a lot of capitol and Im not sold on the fact that AA would really have a lot to gain. It seems that US would be the one gaining. AA can grow like crazy domestically . With 500 fuel efficient jets on order and 5 major hubs across the USA, the option to grow is prime and ready to go. AA would bring on new hires with lower wages for the growth instead of a merger partner with senior employees. Time will tell though.

You're right about AA being in a good position to grow on its own, but growth adds capacity and too much capacity is what brought this industry to its knees. AA adding flights to feed its hubs puts more seats into the market and this industry has very little room for growth. Right now, most airlines average 80%+ capacities and most people say industry capacity is about where it should be....a valid arguement for not needing any more consolidation. My point is US brings revenue, feeder traffic (east of the Mississippi), and market share all without adding capacity to the industry. Granted, US's network would need some reworking to fit into AA's MIA/JFK hubs. Merging with B6 fits nicely with JFK, but adds little to the revenue picture and very little for market share. Mergers today are about growing revenues and market share without adding capacity to the industry. US's east coast presence along with AA's JFK/MIA ops. puts AA on par with DL. in terms of revenue, market share, and FF base.

 

[damajagua]

You're right about AA being in a good position to grow on its own, but growth adds capacity and too much capacity is what brought this industry to its knees. AA adding flights to feed its hubs puts more seats into the market and this industry has very little room for growth. Right now, most airlines average 80%+ capacities and most people say industry capacity is about where it should be....a valid arguement for not needing any more consolidation. My point is US brings revenue, feeder traffic (east of the Mississippi), and market share all without adding capacity to the industry. Granted, US's network would need some reworking to fit into AA's MIA/JFK hubs. Merging with B6 fits nicely with JFK, but adds little to the revenue picture and very little for market share. Mergers today are about growing revenues and market share without adding capacity to the industry. US's east coast presence along with AA's JFK/MIA ops. puts AA on par with DL. in terms of revenue, market share, and FF base.

I get your point about revenue. But would the merge company be profitable?

 

[frontline]

I don't see it either. Let's look at the hubs:

AA

JFK
MIA
ORD
DFW
LAX

US

PHL
CLT
PHX

So a merged AA/US would have JFK, PHL, CLT and MIA on the east coast. Two of those would have to go on the chopping block, and I can guarantee you it wouldn't be JFK or MIA.

DFW and LAX for AA basically service the same markets that PHX does for US.

So there's your answer: just shut down US, it's not necessary.

 

[FWAAA]

Delta certainly needed the Pacific operations that Northwest possessed, and DL got three NW hubs in the deal, DTW, MSP and MEM. DL has added a lot at DTW, a hub that doesn't have a ton of O&D but is a perfect connecting hub (not unlike PIT). It has great geography and very nice airport infrastructure. By all accounts, DTW has been a great addition. MSP, not quite so much, as it has not received the same level of increased service - and may have seen some cuts. MEM? It got a taste of what happened at CVG (and what happened at STL). Overall, however, DL got some great real estate and plenty of customers. NW had some LGA slots that, when added to the Doug Parker gift of lots of LGA slots, makes DL the dominant carrier at LGA.

United gained a huge hub at IAH when it combined with CO, not unlike AA's DFW hub. IAH ain't going anywhere. EWR? I laughed when Burr and PeoplExpress talked about the new EWR terminal over 25 years ago, but it's worked out for CO, and finally, UA has some strength in the NYC market again, after watching from the sidelines and trying to connect the UA faithful to IAD for international flights. CLE? Long ago it got the CVG/STL/MEM treatment.

US? If PHX could support significant numbers of international flights to Europe or Asia, someone would already be flying them. US isn't, and a combined US-AA ain't gonna fly them either. Yes, there's a flight to London and maybe a couple others, but LAX and SFO will be the Pacific gateways, not PHX. CLT? Takes a lot of feed to support its flights to Europe. Those people are connecting anyway, so why not connect at MIA or JFK? PHL? Same thing. If you're connecting at PHL to Europe, why not connect at JFK or MIA? That just leaves the CLT and PHL O&D traffic to Europe, and they might not want to connect at JFK or MIA - if their nonstops cease to exist, they might prefer to connect at EWR or ATL or IAD.

Others have said it better than me, but the plan seems to be "merge and then use US to feed the AA hubs." if US does that, how will it keep feeding the US hubs?