US/UA Official Merger Thread II

[PhillyFlyGuy]

Doesn't look like LH will invest into this merger, however they do support the combo

ATW Link

 

[Strider]

Just curious....(Hypothetically Speaking) Lets just say the UA/UAL merger goes through. When all said and done they want to retire some aircraft, no replacements right away. With this in mind there most likely will be some furloughs and most likely...the way things are going...not a solid senority list is in place. How will the furloughs be accomplished?

If this is on the wrong thread...my apologies.

 

[galley princess]

If you go to "Today in the Sky" on USA today's website there's an article about UA, Parker and a CO alliance. It strikes me that UA is playing coy or US is evasive after looking at the books.

Given that Tilton is dangling the CEO spot in front of Parker but not promising it, I think UA is playing coy. I also think that there's no way Parker will merge us if he isn't assured the CEO spot, so I think this thing is dead for now. They only have so much time to get this through before Bush leaves office, and if they wanted a merger it would be announced ASAP. They're having glitches.

On an unrelated note, anyone catch the blurb on NPR about summer travel? It might have been PHL news only, but basically citing "high airfares, poor customer service" they expect people to drive to vacations and wait for deals. Our domestic flights may not be so full this summer. Always nice to know that when they talk about "poor customer service" in PHL, we all know what company they're talking about. US may be left to its lonesome. Parker should start thinking about settling this mess and actually running US. With oil prices and economic retractions by consumers, the margin for error is shrinking.

 

[US1YFARE]

Parker not gauranted to be CEO

I love this line: The report added that it was unclear if Parker is willing to be Tilton's apprentice. APPRENTICE LOL

What does that make Scooter? LOL

 

[UALDC767]

Talk is cheap, just like Doug parker and Scott Kirby. With that in mind I offer you some thoughts on the alledged merger from a colleague. Interesting points. see what you think:

Merger with United....

I'm against it for several reasons. I see no benefit for the consumer.

Problems with United:

Six separate classes of service to deal with:

Economy
Ted
EconomyPlus
Domestic First
International First
International Business Class
Premium Service (p.s.) (p.s. First/p.s. Business/p.s. EconomyPlus)

This doesn't sound like a big issue, but believe me, it is. To add to it, you've got a mixed Airbus/Boeing fleet with no clear commitment to either! You've got multiple configurations of the same aircraft rolling around which severely limits your flexibility. They have two versions each of the 737-300, 737-500, A320, 747-400, and 757-200. You have three different versions of the 767-300 and FOUR different versions of the 777-200. If a plane is out of service or what not, you've got to locate that same type of aircraft immediately or switch to another type which depending on the plane, you could end up bumping people or having wasted space (lost revenue either way).

For all of these fare classes, you've got scores of people working out the pricing on these classes of service. Since no one else has as screwed up a product offering as United, there's not a lot to compare it to. So they price too high or too low. It's confusing and stupid. Not to mention all the costs of reconfiguring these boats, market research, etc. Not really a great way to spend your money for an airline with no money.

Compare that to Continental:


Economy
First
BusinessFirst
That's it. All the planes have the same configuration except for the 767-400 (Hawaii and Europe) and the 737-800's which has the "with a mid-cabin-lav" and "without a mid-cabin-lav" versions for short and long-haul flights. They're also re-doing the 777's with new lie-flats so right now you could encounter two different versions of that one. The all-Boeing fleet is a great bonus for simplicity and pilot group simplicity. The point is: SIMPLICITY is not present at United in any way. United aims to make things more complex.

Problems with US:

US on the other hand: Economy, First, Envoy. This is simple and easy. It's cheap. As much as we complained about it when they were doing it, the planes are all configured the same, more or less. Yeah, I know they've got the East/West 757's and 737's but this is nowhere near as screwed up as United. They've got enough of that Southwest mentality left in them to know that SIMPLE sells and COMPLEX crashes and burns. Implementing it has been a problem, but let me give them credit where it's due.

Piney,

Just a few comments...

Ted really isn't a seperate class of service, just Econ+ and Econ which already exist but you know that. Now if you want to talk about marketing and brand confusion, I agree it makes a mess.

There is only one version of the 747-400. And the 757 PS fly a limited/closed route system so not really a factor when it comes to swapping airplanes around.

There are only 2 versions of the 767. The international configured one and the domestic high density configuration.

And only 2 real versions of the 777. Again the internantional (albeit some slight seating changes due to the Pacific version which require a bunk for the pilots 10/45/198 versus the older A models of 12/49/197) and the domestic (36/312)

That being said ALL international planes are going thru the international premium product upgrade and will have one cabin version across their respective fleets (scheduled to be done by end 2009), but until then there will be some mixed configurations as they retrofitted.

The 737-500's will be gone by the end of the year.

So by the end of 2009, as of right now, UAL will look like this.

737-300 (still some shuttle types too)
A319
A320 (regular and Ted)
757 (regular and PS)
767-300 (domestic and international)
777-200 (domestic and international)
747-400


From a pilot group simplicity point at UAL, a 737 pilot can fly all versions of the 737, same for the Airbus pilots, the 757 pilot also flies the 767 (some airlines don't do that and also no seperate international versus domestic ops like some other airlines do. Two weeks ago I flew to AMS on the 767, and last week did a purely domestic 757 trip. Some trips we even have one leg on a 767 followed by a 757 leg) and the 777 and 400. So there are only 5 basic fleets for the pilots (and mechanics)

CAL has 4 versions of the 737-800 depending on the seat map (14/141-no mid lav, 18/132-no mid lav, 16/141-mid lav, 20/132-mid lav) in addition to the 737-300/500/700/900, two versions of the 757, 200/300 and the 767, 200/400 and two seating configurations on the 777 (48/235 and 50/235 if you are going to ding UAL for slight seat/cabin configs then you have to ding CAL as well) Not quite as simple as you make it seem.

As much as you say complexity might result in loss of revenue due to equipment subs, the opposite could be said for having a cabin configuration tailored to the market. It captures the revenue appropiate to that market. Thats why some flights are on a A319 versus A320, even within the same city pairs. And all airlines do that.

Are you telling us that CAL when a 757-300 goes MX and they sub a 757-200 or 737-900 (or even smaller/larger a/c) that they aren't going to have problems? If the flight was full? Equipment subs create problems for all airlines.


Should everyone be like Southwest (and even then they still have 3 types of 737's), perhaps, but the Legacies aren't all that differrent really when compared to one another. Doesn't Southwest lose revenue by not offering a First Class? Sure they do, but they decided that the capturing of that revenue is not worth the cost of doing so. Same could be said of their lack of assigning seats.

I agree it is complex, and hopefully upper/middle management/those whose job it is to figure these things out, are doing the a good job of matching seats/pricing to the market. Time will tell if its the right decision.

DC

PS the employees who would benefit most from only one type of seating configuration? The CSR's who have to deal with whiny passengers when their seat is no longer there due to an equipment sub. :bleh:

 

[nycbusdriver]

I love this line: The report added that it was unclear if Parker is willing to be Tilton's apprentice. APPRENTICE LOL

What does that make Scooter? LOL

I don't think Parker will accept Second Banana at UAL no matter what Tilton tells him, nor how soon Tilton promises to retire. When airline CEO's get to that level, their egos get so large that they wouldn't take a step backward and be answerable to someone else. I don't recall that ever happening, except for Bruce Lakefield at US who was dragged into the CEO role kicking and screaming by David Bronner. Lakefield could not wait to get out of being an airline CEO. He made it clear that he hated it from day one, but was doing it as a personal favor to Bronner.

 

[freedom]

Tilton’s done a great job over the years of managing UA , but I think this new situation calls for DP and crew … althou ,I think we should keep MR T around in a advisory roll , it’s always nice to have someone to go to for advice ..

 

[nycbusdriver]

Tilton’s done a great job over the years of managing UA , but I think this new situation calls for DP and crew … althou ,I think we should keep MR T around in a advisory roll , it’s always nice to have someone to go to for advice ..

I suppose if Tilton accepted the role of Chairman and let Doogie be CEO, that might work to assuage all involved egos.

But the merger would still be a train wreck, and I pray that it does not happen.

 

[USA320Pilot]

Tilton to groom US Airways chief if deal goes ahead

See Story

Regards,

USA320Pilot

 

[freedom]

I dunno NYC , people said our merger would be a train wreak , and for the most part I’d say it’s working fantastically!

Now of course the pilots and flight attendants are going to disagree with me because their having labor problems , but those problems aside ,for the passenger looking to go from point A to point B service has never been better! (service X price ) .

 

[gaucho99]

Thank GOD!
No United merger; best damn news all week.

Later,
Eye

That's a little premature wishful thinking, especially when you consider the remarks below:

The official said it would not be unusual for Continental to be considering alternatives, but that the British Airways-Continental-American talks are progressing and don't appear in jeopardy. British Airways publicly disclosed the talks April 30.

Bob Mann, an independent airline consultant based in Port Washington, N.Y., said he doesn't think an alliance between United and Continental is likely because it wouldn't go far enough to solve the carriers' cost and capacity issues.

"The United guys are very much heading in the direction of something that will really allow them to downsize the airline," he said. "We're talking about large capacity cuts. ... The alliance doesn't get to the point where you can really do the capacity-cutting."

 

[freedom]

Tilton to groom US Airways chief if deal goes ahead

I would rather we not merge if Parker isn’t in charge of the operation . Look at united’s balance sheet , their doing horrible and so we want to KEEP their current management ? Why ,so they can continue their current downward spiral ? It’s time to SHAKE THINGS UP , and for that united needs the new blood of parker and gang ..

A merger would be great , I can see a lot of benefits … but if united’s investors want to lose all of their hundreds of millions of dollars I won’t lose any sleep .. You don’t want the management team that will not only MAKE you more money but keep your current investment from going belly up ? FINE , our company US AIRWAYS has more than enough money to weather the storm , and a few years from now when your forced to close your doors we’ll just buy your routes and planes from the auction house ..


If you’re an investor for UNITED then I strongly suggest you tell your BOD that you want PARKER to lead it and not MR T …..

 

[whlinder]

I'm personally skeptical about the benefits of a UA/US merger at this point in time. 8 years ago or whatever, US was still chasing business travellers and doing a decent job of it in important east coast markets. UA at the time was making pretty good money (when the merger was announced anyway, they were starting to slip IIRC). Combining the two was supposed to be a revenue power house with access to all the markets that matter.

Now the name of the merger game is accessing international revenues and cutting costs through size reductions to get raise domestic fares. To effectively shrink a CH11 hammer helps tremendously. For bad management teams, this is virtually the only way to survive with fuel prices this high. Effective managements teams (WN, CO, AS, maybe AA) can steer their companies through fairly well, but poor ones have to resort to other options. Which means until competent management can be found, carriers like UA and US will be trying to shrink to profitability. UA filing Ch11 and Dougie and the gang swooping in to replicate the US/HP "merger" for US/UA could certainly work and make the wall street folk happy. Cancel the UA express contracts (except for the CR7s and 170s), drop some 737s and shed other excess facilities cheaply (and sadly, employees too). I don't know how else a combination here makes much sense; can the necessary shrinkage cuts be made in a UA/US merger to make the combined clusterF profitable?

 

[700UW]

Tilton to groom US Airways chief if deal goes ahead

See Story

Regards,

USA320Pilot

All ready posted

 

[RowUnderDCA]

This is not about benefits or enhancements. It's about survival. Most of this depends on how desparate UA really is... how much they need to do and how quickly they need to do it.

I don't know what the answer is, but I don't think it's the first, best choice for either carrier.

Parker has both a clearer idea about how bad things are going to get and more ambition to be the guy facing it, IMO.

But, I think that nobody really cares about US staying power, but all eyes are on UA.

After any combination, UA/US is still going to be the weak sister in the industry.

I wouldn't be surprised if both carriers are looking at each other and figuring out whether it would be better to not merge and try to out last the other. Like I said, a vanishing US Airways wouldn't be THAT big of a deal for the industry. A vanishing, or rapidly contracting UA would be a big deal.

Worying about pilot integration and res systems migration... ... well I wonder if that's really the priority of these decision makers right now.

I wish I had read whlinder's post, because I could have just agreed!