What would happend if we merge again?

[prechilill]

I think Doug is speaking to AMR about a deal. The following information is more of the rumor type with comments and speculation, but here's my take.

1. There are message board reports on USaviation.com's website that APA President Dave Bates briefed the MIA Domicile late last month that he was recently at an industry conference, he personally talked to Scott Kirby, and Bates indicated US Airways was targeting AMR.

2. DFW station personnel are telling crews that Doug Parker, Scott Kirby, Robert Isom, and Derek Kerr have been regularly flying in and out of DFW.

3. A colleague of ours I spoke with recently spoke with a Virgin America crew. The Virgin Crew said Parker recently flew between LAX and DFW (to hide his whereabouts?) on Virgin.

4. In last month's PHX F/A Crew News (I believe the F/A session - may have been one of the other 3 sessions) when the AMR merger question was asked, Parker confirmed he's been going to DFW on business.

5. I believe the slot transaction may no longer be desirable if a deal proceeds with AMR. in fact, at last week's Annual US Airways Management Conference in PHX the "executive suite" was not in attendance, which is unusual. Where were all of the Officers?

6. Yesterday US Airways' Market Capitalization was $810.41 million. American's Market Capitalization was even less at $801.14 million, which makes an out of bankruptcy stock swap attractive, but still leaves the combined company with too high of costs.

This is all rumor type information, although I believe all of the five points above to be true. Here's where I'm going with this:

Fall Quarter - LOA 93 decision goes against USAPA and union neutered by Preliminary Injunction court order.

December 2011 - Slot Transaction decision

March 2012 - Bid to acquire AMR, pre-packaged bankruptcy to preserve cash, agreements with AMR unions to freeze pension/create a DC Plan, promise to APA/USAPA of DAL +1%, agreements with Boeing/Airbus and other creditors to keep aircraft, engine, and other deliveries intact.

December 2012 - DJ lawsuit decision, federal government does not oppose merger and US Airways-AMR file Hart-Scott-Rodino notice.

US Airways surviving entity, which bypasses East COC provision. Combined business entity called American Airlines. Pilot's offered DAL + 1 percent to support deal. Assuming the District Court rules the Nicolau Award is the list then this would be USAPA's list when we enter into the MacCaskill-Bond federal law seniority integration.

The NMB holds a representation election. APA becomes our union and Cleary & Co. is removed from office. Parker does not have to deal with USAPA ever again, USAPA folds, and Parker gets what he wants.

As a colleague of ours said, "(Parkers) got a court's decision that US Airways' pilots even so much as calling in fatigued may be in violation of the RLA. What more could the CEO of a LCC want? Checkmate."

Chip, nice analysis but one question: What happens to Apry and Parker? Who gets the keys of the combined company? (Hopefully it's not Parker)

 

[USA320Pilot]

I'm only speculating, but I do believe where there is a lot of smoke there is probably fire.

"In my opinion", Doug is a deep thinker, a strategic thinker by nature, and he would prefer to operate the combined business enterprise. "I believe" he does not care how the final pilot seniority list appears and he is looking for a way out of this mess. A deal with AMR is far from certain, but I sense and the media is speculating something may occur between the two companies.

I'm not sure how the pilot seniority lists would be integrated in a merger with AA; however, what we do know is that under Bond-McCaskill law (unlike ALPA Merger Policy) management has has a seat at the table, the DJ lawsuit District Court decision should be announced about the time the two companies obtain federal government merger blessing, the only list US Airways management currently holds is the Nicolau Award, and the Transition Agreement requires US Airways to implement the Nicolau Award. With all of those parameters in place how would a combined American, US Airways PHL/DCA/CLT-based pilots, and US Airways PHX-based pilots vote on a joint contract?

Another key point is American's pilot group is about twice as large as ours, thus, they have the ability to impose their will on us without separate ratification rights. Furthermore, with all that has occurred during the past 6 years and no separate East and West MEC's how would contract ratification work for US Airways' pilots with only the BPR representing the PHX, DCA, PHL, and CLT pilots?

Furthermore, how would a "one man, one vote" leadership style, if still in power, effect the future?

 

[Pi brat]

Nice post, both sides have professionals and there are some topics/ events which transcend politics. Sully and Skiles both did a great job with what they had and you cannot argue with the outcome.

Thanks pre, nice post. And Buffalo, you're wrong. Despite our petty back and forth on here both groups are professionals with their respective 5% club. I'd put my family on any US airplane, east or west.

 

[USA320Pilot]

Here's an interesting perspective from a US Airways pilot:

October 2011 - loa 93 decision that supports the company's understanding is released. Those that attempt to disrupt operations are terminated.

4th qtr, 2011 - AA continues to bleed cash. Judge Silver grants west pilots "Class Status". Company returns 3 west "identity theft" pilots to the line. NAC is parked. Those that attempt to disrupt operations are terminated.

1st qtr, 2012 - AA continues to bleed cash as FF use their accumulated miles. Judge Silver sets DJ date for 2nd qtr, 2012. NAC remains parked. Those that attempt to disrupt operations are terminated.

2nd qtr, 2012 - AA files Ch 11. Judge issues order in DJ declaring that company may be held liable for damages if a contract is negotiated that does not contain the unmodified Nic as the SLI. NAC remains parked, unwilling to accept Judge's order. Those that attempt to disrupt operations are terminated.

3rd qtr, 2012 - AA remains in BK as leases are renegotiated or scheduled for return, furloughs are announced, pension is frozen and concessionary contract is negotiated. USAPA files for appeal of DJ. NAC remains parked pending appeal. Those that attempt to disrupt operations are terminated.

4th qtr, 2012 - AA remains in BK as aircraft are returned to leasing companies, pilots are furloughed and concessionary contract negotiations continue. NAC remains parked pending appeal. Those that attempt to disrupt operations are terminated.

1st qtr, 2013 - AA remains in BK. Appeal is denied. NAC remains parked. Those that attempt to disrupt operations are terminated. A large percentage of east pilots make a "deathbed conversion" and approach ALPA regarding representation...ALPA says "No thank you, you crapped in your own bed and now you can lie in it as you negotiate your contract & seniority with the AA pilots...goodluck". Those that attempt to disrupt operations are terminated.

2nd qtr, 2013 thru 2nd qtr, 2014 - Merger is announced. Underfunded USAPA merger committee relying on a late assessment and required to use the Nic is ineffective vs. well-funded AA merger committee. Recent AA furloughees from BK are placed ahead of many east working pilots on SLI using a LOS methodology mirroring USAPA's C&BL's, with previous AA furloughees placed last. DAL -5% + signing bonus looks huge compared to loa 93 for the east or BK for AA pilots and is accepted...by this time neither pilot support or DAL +1% is necessary for management to complete transaction.

 

[foreright]

The AA pilots want nothing to do with western scabs. Why would they Niclau and put stupid young western in senior slots you stupid western idiot! God damn you young snappers are ignorant.! 767 jets bald ass lies are as clear as his sorry head. What an embarrassment that shining mess is. The truck story tells an ignorant
tale. You are really a bald liar.

i love scotch wiskey too! btw agreed. although i wouldnt call the west scabs. not yet....

 

[luvn737s]

Parker could force the entire group to swallow LOA93. He's seen how unnecessary the velvet glove was. Since the hammer has been far more successful in dealing with labor, I would expect more, not less of it.

 

[Pi brat]

Here's an interesting perspective from a US Airways pilot:

October 2011 - loa 93 decision that supports the company's understanding is released. Those that attempt to disrupt operations are terminated.

4th qtr, 2011 - AA continues to bleed cash. Judge Silver grants west pilots "Class Status". Company returns 3 west "identity theft" pilots to the line. NAC is parked. Those that attempt to disrupt operations are terminated.

1st qtr, 2012 - AA continues to bleed cash as FF use their accumulated miles. Judge Silver sets DJ date for 2nd qtr, 2012. NAC remains parked. Those that attempt to disrupt operations are terminated.

2nd qtr, 2012 - AA files Ch 11. Judge issues order in DJ declaring that company may be held liable for damages if a contract is negotiated that does not contain the unmodified Nic as the SLI. NAC remains parked, unwilling to accept Judge's order. Those that attempt to disrupt operations are terminated.

3rd qtr, 2012 - AA remains in BK as leases are renegotiated or scheduled for return, furloughs are announced, pension is frozen and concessionary contract is negotiated. USAPA files for appeal of DJ. NAC remains parked pending appeal. Those that attempt to disrupt operations are terminated.

4th qtr, 2012 - AA remains in BK as aircraft are returned to leasing companies, pilots are furloughed and concessionary contract negotiations continue. NAC remains parked pending appeal. Those that attempt to disrupt operations are terminated.

1st qtr, 2013 - AA remains in BK. Appeal is denied. NAC remains parked. Those that attempt to disrupt operations are terminated. A large percentage of east pilots make a "deathbed conversion" and approach ALPA regarding representation...ALPA says "No thank you, you crapped in your own bed and now you can lie in it as you negotiate your contract & seniority with the AA pilots...goodluck". Those that attempt to disrupt operations are terminated.

2nd qtr, 2013 thru 2nd qtr, 2014 - Merger is announced. Underfunded USAPA merger committee relying on a late assessment and required to use the Nic is ineffective vs. well-funded AA merger committee. Recent AA furloughees from BK are placed ahead of many east working pilots on SLI using a LOS methodology mirroring USAPA's C&BL's, with previous AA furloughees placed last. DAL -5% + signing bonus looks huge compared to loa 93 for the east or BK for AA pilots and is accepted...by this time neither pilot support or DAL +1% is necessary for management to complete transaction.

You left something out. What would happen to "Those that attempt to disrupt operations".

 

[Res Judicata]

East pilots are Veterans, West are Rookies! Would a west pilot be able to pull what Sully done?

You mean crash a perfectly flyable aircraft into a river?

 

[Reed Richards]

I'm not sure how the pilot seniority lists would be integrated in a merger with AA; however, what we do know is that under Bond-McCaskill law (unlike ALPA Merger Policy) management has has a seat at the table, the DJ lawsuit District Court decision should be announced about the time the two companies obtain federal government merger blessing, the only list US Airways management currently holds is the Nicolau Award, and the Transition Agreement requires US Airways to implement the Nicolau Award. With all of those parameters in place how would a combined American, US Airways PHL/DCA/CLT-based pilots, and US Airways PHX-based pilots vote on a joint contract?

Any DJ ruling, either way solves nothing. Your logic concerning the T/A and Nic being the list is tired, simply wrong, and years old. Remember, even Parker acknowledges another couple of years in the mix on appeal to the Ninth if the DJ rules his way (which I doubt they will..but anything is possible in PHX!) I am also not connecting the dots on your failed logic that the Nic would be “imposed” via any ruling. East and West would still vote on that list residing in a contract. Nic is not simply imposed prior to negotiations with another airline.

What is more likely, and maybe a speedier resolution of our quagmire (not the pilot on Family Guy) is to enter into a seniority process with East, West, and the new guys in a three way, a do over. Risk for all, and probably a trip Bond-McCaskill. Not a solution that would make either East or West happy, we could spend all day talking about that..but at least one that might put some finality on the table. Also one that would require East and West to want a union hitting on all cylinders. As Al said earlier, a method of funding for the West Seniority effort would have to be worked out, and the chances of that happening with current leadership are nil.

RR

 

[Res Judicata]

Any DJ ruling, either way solves nothing. Your logic concerning the T/A and Nic being the list is tired, simply wrong, and years old. Remember, even Parker acknowledges another couple of years in the mix on appeal to the Ninth if the DJ rules his way (which I doubt they will..but anything is possible in PHX!) I am also not connecting the dots on your failed logic that the Nic would be “imposed” via any ruling. East and West would still vote on that list residing in a contract. Nic is not simply imposed prior to negotiations with another airline.

What is more likely, and maybe a speedier resolution of our quagmire (not the pilot on Family Guy) is to enter into a seniority process with East, West, and the new guys in a three way, a do over. Risk for all, and probably a trip Bond-McCaskill. Not a solution that would make either East or West happy, we could spend all day talking about that..but at least one that might put some finality on the table. Also one that would require East and West to want a union hitting on all cylinders. As Al said earlier, a method of funding for the West Seniority effort would have to be worked out, and the chances of that happening with current leadership are nil.

RR

Great idea!! That way the East can just keep getting do over after do over until they "like' Final and Binding. Sorry. It's over and paid for.

 

[Move2CLT]

East pilots are Veterans, West are Rookies! Would a west pilot be able to pull what Sully done?

Troll much?

 

[Move2CLT]

Any DJ ruling, either way solves nothing. Your logic concerning the T/A and Nic being the list is tired, simply wrong, and years old. Remember, even Parker acknowledges another couple of years in the mix on appeal to the Ninth if the DJ rules his way (which I doubt they will..but anything is possible in PHX!) I am also not connecting the dots on your failed logic that the Nic would be “imposed” via any ruling. East and West would still vote on that list residing in a contract. Nic is not simply imposed prior to negotiations with another airline.

What is more likely, and maybe a speedier resolution of our quagmire (not the pilot on Family Guy) is to enter into a seniority process with East, West, and the new guys in a three way, a do over. Risk for all, and probably a trip Bond-McCaskill. Not a solution that would make either East or West happy, we could spend all day talking about that..but at least one that might put some finality on the table. Also one that would require East and West to want a union hitting on all cylinders. As Al said earlier, a method of funding for the West Seniority effort would have to be worked out, and the chances of that happening with current leadership are nil.

RR

The chances of that scenario happening, regardless of leadership, is nil.

There are so many things wrong with that post that it's stupid to even bring up. It just shows your complete lack of understanding of the process.

Why in hell would the west pilot, represented by USAPA, want a do- over?

 

[Pi brat]

You mean crash a perfectly flyable aircraft into a river?

You are amazing. Have you actually read the NTSB report, or do you just know more about it than they do, like you do about everything else?

It's 213 pages long, but here are a couple of items from the Conclusions:

6.
Both engines were operating normally until they each ingested at least two large birds (weighing about 8 pounds each), one of which was ingested into each engine core, causing mechanical damage that prevented the engines from being able to provide sufficient thrust to sustain flight.

7.
If the accident engines’ electronic control system had been capable of informing the flight crewmembers about the continuing operational status of the engines, they would have been aware that thrust could not be restored and would not have spent valuable time trying to relight the engines, which were too damaged for any pilot action to make operational.


You are an embarrassment.

 

[LUVJAMESC4EVER]

But if it continues to burn through its cash at its current rate, it won't have much left to keep it going if it eventually does head into bankruptcy. Without sufficient cash, American could go the way of the once iconic Pan Am or Eastern Airlines and simply cease operating. Such a scenario would put thousands of jobs at risk and hurt competition. That would not only be bad for the employees and pensioners of American, but it would also deliver a strong blow to the millions of business and leisure travelers that depend on the airline to move them around the world every day.


http://finance.fortune.cnn.com/2011/10/04/american-airlines-bankruptcy/?source=yahoo_quote

 

[LUVJAMESC4EVER]

It could be?

As with that merger, consolidations provide companies greater synergies and improved pricing power that many analysts say are essential for the sector’s turnaround. The most likely candidate for a possible merger with American would be U.S. Airways, Herbst said. Mann, too, suggested that U.S. Airways may consider a bid.

Read more: http://www.foxbusiness.com/travel/2011/10/04/american-airlines-bankruptcy-may-pump-life-into-us-airlines/#ixzz1Zvf1w25f