Will U's Future Partner Please Step Forward?

[bankernclt]

Just read that Branson may be interested in some of U’s assets, and Virgin US and U may become partners. Read the last couple of paragraphs:

http://biz.yahoo.com/rc/040323/airlines_vi...atlantic_1.html

Could this be the best partner?

 

[Light Years]

Wish list

*Heathrow rules are relaxed, US gets some LHR lovin

*VS buys Bmi, becoming an even better competitor to BA, stays a Star member

*Branson ditches his USA LCC idea, buys into US Airways instead (with others as he cant run it), turns them around into the premier US airline, and together with VS becomes a transatlantic powerhouse with the US East Coast empire and VS/BMI's UK and European routes.

Realistic wish list

*US Airways doesnt go out of business

 

[Just Plane Crazy]

I don't think that U will leave STAR. Branson is interested because he want's to get up and running and buying is faster than building.

 

[usfliboi]

this doesnt mean anything . Who would want out slots if they had money?

 

[More Facts and Less Emotion]

I'm glad to see there are some people who are still optimistic that US Airways can survive through some miracle like this without major cost cuts. But let's think rationally.

Branson is interested in launching a LOW COST CARRIER in the United States. US Airways is nowhere near being low cost at current rates, seniority and work rules.

There was an article today that compared Jet Blue to US Airways and highlighted how much better their customer service was. And they are doing it with lower paid labor. So higher wages clearly do not equal better service.

So if you are Branson, you are going to launch a brand new airline with Jet Blue rates, not pick up a headache group of labor contracts where unions are saying, "we already gave", "the concession stand is closed", etc.

Now there might be a potential financial arrangement in the future, but it will only be possible if the costs become competitive first.

 

[ClueByFour]

There was an article today that compared Jet Blue to US Airways and highlighted how much better their customer service was. And they are doing it with lower paid labor. So higher wages clearly do not equal better service.

I've bought from both, talk to both sets of rez agents, and I think that the service is comperable (with the US1 desk solidly trouncing anything jetblue has). That said, it's apples to oranges to compare the two reservation outfits.

I'd be willing to bet that if you head to INT or over to RIDC you could find %20 of the workforce who would take a %25 paycut if you told them they could live anywhere and work from home (which is how Jetblue does it).

More facts and less spin, please.

 

[Fly]

I do not believe it's better customer service...not by a long shot. I think you have a bunch of 20 year olds who want to see the world and bask in the "glamour" of airline life. Now mix that with the "dumbing" of America (ie - TV's) and you've got JetBlue. Let's see how "star eyed" they are after 15 years....and let's see if they still maintain that "darling" status once the employees have aged a little bit more. Heck, I think babies are cute too....not capable of much, but definitely cute!

 

[javaboy]

From the WSJ.

http://online.wsj.com/article/0,,BT_CO_200...tml?mod=COMPANY

US Airways May Become Major Shareholder In Virgin USA


DOW JONES NEWSWIRES
March 23, 2004 7:01 p.m.

LONDON -- US Airways (UAIR) could become a major shareholder in the new low cost start-up Virgin USA, said Virgin Group (VGN.YY) Chairman Richard Branson Tuesday.

"US Airways does have some assets which we'd be quite interested in. If sonmething happens there, we might well find they'd become partners instead of us having equity partners. There might also be some equity partners as well but they (US Airways) would become a major shareholder," Branson said. He made his remarks to reporters at his London home Tuesday.




Virgin Group plans to take a 49% stake in the new U.S. carrier with the balance of the shares coming from equity partners, such as venture capitalists and staff, he said.

"We are not in any discussions with Virgin USA or any other Virgin representatives," a US Airways spokesman said late Tuesday.

Branson said the new company was in talks with an unnamed U.S. carrier about buying some of that carrier's airport slots. He told Dow Jones Newswires later Tuesday that Virgin USA had been in talks with more than one carrier about slots.

The new airline is expected to start operations early next year if not sooner, Branson said. A operations base has not yet been decided but the short list includes Los Angeles, San Francisco, Boston and Washington, D.C., he said.

In terms of aircraft, Virgin USA would start talks with both Boeing (BA) and Airbus (ABI.YY) within the next week over an order of about 30 planes. He said the planes were likely to be 737s or A320s. Separately, Bombardier (BBD.B.T) and Brazil's Embraer (EMBR4.BR) will compete for a regional jet order of about 20 planes, "but that's not this month", Branson said

 

[BoeingBoy]

I believe this is the article in question:

NYT Article

Jim

 

[USA320Pilot]

US Airways May Become Major Shareholder In Virgin USA

US Airways spokesman: “We are not in any discussions with Virgin USA or any other Virgin representativesâ€￾

LONDON (Dow Jones) - US Airways could become a major shareholder in the new low cost start-up Virgin USA, said Virgin Group Chairman Richard Branson Tuesday.

See Story

Regards,

USA320Pilot

 

[ClueByFour]

U is in a quandry here. It's safe to say that gate space and slots at DCA/LGA/BOS (that which Branson wants) are the most valuable part of the franchise at the current time. Selling those will certainly crimp the plan for the "hybrid" model.

 

[Phoenix]

US Airways May Become Major Shareholder In Virgin USA

US Airways spokesman: “We are not in any discussions with Virgin USA or any other Virgin representativesâ€￾

LONDON (Dow Jones) - US Airways could become a major shareholder in the new low cost start-up Virgin USA, said Virgin Group Chairman Richard Branson Tuesday.

See Story

Regards,

USA320Pilot

OK. Let me get this straight. "US Air is gonna liquidate." US Air is gonna buy major shares. So wich is it? Are we broke or not?


You flip like a fish out of water.

 

[Bob Owens]

US Airways May Become Major Shareholder In Virgin USA

US Airways spokesman: “We are not in any discussions with Virgin USA or any other Virgin representativesâ€￾

LONDON (Dow Jones) - US Airways could become a major shareholder in the new low cost start-up Virgin USA, said Virgin Group Chairman Richard Branson Tuesday.

See Story

Regards,

USA320Pilot

OK. Let me get this straight. "US Air is gonna liquidate." US Air is gonna buy major shares. So wich is it? Are we broke or not?


You flip like a fish out of water.

USA320 Pilots says "I am not a fish, I am a kept man!


"We are not in any discussions with Virgin USA or any other Virgin representativesâ€￾

Instead they are checking out the non-vigin representatives.

 

[mweiss]

Ya know, I kinda hate to do this, because it could be throwing gasoline on the flames. But I'm going to say up front that this is pure SWAG on my part.

What US Airways has slots, gates, and A319/320/321s that could be of interest to Virgin USA. Virgin cannot be majority-owned by a foreign entity. So what if US Airways sold the slots, gates, and Airbuses to Virgin in exchange for equity in the new company? If they did that, US Airways could be reduced to a shell company whose sole purpose is to own enough of Virgin USA to keep the new airline legal.

If I were a US Airways shareholder, this is probably the solution I'd be looking for. It's better than getting cash for those assets, because there's this perception that whatever Richard Branson touches turns to gold. And it would solve all of the deeply-ingrained problems that US Airways has.

As I said, it's pure speculation. But it would make sense based on the sorts of things we've been seeing, wouldn't it?

 

[BoeingBoy]

mweiss,

That's the best SWAG I've seen in a long time. All the pieces kinda fall into place.

Jim