3 Reasons To Nix This Merger

swamt

Veteran
Oct 23, 2010
12,478
4,835
3 Reasons To Nix This Merger


The above article could very well happen. I remember where some of us were talking about only reading articles that said most all see good things and a must to merge. Just wanted to post some that are now starting to come out as a negative to merge.
US could very easily drop AA as a bad habbit and watch them go by the waste side to pick up scraps later. Maybe US air could look at Fronteir (for sale) and either JB or how bout American Eagle (also for sale). Alaska is also very profitable and doing well, you never know guys. There will be more mergers, buy-outs ect... It's a matter of who and who will get tied up.
 
By far the funniest thing I have seen or read on this forum......I have seen alot. Merger not happening, believable. Merger happening, believable. AA passing on US, believable. US passing on AA.......LMFAO!!!!

Seriously? Seriously? Happens all the time, boy chases girl for year, and right before she makes her decision, boy walks away. Righttttttttt.

Cheers,
777 / 767 / 757
 
  • Like
Reactions: 3 people
I agree.

777 is making the mistake of using logic (and, some would argue, business acumen) to draw a rational conclusion. That makes sense in most of the world, but not in Parker's...
 
what cannot be denied is that US is running a good airline as a business and from an operational perspective. Whether LCC investors will be any less convinced they need to merge with AA remains to be seen, but US clearly doesn't need to merge w/ anyone to be able to run a viable business. Whether US remains at a strategic disadvantage to the big 3 is not clear but they have clearly carved out a place for themselves in the industry. When you consider that US is doing what they are doing outside of the joint ventures in the int'l arena that the big 3 have, US' progress is commendable. With the right aircraft, US could begin working on the one piece of its network which it does not have - Asia service. PHL and PHX are both capable of supporting at least NRT flights, even on a simple codeshare basis.

US employees would still undoubtedly benefit from a merger with AA thru pay raises but US does need AA in order to justify pay raises to its employees.

Given that most people have long seen this merger being driven by US' need for AA rather than the other way around, investors really should be asking if the risks of a merger are really worth it compared to what each carrier could do on its own.

And the question really has to be asked if the other network carriers are better off having an independent US competing against them or if they would be better served by one of them buying US.
 
  • Like
Reactions: 3 people
It would be much better if US just picked up the pieces that would enhance the US franchise ie. the ORD hub and other goodies. It would be a lot better for US to hire off the street and train the employees the US way rather than have to deal with the arrogant toothless AMR trash but ...oh well.

The problem with that is US would be most certainly out bid for any good real estate by DL and UA.

So it is better to go this route and tie up the whole mess so that it can be sorted out by the US management. I am no fan of mergers, but having gone through so many, this one will just be the latest pain to deal with. Had I not had to endure PSA, Piedmont, Eastern/Trump, and AWA, I would have quite easily been in the top 15 percent of the seniority roster. So for me, only date of hire will work with APFA. Only time will tell. If this whole thing falls through that would be fine too.
 
  • Like
Reactions: 1 person
I think it was 777 / 767 / 757 who said in a earlier post that it was arpey and his leadership style that ran us into BK, and that Horton should be given a chance to succeed. i tend to agree with that.
 
I find it funny that this person could only come up with 3 reasons to nix a merger that hasn't yet happened. I still want the rights to the next Airplane movie :rolleyes:
 
perhaps the best solution for all involved would be for US to move to oneworld, admit US to AA's joint ventures, and allow both companies to continue to be independent.

NW and CO worked very well together for years - perhaps the best example of partnership between two large US airlines.

There is nothing that would stop AA and US from building a relationship as good as what NW-CO had and perhaps better. Just like with NW/CO, AA and US each have strengths they can contribute to the partnership. However, also like CO/NW, AA and US are very different airlines w/ very different cultures. Cooperate on the things that enhance competitiveness in the marketplace and leave the other issues alone.
 
  • Like
Reactions: 4 people
It would be much better if US just picked up the pieces that would enhance the US franchise ie. the ORD hub and other goodies. It would be a lot better for US to hire off the street and train the employees the US way rather than have to deal with the arrogant toothless AMR trash but ...oh well.

The problem with that is US would be most certainly out bid for any good real estate by DL and UA.

So it is better to go this route and tie up the whole mess so that it can be sorted out by the US management. I am no fan of mergers, but having gone through so many, this one will just be the latest pain to deal with. Had I not had to endure PSA, Piedmont, Eastern/Trump, and AWA, I would have quite easily been in the top 15 percent of the seniority roster. So for me, only date of hire will work with APFA. Only time will tell. If this whole thing falls through that would be fine too.

Only trashy people call other people trash.
 
  • Like
Reactions: 1 person
Jim,

Sorry to have insulted you or your coworkers. Trash, was a bad choice of words. But you get the drift...as has already been indicated when some of your AA brethren refer to US being the lesser corporate entity.

In this case I was defending the progress US has made. A merger with AA was just never thought of among the US folks. Unfortuntely here we are about to tie the knot according to most people.

From my perspective all this merger will do for me is just add more stuff to deal with. And as in other mergers someone always spouts off "well at __________ airlines we did it this way", or "_________ airlines was better than your airline". After so many mergers you can fill in the blank with whatever airline you want it is all the same.

So, I apologize if the word, Trash, offended you. See you on the line (maybe).
 
what cannot be denied is that US is running a good airline as a business and from an operational perspective. Whether LCC investors will be any less convinced they need to merge with AA remains to be seen, but US clearly doesn't need to merge w/ anyone to be able to run a viable business. Whether US remains at a strategic disadvantage to the big 3 is not clear but they have clearly carved out a place for themselves in the industry. When you consider that US is doing what they are doing outside of the joint ventures in the int'l arena that the big 3 have, US' progress is commendable. With the right aircraft, US could begin working on the one piece of its network which it does not have - Asia service. PHL and PHX are both capable of supporting at least NRT flights, even on a simple codeshare basis.

US employees would still undoubtedly benefit from a merger with AA thru pay raises but US does need AA in order to justify pay raises to its employees.

Given that most people have long seen this merger being driven by US' need for AA rather than the other way around, investors really should be asking if the risks of a merger are really worth it compared to what each carrier could do on its own.

And the question really has to be asked if the other network carriers are better off having an independent US competing against them or if they would be better served by one of them buying US.

The place that US has carved out is being invaded by other carriers, both legacy and low cost carriers. It was not too long ago that US owned the northeast. Much of that dominance has vanished.
Perhaps a better plan for US would be to acquire Frontier and build up its weak mid west route map.
I still remember reading where US has a big financial note due in 2014 and this along with Parker's ego trip may be the reasons for US's frantic push to consummate this merger.
When US started to charge for water but then dropped it but still charges a fee to redeem frequent flyer miles tells me AA should stay a stand alone carrier. Just my thoughts.
 
  • Like
Reactions: 1 person
See you on the line (maybe).

Maybe, maybe not. I have a close friend who is a senior f/a at LCC based at CLT. His only comment when this merger talk first started was, "God, I hope you all don't get pulled into this mess over here." The main problem I see is that some of you (collective you, not the personal you) seem to think that a merger with AA will bring a solution to the otherwise intractable pilot seniority issue at LCC. I doubt it. When a group will ignore the decision in a binding arbitration that they demanded, what makes you think they will adhere to any future decision they don't happen to like. LCC East pilots seem to think that binding arbitration is binding only if you happen to like the decision of the arbitrator. And, when a group of approximately 6000 pilots is merged into a group almost twice as large--even if done on straight date of hire--I'm guessing that there will be a lot of those pilots in the "ignore binding arbitration" group that are going to have their panties in a wad. They are probably going to play the "career expectations" card that they have decided that Mr. Nicolau and the US West pilots had no right to play.

Also, Mr. Parker has shown himself to be capable of running two separate airlines under one name and make a profit. Running three separate airlines with one name should not be that much of a stretch for him. Also, he made some major financial promises to the AMR unions. In order to follow through with those promises, he's going to have to provide the same benefits to the LCC folk. Now, he has made it clear with the 3rd TA that he can not pay you any more money. Where is the money coming from to fulfill his promises to us?

Are any of you so naive as to believe that a merger will instantly provide a fountain of new cash? If past airline merger history is any indication, there will be at least a year of bleeding cash with inefficient operations/connections/etc, layoff payoffs, and duplication of jobs and work efforts. Does either airline have a year to bleed cash? I don't think so. AMR has already committed those billions they have squirreled away on new airplanes to be delivered over the next few years. They specifically did not intend to spend a dime of it on employees. They have made that more than clear. So, where is the money coming from? As the movie said, "Show me the money."

My suggestion to US Airways AND Delta AND United is just wait. AMR management has so poisoned the well of employe relations that there is probably nothing they can do to regain the trust and support of the front line employees. No company can survive that kind of situation for long. Then when AMR goes back into bankruptcy (for real next time) and is shown to not be a viable operation for the future, the rest of you can pick up the parts you want at the yard sale.

AMR management truly believes that the only reason their vaunted "cornerstone strategy" didn't work is because they paid the employees too much. The fact that a lot of their long time passengers have no intention of riding a Barbie jet to some overcrowded, delay-prone airport in order to have to connect to a flight to wherever they want to go is no consequence to them. The passengers have gone to other carriers because AMR pays it's frontline employees too much. Weather delays at DFW and ORD are the direct result of bloated payrolls. The employees are being paid too much. End of discussion.

(Note to company cheerleaders, FWAAA and Eolesen: Keep the pleated skirts and the pom poms in the closet. I don't care how comfortable you think the larger rjets are. There ain't that many of them yet. We've already lost whole cities of business due to the "cornerstone" strategy. And, once business passengers find out how comfortable WN jets are, how friendly and cordial their flight attendants are, and how convenient their "older" airports are to the city center, we ain't gonna win them back. And, since WN is now flying into major airports also, it won't be much of a stretch to switch to another airline for an international connection.)
 
  • Like
Reactions: 2 people
So, where is the money coming from? That is the question we are all asking ourselves. Profit margins are already painfully thin. Could this be a case of just juggling the debt onto other credit cards and waiting til the terms of management payouts are executed? I hope for both our sakes that isn't the case.

I believe we will be ok in a merger for awhile. To be honest with you this ship needs to sail for about 10 years. The only reason why I care is totally selfish, I just want to reach retirement age and go. Good luck to us all.
 
Well, you see I'm already retirement age. This is my 5th career. If I didn't enjoy being on the airplane with the passengers I wouldn't put up with the management crap for 5 minutes. And, you can't ask where is the money coming from. I asked first. :lol:

I've yet to see any indication that Parker has a source of funds other than his current profits which would not come anywhere close to paying all of us and you what he has promised. His profits are rooted in the fact that his two largest employee groups are paid well below industry standard. If you have a way of obtaining gross LCC payroll numbers, take those numbers and multiply by the AMR pilot/flight attendant pay rates, and see if LCC still makes a profit. It does not. Not even close.