USAirways tests Delta's interest in a Merger

[WorldTraveler]

If anything, I would suggest that AA might want to combine with AS - a high quality carrier that when combined with AA would have a dominant position on the west coast. AA's only need is Asia but they could easily grow it themselves using their own hubs.

If AA places a significant order for a widebody that could either replace the 777 on the Atlantic and to Latin America or could fly throughout Asia, you will quickly see AA take a leadership role in Asia.

For some strange reason, AA seems to be growing very slowly to Asia while holding onto their boatloads of cash. Perhaps they think they will buy their way into Asia but I doubt they could acquire a position as easily as they could grow it. But you've gotta believe at some point they will no longer see a need to hoard cash and make a move to Asia.

Most of the conventional wisdom about who will acquire who in the next phase of industry consolidation is probably all wrong.

 

[superG]

I think except for getting a pacific rim operation, AA has no desire to grow further. There is a certain market saturation. How many hub operations does a carrier really need? They seems to be tightening up there operation and growing their strengths.

One thing for sure...there's nothing of US that the 'big 5' would want except the southeast/caribbean route system from CLT, which may complement the routes/fleets of NW or UA.

 

[FlyUs]

One thing for sure...there's nothing of US that the 'big 5' would want except the southeast/caribbean route system from CLT, which may complement the routes/fleets of NW or UA.

you don't really believe that, do you? how about market dominance on the east coast and now with hp, the west as well.

 

[FWAAA]

AA's only need is Asia but they could easily grow it themselves using their own hubs.

If AA places a significant order for a widebody that could either replace the 777 on the Atlantic and to Latin America or could fly throughout Asia, you will quickly see AA take a leadership role in Asia.

For some strange reason, AA seems to be growing very slowly to Asia while holding onto their boatloads of cash. Perhaps they think they will buy their way into Asia but I doubt they could acquire a position as easily as they could grow it. But you've gotta believe at some point they will no longer see a need to hoard cash and make a move to Asia.

What a bizzare airliners.net type of post, WT.

The only really desirable part of Asia is Japan and China, and AA is growing those two as quickly as it can without purchasing someone else's Japan and China ops.

"For some strange reason?" That strange (to you, and you only) reason is that AA hasn't officially released any notice of its intentions to buy NW (to get its Japan and China assets).

 

[USCREW]

What a bizzare airliners.net type of post, WT.

Interesting that you should say that. I always thought that most over there are wanna-be, clueless types. JustPlaneNews is even worst with pathetic whining losers.

 

[WorldTraveler]

What a bizzare airliners.net type of post, WT.

Funny. That same discussion was held on USAviation and went on for pages and pages. I don't suppose you contributed to it.

I hope you're not disappointed if NW emerges successfully and doesn't sell to AA. But if they do, I truly pit the folks at NW that will be chewed up and spit out just like AA has done with every post-deregulation merger it has engaged in.

Perhaps AA can throw enough cash at NW's creditors to convince them that an AA acquisition would be in their best interest but it's going to have to be alot of cash. NW is profitable now so the hurdle for a better deal is higher.

And you have yet to tell me or anyone how AA is going to acquire NW without touching any of those horribly loathed Airbus aircraft. How will they do it, oh wise one?

 

[UseYourHead]

AWA Parkers recent comments about mergers on conference calls indicate that mergering with DAL or NWA while in bankruptcy would allow the combined entity to do things like return aircraft to lessors, as well as just about any other financial commitment as US Airays did.

After the merger of AWA/US while US was still in bankruptcy US parked 60 jets, a total of 15% of the combined fleet, while at the same time servering all the markets prior to the merger with 15% aircraft.

AWA/US had very little overlap of routes, with DAL having a 50% overlap can you imagine the amount of capacity that would be removed (of course only to be filled in by all of the Low Cost Airlines as they take aircraft?

The very bad news is that if this were to happen it would be downsizing of DAL through the court system...not a good thing...been there done that for the last few years at US.

We had 450 +/- jets pre-911, the fleet dropped to near 220 by the merger and now stands at a combined fleet of about 360 mainline jets...

I don't think the call to Delta was made with the intention of merging with US. IMO, Parker was just checking things out. Delta and US overlap over 50%. Not a lot to be gained here. The best fit for US would be UA then NW. AA would also work.

 

[superG]

you don't really believe that, do you? how about market dominance on the east coast and now with hp, the west as well.

UA/AK/WN have better west coast route systems, and as far as the east, as much as I hate ATL, DL's is superior.

 

[FlyUs]

UA/AK/WN have better west coast route systems, and as far as the east, as much as I hate ATL, DL's is superior.

superior how?

 

[Hula Girl]

I don't put much value in customer service indicators these days. I watched for years Airtran operate with dingy gates, dingy planes, staff that just got off some sort of criminal probation, and cops on stand by at their ticket counter to quell small riots, and customers such as real live hookers on their way to LAS conventions...LOL. Yet here they are making money. It's a commodity these days.

I flew Airtran a couple of weeks ago and had an outstanding experience. Clean planes, good attitudes and smiling faces. And an on time departure and early arrival to boot. Life is too short to be bitter, artiefukin.

 

[AstroLounge]

superior how?

Really....there is NO Way US would be interested in DL. (Too much overlap and ATL/CLT are too close). Don't be surprised if the alleged "Talks" were about brokering some type of deal between DL-CO and US-NW in a "What if scenario". CO is a well run operation but their hands are tied to previous dealings with NW and most sources say NW has the final say in matters. As for US-UAL, the code share continues as does the Star Alliance and there doesn't appear to be any indication that either will be terminating the arrangement. (DL and US isn't even a remote possibility, IMO)

 

[Don Smith]

A fleet incompatibility nightmare.....try NWA instead.

Oh by all means try nwa. No agreements with maintenance and F/A groups. Deep in BK with no exit date. No real plan of profitability. Their feeder regionals are also in BK (Mesaba) and can't get a labor agreement signed. Some compatibility with Airbus and 757 fleets but a financial nightmare. nwa needs someone to merge with to pull it's keister out of the fire but with the management structure in a nosedive any smart execs shouldn't touch it.

 

[WorldTraveler]

NW is successfully restructuring and reporting profits. They are as likely to survive long-term as anyone else in the industry unless they choose to sell themselves, which still might be in the creditors' best interests.

 

[robbedagain]

I thought NW posted losses in the first quarter of this yr and all of last yr? How could they be posting profits when they got huge expenses in ch11 not to mention fuel and now facing CHAOS from F/As and the ongoing strike by AMFA? It doesnt sound like they are able to turn a profit to me

 

[flyhigh]

It seems that a lot of this consolidation talk is just that. I don't see US/DL getting together as it would just be a nightmare. You'd have to get rid of a lot of people (ATL or CLT has to close, as does SLC). Add to that the fleet issues and you're just taking on too much. AA is hoarding cash to be prepared for one of two things...if pension relief comes through, they can pay some debt. If not, the money goes to the pensions. Best case scenario, pension relief goes through and NW fails...AA buys pacific unit. I think a CO/DL merger is a better fit and UA goes with the new US...but again, I think it's all talk