AA/US continuation of good trend

[BoeingBoy]

For September, the latest month reported, WN alone had approximately a 17% advantage over DL in domestic enplaned passengers. Add FL and WN together and it grows to a about a 34% advantage domesticly. That's a large hill to climb for DL to take #1.

Jim

 

[WorldTraveler]

For September, the latest month reported, WN alone had approximately a 17% advantage over DL in domestic enplaned passengers. Add FL and WN together and it grows to a about a 34% advantage domesticly. That's a large hill to climb for DL to take #1.

Jim

I agree on the counts you have included but it still remains that WN's only basis for superiority is enplaned DOMESTIC passengers. If you include int'l traffic then they are not number one anymore. And while enplaned passengers is the metric that WN wants to use to claim its size advantage, they are surpassed by both DL and UA (and maybe AA, I'd have to double check) when it comes to domestic revenue and domestic RPMs. Winning the title of most enplaned passengers isn't such a great title if someone else takes in more money - and based on recent data - probably makes more money carrying fewer passengers.
And then there is the whole artificial designation about operating carrier which excludes passengers carried by regional carriers even though almost all of the regional flying is done under contract for the mainline carrier who is fully responsible financially for everything revenue related w/ regards to passengers.
Just as with on-time statistics, regional carriers that fly for mainline carriers should be included in the data for them.
Data for a carrier like Skywest is rather meaningless given that they fly for multiple mainline carriers.

 

[AAviator]

From the article:
Neither airline has indicated it is pushing for such a combination.

American has until the end of February to file its own bankruptcy-reorganization plan before facing any potential offers.

So merger-wolf season ends at the end of February 😛

Shades of the "Crystal Palace court Jesters" USair, American merger, a "Phased integration"?

C'mon somebody has to have a copy of CM's earlier work!! Bring it out!!!!

On a related note, today reuters is reporting numerous AA jets have been seen landing at airports known to handle USAirways flights, lending further credence to the conspiracy. Stand by for further developments! 😀 😀

 

[NYCDelta]

The new AA-US now have strategic advantage on the east coast with competitive solution to DL by having a domestic/intl' hub in JFK and PHL while carrying a large market presence at LGA (now #2 behind DL). The combination has surrounded the DL northeast ops with intl hubs both in and south of the NYC metro area providing N.J. customers ease and convenient options for travel to Europe. Now AA-US have a strong well oiled and established southern hub a competitive response to both DL and WN out of ATL with natural south american flow thru MIA. So now DL is trumped and muted in the NE and SE...except AA still has the middle part of the country with hubs in DFW and ORD (DL does not). Moving westward now you have a direct competitive response to DL's SLC by the AA hub in PHX not to mention the LAX ops. Lest we not forget about the advantage AA now has in the Nation's capitol...This tie up would be most inconvenient for DL...Moving on....

Back to crystal ball: AA and US feud like the Hatfield's and McCoy's...no merger. Neither organizations assets are fully realized (as you pointed out about US at LGA) and revenue is lost to DL, UA and the rest. AA employees hate their company even more because they never get a break working under the wage and work rule set they accepted. Profits never seem to be as robust as was predicted. So enter JBLU, and AA finally gets some leverage out of the NYC market. Enter Alaska, AA finally gets leverage on the west coast. But at what price, inconvenience and headaches for the two mergers? Poor little slot rich US now has to fend for itself...Enter DL and UA and insert name of any other airline with a big check book and very quickly snaps up the good stuff for themselves. And all the US haters' scream hoo-ray for our side. So, Where does that leave AA? my guess would be in the same boat as they are now, at a competitive disadvantage. Who wins in this scenario? DL,UA,WN. Just my humble opinion.

Good analysis; I don't fully agree, but it was good reading. If past mergers are a precedent, though, it is highly unlikely that an AA/US merger would result with all hubs and/or focus cities intact. I would think the new AA/US would focus on JFK/LGA to the detriment of PHL. MIA would gain at the expense of CLT. DCA would probably be OK. PHX would be toast. ORD, DFW would survive. LAX would continue to grow. But the biggest integration nightmare (labor) would be like Eastern Air Lines redux. Just my 0.02
If AA in BK gets it right, I think they will once again be a formidable competitor. Even so, if we end up with just 3 large legacies (as most are predicting) I see it being UA,DL,AA-in that order, for the foreseeable future. Each one has its strengths and weaknesses, but once all are on equal footing on a cost/revenue basis, I think they will coexist nicely, and continue to focus on their respective alliances.

DL has focused most of its attention over the past 5 years on the east coast and esp. NYC... now that the slot swap is settled and DL's largest growth is completed in the NE, it is likely they will focus attention on the west coast which is their weakest domestic region..

Indeed, that is what Richard Anderson has said DL will focus on in 2012. Once and for all, DL needs to make a decision on LAX; they can't keep starting/stopping service every other week to various destinations. There is a reason for the "DL Dartboard" reputation.
I also think SEA and DL's extensive relationship with AS will continue to grow closer, thus allowing DL to hold their own in SEA.
As for UA, Smisek himself has said that if he had his way (and he probably will) domestic flying would only serve to feed international. I think you will see UA continue to focus on international and if they can get an agreement with our pilots, hand more domestic over to Express.

I'm in my fifth decade in this business, so spare me your advice please. I'll be fine. But I do have a question. Was DL not able to figure out how to use their slots at DCA, as you say US was unable to do at LGA?

In a word: yes.

 

[WorldTraveler]

Labor and finances are the biggest risk to a AA/US merger... unless it is a consensual stock merger (and I think DL and UA will throw in cash to ensure that there is a real price paid for assets - I wouldn't be surprised if both are already making (or will make) offers to AA for certain assets such as MIA-Latin America just to establish that there is a cash value for some of AA's assets... and the creditors would be foolish to not consider options that involve asset sales... doesn't mean they would end up being what happens but it is highly possible that AA's LHR and Latin America operations could be sold for billions of dollars and the assumption of a lot of debt... that is stuff creditors don't just write off as insignificant. US will have to compete with the potential for those types of deals.
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DL has really fairly consistently maintained its revenue share of LAX... they have added alot of destinations and pulled them but most have been one or two flights/day at most using aircraft that would have been parked anyway.... the buildup and pulldown of LAX has had almost no effect on DL's financial or passenger share at LAX.
Also, a big park of DL's buildup with RJs during BK was to keep a minimum level of flying in order to keep LAX from taking any gates... the strategy worked.
DL has ALWAYS focused attention first on the east coast... LAX and the west coast will get their time in the sun... and I can't help but agree that DL will be making moves to consolidate its position on the west coast, very possibly w/ an acquisition of AS while AA is in no position to counter (which they can't in BK).. right now, there are a number of strategic possibilities on the horizon including Virgin Atlantic, AS, and potential AA asset acquisitions... some of that may play out during 2012 and that also be part of why DL has no major strategic growth plans since right now putting money in the bank is the most important thing to do.
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It will be interesting to watch what UA does long term w/ domestic but it is true that CO never had much interest for the domestic market although even as the most int'l carrier, half of CO's revenue still came from domestic markets. The strength of UA's network comes from its position in key markets - and there is no reason to doubt that other competitors aren't fully prepared to jump into those where possible... the buildup of new carriers at ORD over the past year has been remarkable. VX will always have reason to grow in California....
.

 

[wings396]

Heck, I think that Delta should just buy everyone and everything that they can. All of the other US airlines can just close up shop leaving Delta as the sole means of US air transportation, you know like Aeroflot. The only downside would be that you WT would no longer have anything to do without posting here and pounding your chest about how great the Delta Koolaide is...

 

[WorldTraveler]

but it's ok for us to talk about how it would be good for all for US to buy AA?

 

[FWAAA]

You can't blame the employees of US for wanting a merger to happen with one of the Big 3 legacy carriers. We know we are and have always been the weakest link in the industry. At least when it comes to route structure. I'm sure Tempe will do everything in it's power to make a deal happen with AA now that it is in Chap 11 bankruptcy. They'd be foolish not to. What would they have to lose? If done right, a much stronger industry will emerge and we'll all get bigger paychecks. That's the bottom line for most of us here. I still think US was foolish trying to acquire DAL instead of NW. A much more compatible fit.

I respect your opinion but I disagree about US adding little value. The east coast market share AA will gain with this merger would be huge. AA would definitely become a formidable competitor against DAL and any other lcc in this region with plenty of potential international expansion. And with one less carrier in the US, the industry would be able to price their product according to fair market value. We would become much stronger as one and get much needed raises.

If US and AA get together, it ain't gonna be about providing raises to anyone. AA is likely to slash its wages, salaries and benefits expense in bankruptcy and won't be providing raises for a while after exiting Ch 11, whether or not it's combined with US. If you want a raise, my advice is to work on your resume.

 

[NYCDelta]

.
DL has really fairly consistently maintained its revenue share of LAX... they have added alot of destinations and pulled them but most have been one or two flights/day at most using aircraft that would have been parked anyway.... the buildup and pulldown of LAX has had almost no effect on DL's financial or passenger share at LAX.
Also, a big park of DL's buildup with RJs during BK was to keep a minimum level of flying in order to keep LAX from taking any gates... the strategy worked.
DL has ALWAYS focused attention first on the east coast... LAX and the west coast will get their time in the sun... and I can't help but agree that DL will be making moves to consolidate its position on the west coast, very possibly w/ an acquisition of AS while AA is in no position to counter (which they can't in BK).. right now, there are a number of strategic possibilities on the horizon including Virgin Atlantic, AS, and potential AA asset acquisitions... some of that may play out during 2012 and that also be part of why DL has no major strategic growth plans since right now putting money in the bank is the most important thing to do.
.

Well, if DL's strategy is to use RJ's to hold gates at LAX and start/stop service to numerous destinations-then they have executed that strategy beautifully. I don't have a list of all these flight in front of me, nor do I have the time to find one, but I would venture to say that LAX has been built up and pulled down by DL on more than one occasion, and probably more so than any other airline. I'm happy that Anderson said that DL will focus on their LAX strategy in 2012: building on their relationships with China Southern, China Eastern, Virgin Australia, and AS. He also said they will focus on service in key business markets. DL needs to find a strategy at LAX and stick with it. Nothing you say will convince me that DL service to/from LAX has been erratic at best.

 

[USA320Pilot]

How the week's ahead will shape AMR in the years to come

Click here to read the story.

 

[WorldTraveler]

I'm not arguing whether DL has been erratic in building up and pulling down LAX or not - I don't disagree. I am saying that it really hasn't mattered whether DL has operated seasonal redeye service to CMH, RDU, and a whole bunch of other stuff which doesn't really move much revenue or not... if the flight covered direct operating costs (fuel, crew, landing fees), then it was operated - but it didn't make any sense to fly it year round. It is no different from what US is doing w/ their PHL-SLC or CLT-SLC service or what DL and other carriers including US did at LAS w/ lots of late night flying... some of it seasonal and some of it even day of week specific. At some cost levels it makes sense while at others it does not.
.
DL doesn't need to hold onto gates now because they now have NW's oepration in their terminal... but remember that ExpressJet's branded operation (whatever it was called) started ONT service to a bunch of airports...couldn't make it work so came knocking at DL's door to fly some fee for departure RJs and, could we also put our branded flying in LAX and put it under the DL code.... DL bore no risk for much of that flying but did have someone using its gates which is what they needed to keep LAWA from taking gates from DL during BK... the operator found the flights were losing money and wanted out.. which DL let them do as long as they cancelled the fee for departure RJ flying too..... (the details might be somewhat different but that was basically the gist).
.
DL has not chosen to be the #1 or #2 airline in the west... but they are #1 or #2 in the markets/market groups they serve among US network carriers ... including to/from the SE and Tokyo plus their hubs and then #2 among network carriers in other markets including to/from JFK (yes, DL carries more revenue LAX-JFK than UA) plus to Hawaii... that kind of strategy is the same that US uses to/from the west where they don't have the size to try to compete in every market or region... instead focusing on being large enough to matter in the markets they do serve (the #3 network airline in any market usually ends up w/ the scraps). Because LAX is still a very divided market - like BOS and LGA are as of now - that was acceptable in corporate accounts.
But the chances are very high that DL will pick up more LAX business as AA has to shed capacity during BK.
Interestingly, DL is #2 among network carriers in most of the rest of the west because AA's west coast strategy has largely revolved around LAX.
.
320pilot,
the advantage of not having DIP financing is offset by the competitive pressures AA faces to get out of BK or face hostile takeovers... thus, in the end I'm not sure that AA has the luxury to wait around for the right structures/deals as much as Swelberg thinks.
Further, having cash can be a disadvantage in negotiating deals, including with the PBGC.. but if AA has already determined that like DL it won't terminate but freeze pensions except perhaps w/ the pilot plan if the lump sum bonus cannot be removed after emerging from BK, then it may not matter if AA has as much cash at least w/ the PBGC.
How are US pilots going to view working side by side w/ pilots that haven't lost their pensions if that happens? and the same can be asked about any US labor group.

 

[signals]

How the week's ahead will shape AMR in the years to come

Click here to read the story.

The article proved that anUS merger is yet another dream for the US dreamers 🙄

 

[diamondcutter]

I'm not arguing whether DL has been erratic in building up and pulling down LAX or not - I don't disagree. I am saying that it really hasn't mattered whether DL has operated seasonal redeye service to CMH, RDU, and a whole bunch of other stuff which doesn't really move much revenue or not... if the flight covered direct operating costs (fuel, crew, landing fees), then it was operated - but it didn't make any sense to fly it year round. It is no different from what US is doing w/ their PHL-SLC or CLT-SLC service or what DL and other carriers including US did at LAS w/ lots of late night flying... some of it seasonal and some of it even day of week specific. At some cost levels it makes sense while at others it does not.
.
DL doesn't need to hold onto gates now because they now have NW's oepration in their terminal... but remember that ExpressJet's branded operation (whatever it was called) started ONT service to a bunch of airports...couldn't make it work so came knocking at DL's door to fly some fee for departure RJs and, could we also put our branded flying in LAX and put it under the DL code.... DL bore no risk for much of that flying but did have someone using its gates which is what they needed to keep LAWA from taking gates from DL during BK... the operator found the flights were losing money and wanted out.. which DL let them do as long as they cancelled the fee for departure RJ flying too..... (the details might be somewhat different but that was basically the gist).
.
DL has not chosen to be the #1 or #2 airline in the west... but they are #1 or #2 in the markets/market groups they serve among US network carriers ... including to/from the SE and Tokyo plus their hubs and then #2 among network carriers in other markets including to/from JFK (yes, DL carries more revenue LAX-JFK than UA) plus to Hawaii... that kind of strategy is the same that US uses to/from the west where they don't have the size to try to compete in every market or region... instead focusing on being large enough to matter in the markets they do serve (the #3 network airline in any market usually ends up w/ the scraps). Because LAX is still a very divided market - like BOS and LGA are as of now - that was acceptable in corporate accounts.
But the chances are very high that DL will pick up more LAX business as AA has to shed capacity during BK.
Interestingly, DL is #2 among network carriers in most of the rest of the west because AA's west coast strategy has largely revolved around LAX.
.
320pilot,
the advantage of not having DIP financing is offset by the competitive pressures AA faces to get out of BK or face hostile takeovers... thus, in the end I'm not sure that AA has the luxury to wait around for the right structures/deals as much as Swelberg thinks.
Further, having cash can be a disadvantage in negotiating deals, including with the PBGC.. but if AA has already determined that like DL it won't terminate but freeze pensions except perhaps w/ the pilot plan if the lump sum bonus cannot be removed after emerging from BK, then it may not matter if AA has as much cash at least w/ the PBGC.
How are US pilots going to view working side by side w/ pilots that haven't lost their pensions if that happens? and the same can be asked about any US labor group.

DELTA DELTA DELTA ....Enough go over to the Delta board and cheer, debate, and use your Crystal ball over there. Your long winded dribble is self severing at best. Everyone on here gets it .....delta is your LIFE! Read the title of this thread.... The rest of us manage to stay on topic.

 

[AstroLounge]

DELTA DELTA DELTA ....Enough go over to the Delta board and cheer, debate, and use your Crystal ball over there. Your long winded dribble is self severing at best. Everyone on here gets it .....delta is your LIFE! Read the title of this thread.... The rest of us manage to stay on topic.

Thank You! This Clown REALLY Believes HE has the Insight on Everything. Talk about Being Full of S*it RIGHT Up to His Eyeballs! Stay on Your Delta site and keep your sorry arsced opinions to YOURSELF..........No One else cares to hear them ENLIGHTENED One!

 

[BoeingBoy]

It is entertaining watching WT spin his message. He brought up the #1 ranking by enplaned passengers, saying DL would surpass WN domesticly. When I pointed out that it would at best be a temporary victory and that WN would regain the title once they and FL reported as a single carrier, enplaned passengers became a meaningless metric to judge size. Classic WT - keep changing positions until reaching one that can't be refuted then ignore the previous positions and claim to have been right all along...

Jim