Consolidation

[operaations]

I do not wish any airline to go under and be forced to liquidate. But it seems to me that it needs to happen. More and more airlines go to CH 11 and seek protection. We gave up alot of pay, and benifits, and we as employees of AA are suffering the high cost of living with out any relief in sight. I dont know about anyone else but I think the only way a Large Airline will become profitable again is to see one or two of the Legacy Carriers go away. Not merge with anyone else just go away. Less seats in the air and more demand.

I am not looking for the usual Management bashing, or union bashing, just a discussion on opinions of consolidation.

 

[Fly]

I believe it will happen but I don't think it will happen quick enough to save ALL legacies from visiting the judge. Once the current bankrupties finish eliminating the pensions, AA and CAL will have no choice but to do the same.

Many airlines that go into BK have a hard time ever fully recovering, so some will probably disappear.....just not fast enough to save the "NOW" healthy (soon to be unhealthy) carriers.

 

[NewHampshire Black Bears]

I believe it will happen but I don't think it will happen quick enough to save ALL legacies from visiting the judge. Once the current bankrupties finish eliminating the pensions, AA and CAL will have no choice but to do the same.

Many airlines that go into BK have a hard time ever fully recovering, so some will probably disappear.....just not fast enough to save the "NOW" healthy (soon to be unhealthy) carriers.

[post="301131"][/post]​

+++++++++++++++++++++++++++++++++++++++++++++++++++++

FLY,

I definitely agree that "changes" will come fast and furious, now that 4 carriers are in BK.

Continental (IMHO) really becomes the test case.

As far as AA goes, given the historical DNA of AA, I feel that "by hook, or by crook", AA will stay out of BK, "BUT" there will be a #### load of $$$$ CHANGES that WILL occur, to keep them out.

Again, CO, becomes the "wild card", so to speak.

AND, like EVERYTHING ELSE AT AA, "Time will tell"

NH/BB's

 

[coolflyingfool]

There will be some consolidation in the industry, but probably not enough to make a huge difference. With these airlines flying routes that make extreme profits, there are routes that lose a lot. I just don't understand why airlines do not cut the routes which are the biggest loseres. Say that every airline cut their bottom 10 routes that lost money, that would reduce capicity, reduce headcount, reuce the amount of fuel purchased, and reduce the amount of money that the airline loses each day. I just don't understand this crazy world in which we live. Just my thoughts..............

 

[Wretched Wrench]

There would already be consolidation if the bankruptcy laws were not so advantageous to corporations. The bk laws should have been tightened up more tightly and sooner.

Bankruptcy is now used as a business strategy, sticking creditors, stockholders, employees and taxpayers with the consequences of poor management.

The too-little and too-late changes that go into effect next month may improve things a little, but it is too late for the airline industry.

Our government has been slowly drifting into corporatism, or a corporate kleptocracy for years.

 

[jimntx]

Assumption: If one or more of the legacy airlines goes to the great taxiway in the sky, the financial problems of the airlines would go away along with the current overcapacity.

Problem with Assumption: LCCs are still taking delivery on a/c--even Frontier which is losing money right now is taking delivery on 1 new a/c every month until next Spring sometime. Those a/c will be deployed to use on routes the LCCs don't currently fly.

Also, if GECAS were to suddenly find its "used airplane lot" overflowing, does anyone think that they would not offer some airline very attractive lease rates? Say, along the lines of the "you pay what we pay" promotions of GM and Ford.

Overcapacity, though not a minor issue, is not nearly as big a problem as is the selling of seats for less than it costs to transport the occupying butt from Point A to Point B. Solution is either to reduce costs or raise ticket prices. NWA has been the main preventer of the second option over the past year or so.

I'm afraid that down the road, the "legacy" carriers will abandon 2nd and 3rd tier cities that are marginally profitable (or marginally money losing), and the LCCs will NOT move in for that very same reason. SWA has not become as successful as it is by serving routes that don't make money.

 

[DFWCC]

"Reduce flying, cut routes, too much capacity" is about all I've heard in the last couple of yrs. Well seems to me all the legacies have followed that plan. Problem is no-one informed the LCCs. While we shrunk the LCCs have continued to expand and are buying aircraft as fast as they can. They need them to fill in all the reductions by the legacies.
What really is needed is some form of reregulation.
The airline industry used to be a great place to work with good bennies but the great democratic President Jimmy Carter (yeah right) signed the Airline Deregulation act of 1978. Downhill ever sense.

 

[operaations]

What about a Delta AA merger. Or should AA go at it alone and concentrate on International flying and give Domestic to Eagle

 

[Thomas Paine]

"Reduce flying, cut routes, too much capacity" is about all I've heard in the last couple of yrs. Well seems to me all the legacies have followed that plan. Problem is no-one informed the LCCs. While we shrunk the LCCs have continued to expand and are buying aircraft as fast as they can. They need them to fill in all the reductions by the legacies.
What really is needed is some form of reregulation.
The airline industry used to be a great place to work with good bennies but the great democratic President Jimmy Carter (yeah right) signed the Airline Deregulation act of 1978. Downhill ever sense.

[post="301221"][/post]​

Actually wages and conditions continued to improve until Reagan fired Patco, allowed Continental to void out contracts through BK and permanently replace its workers.

 

[DFWCC]

Actually wages and conditions continued to improve until Reagan fired Patco, allowed Continental to void out contracts through BK and permanently replace its workers.

[post="301361"][/post]​

As much as I am for unions, I do not fault Pres Reagan for firing the PATCO wkrs.
There is no way any union should tell the Pres of the US to shove it after he warned them. They would not and could not win against the President. Why did they think they could ignore the President's warning? Did they beleive they could make the most pwerful man (position) in the world back down and embarass him because they were a union. It is the Office of the US President that I respect here more than any one man or union.

 

[Bob Owens]

DFWCC,Sep 16 2005, 02:48 AM]As much as I am for unions,

Which, judging from past posts,is not much I suppose.

I do not fault Pres Reagan for firing the PATCO wkrs.

No, but you fault Carter for Deregulation. The fact is Reagan made promises to Patco, even got Patcos support for the election however once in office he broke every promise. Is the President so poweful that us mere mortals should not expect him to be held to the same standards as everyone else?

There is no way any union should tell the Pres of the US to shove it after he warned them. They would not and could not win against the President. Why did they think they could ignore the President's warning? Did they beleive they could make the most pwerful man (position) in the world back down and embarass him  because they were a union. It is the Office of the US President that I respect here more than any one man or union.


So no one should stand against the President? How about Congress? The Senate, should they all bow down to him and kiss his feet?

 

[Thomas Paine]

As much as I am for unions, I do not fault Pres Reagan for firing the PATCO wkrs.
There is no way any union should tell the Pres of the US to shove it after he warned them. They would not and could not win against the President. Why did they think they could ignore the President's warning? Did they beleive they could make the most pwerful man (position) in the world back down and embarass him because they were a union. It is the Office of the US President that I respect here more than any one man or union.

[post="301386"][/post]​

The fact remains that is when the fortunes of labor started to decline. Justify it all you like, Reagan was the most anti-union President up until the current Bush.

 

[MOUNT KISCO]

The fact remains that is when the fortunes of labor started to decline. Justify it all you like, Reagan was the most anti-union President up until the current Bush.

[post="301401"][/post]​

Agree: but it was President Jimmy Carter ( D ) who signed deregulation into Law hence creating vampires like Lorenzo and Icahn to appear and leave their mark.

 

[goingboeing]

The fact remains that is when the fortunes of labor started to decline. Justify it all you like, Reagan was the most anti-union President up until the current Bush.

[post="301401"][/post]​

Excuse me,but the Teamsters Union supported Ronald Reagan in his 1984 re-election campaign.The Teamsters Union without debate,was the powerful Union ever at one time.[not present day terms]
I don't know what airline you worked for in the 1980's but my wages did nothing but go up,up,up.Look at the AA TWU ATD books in 1981 when RR took office and then look at the books again for 1989 and see what happened to TWU membership numbers.They were way up in number.How is increased membership bad for Unions?I thought the unions preached strength thru numbers.
GW Bush or his dad is not even worthy to be mentioned in the same page as Ronald Reagan.
The modern hack job on unions started when Bill CLINTON took away the AA pilots right to self help when they called a strike and BC ordered them back to work via Executive Order.GW Bush has just continued what BC started and is probably the worst President ever in modern times on all issues,not just organized labor issues.

 

[ta152]

I don't work in the airline industry but I like airplanes. I am curious why airline people always talk about mergers with other airlines when it seems like fuel prices are the down fall for many airlines. Why don't airline companies that are struggling try to hook up with companies like
Shell, Exxon, or Chevron ? You don't see oil companies going broke, just getting richer and richer. They could do it like Buick is a sub company of GM. Delta is a sub of Chevron. Just a thought. (now everybody can yell at me. 🙄 )