Delta Looking at US Airways

[USFlyer]

FWIW, PHL and JFK/LGA do not overlap. Both have material O&D traffic.

Part of this play is also to reduce competition. With fuel costs as-is, the airlines have switched back to preferring mainline metal. So, where DL and US use RJs to some cities now, a combined DL+US could fly mainline jets to one hub instead of two (ATL and CLT).

I still think this has a remote chance of being approved, but the play here would be to reduce competition and further the ability to shift more traffic onto mainline jets and away from RJs.

 

[Maark767]

FWIW, PHL and JFK/LGA do not overlap. Both have material O&D traffic.

Part of this play is also to reduce competition. With fuel costs as-is, the airlines have switched back to preferring mainline metal. So, where DL and US use RJs to some cities now, a combined DL+US could fly mainline jets to one hub instead of two (ATL and CLT).

I still think this has a remote chance of being approved, but the play here would be to reduce competition and further the ability to shift more traffic onto mainline jets and away from RJs.

Good point! The RJs are on their way out...... maybe this is good for DL/US.

 

[Airline Employee]

I guess this shows that DL really is afraid of a US/AA merger and they'll try anything to stop it. If US falls for it then while DL/US are trying to get DOJ, the DOJ will oppose the DL/US hookup and meanwhile AA will slip out of BK on its own. DL could also be trying to get UA/CO interested in merging with US. If that happens then DL can either go after AA's assets on their own or buy them outright while keeping the companies separate ( No union contamination from AA's unions). So I guess it's up to UA/CO as to if they will get in on this crazy merger mania.

 

[28L_or_10R?]

^Awesome^

Will the number of US and former NW fleet service surpass that of DL fleet service? That would be the only way I see of keeping IAM in this situation.

 

[USA320Pilot]

I guess this shows that DL really is afraid of a US/AA merger and they'll try anything to stop it. If US falls for it then while DL/US are trying to get DOJ, the DOJ will oppose the DL/US hookup and meanwhile AA will slip out of BK on its own. DL could also be trying to get UA/CO interested in merging with US. If that happens then DL can either go after AA's assets on their own or buy them outright while keeping the companies separate ( No union contamination from AA's unions). So I guess it's up to UA/CO as to if they will get in on this crazy merger mania.

I believe there is more to this report than Delta exploring a possible bid to purchase US Airways.

One option is the investment community and people looking to profit off of additional industry M&A activity may be pushing Doug Parker and Tom Horton to make a deal sooner rather than later by publicly floating the idea Delta may be interested in acquiring US Airways. Who is this person, who was not authorized to speak publicly, about the matter that contacted the WSJ?

AMR told investors, analysts, employees, and the news media of the company's desire to remain independent. US Airways told analysts on Wednesday it hired three merger advisers: Investment Bankers Millstein & Co. and Barclays Capital; along with the law firm of Latham & Watkins to study an AMR merger.

However, Parker said on the company's recent analyst conference call "We expect AMR will remain in bankruptcy for quite some time, and therefore, we anticipate that we and our advisors will be studying the situation for quite some time. And while we're studying the situation, we do not expect there will be any major developments, and we certainly have nothing to report today."

Could Delta be truly interested in US Airways? Yes. Could investors looking to make a quick profit be trying to put the companies in play? Yes.

Or maybe Delta wants pieces of American or US Airways to cherry pick parts of one or either company to bolster its network.

Or could this person, who was not authorized to speak publicly, be trying to move BA forward to provide an investment into the AMR-US Airways transaction? If Delta and US Airways merged how would this effect the 3 major international alliances?

I do believe if Delta acquired with US Airways without too many carve outs AMR would be a distant fourth large player behind Delta, United, Continental, and Southwest.

With a lot of M&A talk it seems logical that more industry consolidation may occur.

USA320Pilot

 

[767jetz]

How long before some USASPA supporter asks a DL crew where he can get his DOH 747 manual?

Not long. Trust me!

 

[Kittyhawk]

If DL is serious about a tieup with US, I would not be at all suprised to see UA throwing there hat into the ring and keep everything in the Star Alliance. That would have a much better chance of approval than DL/AA.

 

[signals]

Just like the boy who cried wolf, a merger may come and devour the airline who cried merger. Delta was always my choice, and I predicted a successful Parker move on the part of Delta.

 

[767one]

Most plausible decription so far.

I agree. It could never happen before I leave but I would have enjoyed wearing the Delta costume even for one day. 40 years ago I was too short to be hired by them and now I'm even shorter. I'm sure it would be most embarassing to Delta management to have someone as short as a leprechaun walking around in their costume.

posted in jest

 

[767one]

FWIW, PHL and JFK/LGA do not overlap. Both have material O&D traffic.

Part of this play is also to reduce competition. With fuel costs as-is, the airlines have switched back to preferring mainline metal. So, where DL and US use RJs to some cities now, a combined DL+US could fly mainline jets to one hub instead of two (ATL and CLT).

I still think this has a remote chance of being approved, but the play here would be to reduce competition and further the ability to shift more traffic onto mainline jets and away from RJs.

That would be against USAirways management style because they like to force passengers away from mainline and on to the RJ's. At U the mainline is here to feed the RJ's.

 

[Real tired]

This tie up would be great for the Mechanics.

The scabs of Northwest, that the IAM helped create, as my possible new co- workers.

How fitting.

 

[LD3]

I agree. It could never happen before I leave but I would have enjoyed wearing the Delta costume even for one day. 40 years ago I was too short to be hired by them and now I'm even shorter. I'm sure it would be most embarassing to Delta management to have someone as short as a leprechaun walking around in their costume.

posted in jest

Delta MTC would be more than happy to clamp some 4x4's to the rudder pedals.... 😀

 

[Phoenix]

With LOA 93 wages on the table and the opportunity to consolodate (i.e. furlough) every management wants to explore a merger with USAir.

Or maybe they have their eye on that profit behemoth hub in PHX.;-)

 

[NYCDelta]

I think this is just DL looking at all the options. It's clear there will be more consolidation going forward. Now that the DL/NW FA's will be flying together as of May01, DL has pretty much finished their merger with NW.
I don't care what the paintjob is, I just hope there aren't job losses. Airline employees have dealt with quite a bit over the years: BK's, wage cuts, furloughs, mergers, base closures, lost pensions, etc. Whatever happens, I hope that there can eventually be some stability and normalcy for airline folks.

 

[signals]

So basically it's Delta getting US Airways hopes up. Another merger-wolf at the expense of the merger crowd! 🙄