Failed US/DL merger likely to mute consolidation talk for now
Friday February 2, 2007
NEW YORK (ATWOnline) - Airline merger talk in the US market is expected to cool following US Airways' withdrawal of its offer for Delta Air Lines, particularly with many carriers posting their best earnings since the late 1990s.
US's attempt to acquire DL (ATWOnline, Feb. 1) forced other airlines to survey the landscape and explore merger possibilities themselves; American Airlines, Northwest Airlines, Continental Airlines and United Airlines all reportedly hired merger advisers. But with DL and NWA apparently on track to emerge from Chapter 11 later this year, the consolidation window may be closing, at least for the near term.
US Chairman and CEO Doug Parker said earlier this week that once DL emerges from bankruptcy, "I don't think you're going to see any consolidation in this business until the next down cycle." Several analysts said yesterday that merger talks are unlikely for at least six months to a year.
NWA President and CEO Doug Steenland said this week that the airline, a subject of merger speculation, plans to submit a plan of reorganization this month that will be "predicated on Northwest being a standalone, independent airline."
But US airline executives likely will continue eyeing mergers over the long term, particularly if earnings fall off. "Over the last two years I have met with almost every major airline CEO and I have heard most of them advocate for consolidation within the industry," Senate aviation subcommittee Chairman Jay Rockefeller (D-W.Va.) said, noting that cost-cutting "has been brutal...I know that our nation needs a financially healthy airline industry."
USA320Pilot asks: Will Doug Parker go after Northwest before the Eagan-based company emerges from bankruptcy? If so, he would need to do so in the not-to-distant future.
Regards,
USA320Pilot
Friday February 2, 2007
NEW YORK (ATWOnline) - Airline merger talk in the US market is expected to cool following US Airways' withdrawal of its offer for Delta Air Lines, particularly with many carriers posting their best earnings since the late 1990s.
US's attempt to acquire DL (ATWOnline, Feb. 1) forced other airlines to survey the landscape and explore merger possibilities themselves; American Airlines, Northwest Airlines, Continental Airlines and United Airlines all reportedly hired merger advisers. But with DL and NWA apparently on track to emerge from Chapter 11 later this year, the consolidation window may be closing, at least for the near term.
US Chairman and CEO Doug Parker said earlier this week that once DL emerges from bankruptcy, "I don't think you're going to see any consolidation in this business until the next down cycle." Several analysts said yesterday that merger talks are unlikely for at least six months to a year.
NWA President and CEO Doug Steenland said this week that the airline, a subject of merger speculation, plans to submit a plan of reorganization this month that will be "predicated on Northwest being a standalone, independent airline."
But US airline executives likely will continue eyeing mergers over the long term, particularly if earnings fall off. "Over the last two years I have met with almost every major airline CEO and I have heard most of them advocate for consolidation within the industry," Senate aviation subcommittee Chairman Jay Rockefeller (D-W.Va.) said, noting that cost-cutting "has been brutal...I know that our nation needs a financially healthy airline industry."
USA320Pilot asks: Will Doug Parker go after Northwest before the Eagan-based company emerges from bankruptcy? If so, he would need to do so in the not-to-distant future.
Regards,
USA320Pilot