Is USAirways hostile takeover Of AA for Real?

[Mr Red]

Mr. Red, I'm giving you a minus one.

This "merger" lol or grand opera we are in has so many different outcomes yet to come to fruition that the unrestricted cash seems to somehow play a smaller role especially when compared to "what do the creditors want?"

Also, we do not yet know wether or how labor strife will rear its head. What we do know is that 3 different contracts are out for vote, unless I'm mistaken. What happens if 2 or 3 of these gets voted down will determine alot. If all three are voted down, YES there will be that strife you think that hasn't appeared.

Horeton's idea to merge or futher consolidate the airlines is not that big of deal. Have you never sat around with some friends and seen a commercial and someone says "I thought of that idea!" There are a gazillion ideas floating around...it is the execution of said idea and the relevancy to the current market that wins the game...and he's having a bad time in both areas. Also, Parker has never ran around saying "I thought of it!" He took the idea and ran with it while Tom "stuck in his thumb and pulled out a plum..." <== not a good time to sit on ones hands, if you ask me.

I think most people know that the current model with the corrections he plans on making will not cut it in 2014-2020. From what I'm reading most on here seem to think everything will remain the same, just some market volitility, but not much else. The real #### has not hit the fan yet. The China bubble hasn't even burst...and then there are the problems with the banking sectors that are still coming down the pipeline. Merging with a larger carrier such as US would be the smartest move, personal opinions aside.

I think if he doesn't choose US, then there will be an eventual bidding war over US by the larger carriers...as things flatline 2014 -2022.

You need to take your chrystal GIMP ball to wall street!

 

[Hopeful]

Hmm, wasnt the USAIRWAYs mechanics and some of the other workers pensions dumped into the PBGC? Does anyone think that the USAIR plan would keep paying what was owed to ours while not paying theirs?

Excellent point. All the US merger fans just want a change of leadership but don't realize it won't be any different.
Yea, they will remain under PBGC payments, while the AA people live under frozen terms.


Nothing another trip to the BK court can't fix.

Again, I blame my foolish nearsighted union leadership for thinking we will fare better under parker.

All of a sudden the TWU is willing to believe in HIS promises?

 

[WorldTraveler]

tooth,
you seem to want to gloss over the fact that there are a number of people who simply are pointing out - and have done so for months - that AA is participating in the same BK process that US used twice in which it determined its own fate and that the laws favor the debtor in determining their own outcome over a plan devised from an outside party. That is not anyone's opinion; that is just the way the system works. Parker has been trying to overcome "system" in order to complete a merger w/o the ability of AMR to look at alternatives since it was precisely when DL did the same thing in BK that US' acquisition plan came up short.
US is making an enormous amount of progress in running a good airline operationally and financially, apart from the long-term strategic considerations that many of us recognize US will have to face eventually - and which they hope a merger will avoid facing.

Still, AA is doing everything to indicate it will emerge as a standalone company or choose a merger partner on its own terms.

BTW, here is a report indicating that at least some AMR creditors believe the terms US has floated in terms of ownership do not reflect AMR's expected worth relative to LCC.
http://www.reuters.com/article/2012/07/30/amr-usair-merger-idUSL2E8IHE2120120730?feedType=RSS&feedName=marketsNews&rpc=43

 

[700UW]

http://www.star-telegram.com/2012/07/28/4134144/american-airlines-panic-attack.html

 

[diamondcutter]

"The document was created &ldquo;to govern a fair and objective process of comparing all strategic alternatives&rdquo; to American&rsquo;s own plan to emerge from bankruptcy on a stand-alone basis, according to the memo"


700:

this comment is very important and basically says it all...giving the creditor's the benefit that AA is considering all alternatives. Nonetheless, they are continuing on their own path to emerge from BK as a stand alone carrier. The exculsivity extension granted by the Judge really speaks volumes that AA has all intentions of implementing their restructuring plan and emerging from BK solo.. and the judge is giving them that opportunity.
Keep in mind, that unlike other bankruptcies that have occured, AA funded their own bankruptcy. The reality is that US Airways needs AA more than the other way around.... and this is so blatantly obvious. Douggie tried to capture DL in 2006 while DL was in BK, too.

This is standard MO for Douggie to keep trying to marry a legacy, and AA is the last one.

Everyone gets you'r contempt for US . You know damn well this meger is best for the employees you use to represent . It's been said over and over again it's time for you to let go of the past. Unions are on board with this, the very ones you represented. I think you would be better off emotionally writing a book about your years at US. Do you not want us best for US and AA ? You do know that consolidation is the only way to right this industry! Have some compassion for the people you left behind. We live it everyday !

 

[johnny kat]

diamondcutter :

Everyone gets you'r contempt for US . You know damn well this meger is best for the employees you use to represent . It's been said over and over again it's time for you to let go of the past. Unions are on board with this, the very ones you represented. I think you would be better off emotionally writing a book about your years at US. Do you not want us best for US and AA ? You do know that consolidation is the only way to right this industry! Have some compassion for the people you left behind. We live it everyday !
__________________________________________________________________________________________________________

Exactly, why is she constantly trying to undo what is the best alternative for us who have to live with the cold hard nightmare she helped put in place. The only way things are ever going to get better is to move on and let the past be the past. I don't know how this person can sleep at night. And I will have to say if AFA cannot do better in the future then they must go. Lead, follow, or get out of the way.

 

[PITbull]

Everyone gets you'r contempt for US . You know damn well this meger is best for the employees you use to represent . It's been said over and over again it's time for you to let go of the past. Unions are on board with this, the very ones you represented. I think you would be better off emotionally writing a book about your years at US. Do you not want us best for US and AA ? You do know that consolidation is the only way to right this industry! Have some compassion for the people you left behind. We live it everyday !

Oh STOP with the bleeding heart , blah, blah, blah!!!! Your telling me what you think is best for the AA and U employees....PLEASE.


The Labor groups at U are NOT on board with this.....THEY DO NOT WANT THIS MERGER WITH AA UNLESS THEY GET A CONTRACT FIRST!!!!!!!!!! Can't you just tell the truth, for cry'in out loud already!

You are so full of yourself that you don't even know what your own labor groups need. You want them on BOARD?????....give them their contract FIRST. That's what I would be doing if I were on the property. I hear from Labor every single day!!!!!

I won't ever let go of the past....because those who forget the past, end up repeating it again, and again. AA employees need to educate themselves on who you are an what kind of management they are dealing with!!!

Perhaps they already know and are USING ALL OF YOU!!!!!!!

Consolidation IS NOT THE ANSWER FOR AA.
A marriage maybe best for the senior managment folks at U, and that's because you guys could never get a business plan together other than BANKRUPTCY...twice! Cost savings obtained only on the employees back!!!!!

Have the decency to allow AA to go through this process without interference. You know damn well that U will never fund a frozen pension. AA Labor needs to pose this question to U S Airways, point blank...no beating around the merry bush!!!

 

[PITbull]

News
Flying too close to the ground

Roy Kienitz
683 words
27 July 2012
Chicago Tribune
TRIB
Chicagoland Final
29
English
Copyright 2012, Chicago Tribune. All Rights Reserved.

There's a joke people tell in aviation circles: How do you make a small fortune in the airline business? Start with a large fortune! Today's case in point is American Airlines, which filed for bankruptcy in November.

American's plight is not unique -- all the major carriers have gone through bankruptcy at some point. And no wonder: If you added up all the profits and losses from every U.S. airline for the last 100 years the industry has not made a cent.

Of course in today's world, bankruptcy rarely means actually going out of business. I hope American stays around, if only because of the catastrophic effect a shutdown would have on its nearly 70,000 workers. But if it survives it should not do so in a form that either stifles competition or perpetuates the cycle of bankruptcies. Unfortunately, both of these outcomes are possible.

One result of the industry's bleak finances has been mergers. Delta merged with Northwest and United with Continental; even the scrappy Southwest put aside its go-it-alone tradition and bought its low-fare competitor AirTran.

The result today is an industry dominated by five major domestic carriers. United, Delta and Southwest each has more than 15 percent market share. American is fourth, with around 12 percent and US Airways is fifth with around 10 percent. Four of these five are profitable -- all but American. It lost $2 billion in 2011 and $1.7 billion in the first quarter of 2012.

So, can American survive?

American's management hopes to bring the company out of bankruptcy as a profitable, stand-alone entity. As tempting as this may sound, most experts do not think this is possible. American has no realistic plan to be profitable in a stand-alone form.

Its management argues that its high labor and pension costs are the problem, but this is less than half the story. American's core problem is its crippling lack of revenue. In their bankruptcy court filing just last week, American revealed it has lost $10 billion since 2001. Its strategy -- dominate five hub cities while neglecting dozens of others -- simply does not capture profitable traffic.

For example, three of its biggest footprints are in New York, Los Angeles and Miami -- good markets by themselves but not well located to serve connecting traffic. They're just not on the way to other places. The result is itineraries that are inconvenient, time-consuming and expensive. Even if it reduces employee wages and fires thousands of people, this fundamental network flaw means American still cannot grow its revenue base over the long term. This path will inevitably lead back to bankruptcy.

There is another option. American could fix its revenue problem by joining forces with one of the medium-sized airlines, one whose network is complimentary rather than overlapping. The obvious candidate is US Airways. US Airways' CEO, Doug Parker, has been clear that he thinks it would be a good move for both companies. The combined airline would be large enough to compete with the Big Three -- United, Delta and Southwest -- but not so big that it would dominate the market or raise antitrust concerns. The Big Three would become the Big Four, and when it comes to competition, four is better than three.

Whatever happens, aviation needs to grow up as an industry. That means managing its affairs according to the unforgiving laws of the market rather than the romance of the skies.

Warren Buffett said it best: "The worst sort of business is one that grows rapidly, requires significant capital to engender the growth, and then earns little or no money."

This has been the history of the airline industry, but it doesn't have to be the future.

----------

Roy Kienitz is an adviser to US Airways and was undersecretary for policy at the U.S. Department of Transportation from 2009 to 2011.

http://www.chicagotr...0,7185975.story



Here's another knucklehead touting for an AA/US merger. He was working for the DOT back in my day, and did the investigation for the US Airways meltdown during the xmas holiday, when management tried to blame (yes I mean point blank blame) the employee call offs during the holiday for the misconnected bags, cancelled flights, etc... The results came back after the investigation, and proved that the airline was blamed for not calling back furloughees from the VF list (because they were trying to save more money and working their employees to death) due to months and months and months of high attrition that never got bodies on the property to replace, after many e-mails went out to managment BEFORE the holdays telling them we DON'T HAVE NOUGH EMPLOYEES TO OPERATE the schedule...helloooooooooo!!!!

This idiot who commented in this article now works as an advisor to US Airways for the merger no less!!! Well, I'll be damned.

He states that having 4 legacies is better than only having 3 for competition purposes. He is insinuating that without consolidation between AA/US, that they both won't exist...HUH???????

 

[wings396]

diamondcutter :

Everyone gets you'r contempt for US . You know damn well this meger is best for the employees you use to represent . It's been said over and over again it's time for you to let go of the past. Unions are on board with this, the very ones you represented. I think you would be better off emotionally writing a book about your years at US. Do you not want us best for US and AA ? You do know that consolidation is the only way to right this industry! Have some compassion for the people you left behind. We live it everyday !
__________________________________________________________________________________________________________

Exactly, why is she constantly trying to undo what is the best alternative for us who have to live with the cold hard nightmare she helped put in place. The only way things are ever going to get better is to move on and let the past be the past. I don't know how this person can sleep at night. And I will have to say if AFA cannot do better in the future then they must go. Lead, follow, or get out of the way.

I think that its about time that we get to the bottom of her agenda. Yes, I know who she is and WAS. No longer with US, but still active with the AFA. If this merger takes place, the AFA is most likely toast with the combination of AA & US, and her bread and butter will take a major hit period. I can't help but to laugh at how she copy & pastes all of her posts on both airlines threads. Nothing more than a campaign to save some AFA dues income, and perhaps her own as well. If you don't agree with her, you are promptly accused of being management....

 

[PITbull]

You know, I love how you two just have it in for Parker as though he were the first slippery business man you ever heard about. You know WT you go on and on about the value of this and the meaning of that, but in the end I don't think you've ever had to cut a deal or known anyone or been in a family where they do run a large company and see what really happens to get something done. Theorhetical knowledge I say!

Pitbull, you're just as bad. You have this long standing grudge or who knows what tired vengance from days of yore, but it is so old and sloppy and irrelevant at this point. Just get over it already,OK?

Others: And to those of you who have your identities tied up as an AA'er or US'er you've got to get over this. I wrote several years ago on the other board about airline consolidation globally. The rug is being pulled out from under you no matter who you work for...and that's any company, not just airlines. This airline restructuring is a microcosm of what is happening in all areas globally. I shall remind everyone that you can expect the same process to happen to your religions as well.

Hey toothy... when you looked into your crystall ball, and since you were writing about everyone's future, did you see that GOVERNMENT REGUALTION WILL BE COMING AROUND THE CORNER FOR THIS LOVELY INDUSTRY OF CONSOLIDATORS???????

How do you think the flying public will fair when the industry has reduced the capacity and increased the fares to infinity?????? Do you think that the smaller carriers will not get gobbled up too??? Do you think they will be able to stay in business and compete with these huge, consolidated few legacies??????

As I HAVE TOO WRITTEN....these smaller carriers offering service in the future is like having lemonaide stands, trying to sell a beverage in front of the COCA COLA CORPORATION!!!!!!!

 

[700UW]

She isnt active within the AFA, she is retired from US and the AFA.

 

[Bob Owens]

He states that having 4 legacies is better than only having 3 for competition purposes. He is insinuating that without consolidation between AA/US, that they both won't exist...HUH???????

Oh how they love their threats. Well after 33 years I've survived 6 airlines that didnt, I'm betting I could outlive another.

 

[PITbull]

I think that its about time that we get to the bottom of her agenda. Yes, I know who she is and WAS. No longer with US, but still active with the AFA. If this merger takes place, the AFA is most likely toast with the combination of AA & US, and her bread and butter will take a major hit period. I can't help but to laugh at how she copy & pastes all of her posts on both airlines threads. Nothing more than a campaign to save some AFA dues income, and perhaps her own as well. If you don't agree with her, you are promptly accused of being management....

Well, I must be pretty damn important to ya...huh??? You keep following me around!

I must have some pretty important things to say now don't I? Hitting a nerve of yours, are we?????

Go pound salt off a cliff in a hurricane, pal!!!!!!!!

 

[Bob Owens]

Everyone gets you'r contempt for US . You know damn well this meger is best for the employees you use to represent . It's been said over and over again it's time for you to let go of the past. Unions are on board with this, the very ones you represented. I think you would be better off emotionally writing a book about your years at US. Do you not want us best for US and AA ? You do know that consolidation is the only way to right this industry! Have some compassion for the people you left behind. We live it everyday !

How is it better for us?

Synergies=job cuts.

While some Union Leaders jumped on board I dont think many asked their members how they felt. I'm not in favor of it, If USAIR is crapping all over the workers they currently have why should I think they will be any better with us?

 

[diamondcutter]

I'm full of myself wow hello kettle. Im in the know a lot more than you think I am. I'm still here!! Again throwing your former co workers under the bus. What is your opinion on that? Again tell us why you left. How do know AA's plan did Horton give you a hoo. Give the US employees a break or better yet wish us go under! You'r arm must hurt from constantly patting yourself on the back Norma Rea. Contact first save it you and I know it will be the sam TA reworked if that. US does not need a TA for this merger so save it. Will you be happy if we are out of jobs? Can you answer that? Can you explain how consolidation is not good. I'm far more in the thick of it than you so don't assume. To say if " if I were on the property" save it you had your chance .

Oh STOP with the bleeding heart , blah, blah, blah!!!! Your telling me what you think is best for the AA and U employees....PLEASE.


The Labor groups at U are NOT on board with this.....THEY DO NOT WANT THIS MERGER WITH AA UNLESS THEY GET A CONTRACT FIRST!!!!!!!!!! Can't you just tell the truth, for cry'in out loud already!

You are so full of yourself that you don't even know what your own labor groups need. You want them on BOARD?????....give them their contract FIRST. That's what I would be doing if I were on the property. I hear from Labor every single day!!!!!

I won't ever let go of the past....because those who forget the past, end up repeating it again, and again. AA employees need to educate themselves on who you are an what kind of management they are dealing with!!!

Perhaps they already know and are USING ALL OF YOU!!!!!!!

Consolidation IS NOT THE ANSWER FOR AA.
A marriage maybe best for the senior managment folks at U, and that's because you guys could never get a business plan together other than BANKRUPTCY...twice! Cost savings obtained only on the employees back!!!!!

Have the decency to allow AA to go through this process without interference. You know damn well that U will never fund a frozen pension. AA Labor needs to pose this question to U S Airways, point blank...no beating around the merry bush!!!

Oh STOP with the bleeding heart , blah, blah, blah!!!! Your telling me what you think is best for the AA and U employees....PLEASE.


The Labor groups at U are NOT on board with this.....THEY DO NOT WANT THIS MERGER WITH AA UNLESS THEY GET A CONTRACT FIRST!!!!!!!!!! Can't you just tell the truth, for cry'in out loud already!

You are so full of yourself that you don't even know what your own labor groups need. You want them on BOARD?????....give them their contract FIRST. That's what I would be doing if I were on the property. I hear from Labor every single day!!!!!

I won't ever let go of the past....because those who forget the past, end up repeating it again, and again. AA employees need to educate themselves on who you are an what kind of management they are dealing with!!!

Perhaps they already know and are USING ALL OF YOU!!!!!!!

Consolidation IS NOT THE ANSWER FOR AA.
A marriage maybe best for the senior managment folks at U, and that's because you guys could never get a business plan together other than BANKRUPTCY...twice! Cost savings obtained only on the employees back!!!!!

Have the decency to allow AA to go through this process without interference. You know damn well that U will never fund a frozen pension. AA Labor needs to pose this question to U S Airways, point blank...no beating around the merry bush!!!