Like gaucho99 said, AA benefits from buying US by cherry picking her assets and throwing the rest away. AA and US have a lot of overlap in the Caribbean. AA would gain pricing power in that market. They could probably find a use for either CLT or PHL.
Merger talks could resune in 2009
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Like gaucho99 said, AA benefits from buying US by cherry picking her assets and throwing the rest away. AA and US have a lot of overlap in the Caribbean. AA would gain pricing power in that market. They could probably find a use for either CLT or PHL.
Why would AA spend $848 million (US's current market cap) to purchase US's stock, assume all it's debts (billions), assume all it's leases (billions) on incompatible aircraft that it doesn't need only to turn around and send them to the desert, incur billions of employee integration costs in terms of training and uniforming the US people and giving them HUGE raises by bringing them up to AA pay and benefits only to turn around and lay them off and give them max severance pay to say nothing of the costs of the inevitable lawsuits, grievances, and employee morale from the inevitable fight between AA and US employees; for a small amount of "cherries"? When all AA has to do is either 1.) Wait for US to die and pick up what it wants (shuttle, LGA and DCA slots and gates only, no planes or people) for fire sale prices, or 2.)Wait for when US is desperate for cash and pay a little more and get the same assets without people or planes. AA has plenty of it's own aircraft sitting in the desert already configured in conformity with the AA operating certificate and furloughed employees already trained on the same operating certificate that it can use to operate the shuttle, DCA and LGA slots.
AA didn't even purchase TWA stock; but AA paid $742 million and assumed billions of dollars of TWA liabilities and expenses (aircraft, facilities, TWA retirees medical, HUGE increases in pay for TWA people, training and uniforms,conversion of aircraft to AA certificate) for assets that, which 90% turned out to be worthless, were promptly disposed of. Also, the lawsuits and grievances filed by the TWA people were costly in terms of time, resources, and morale. This was a very costly and painful mistake on AA's part; I think it is safe to say that they learned their lesson and won't do it again.
Most of VP's and higher within US have come from AA. Do the math. Isom, Parker, Kirby, Soto, Ciminelli. They may have worked for AWA or NW also but they all did their stint at AA.
My bet is on AA. You think we have union issues now? Whoaaa will our future be even brighter!!
My bet is on AA. You think we have union issues now? Whoaaa will our future be even brighter!!
whatkindoffreshhell
Veteran
Did you even read aafsc's previous (and the simple hard truth!) post??
Besides, AA doesn't need to care about the east coast. They have JFK & MIA going international. US has PHL and CLT going nowhere except EBF (eastbum---- if you don't have an OAG to look it up...)
CO will just tend to their business until Aretha Franklin puts on a show for UA.
DL/NW will be scrambling to integrate equipment & work cultures for years.
US will only survive until the feds decline to participate in Parker's shell game.
Good luck!
Elevation
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You got the simple part right. AA does not live in a vacuum. AA can't just wait around for the demise of US and get everything cheap, SWA's money will be in the back of every CEO's mind if a bidding war breaks out for desirable parts of US. The last thing AA wants is to lose the east coast shuttle, or whatever it see's as valuable, to a competitor and it fall further and further behind in market share.
AA would rather let themselves be outbid and end up with nothing than go through the very expensive nightmare of merging with US; it would be TWA all over again. AA has proven that they are VERY BIG on fleet and engine commonality, and US has a totally different fleet (airbuses). Also, AA would not be interested in ANY fleet where the interiors are held together by duct tape.
If AA really wanted something on or near the middle of the eastern seaboard, they could either reopen RDU or buy Airtran. Buying Airtran would be better than buying US. Airtan has new 737s like AA and the 717s are fairly new and would give AA the hundred seater it needs. Integration, even though still difficult, would be much easier because the 717 pay rates have already been negotiated with the APA; this would not be the case with US's airbuses; Hill and crew would never agree to anything in order to stick it to AA. Pilot integration would be easier because no Airtran pilot had any premerger expectations of flying a widebody; whereas US pilots would demand DOH and claim all 777 and 787 flying. And finally ATL is more like ORD where CLT is more like STL or CVG.
wings396
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Reopen RDU??? It failed big-time before, so what would make you think that they would want to just give it another try? Buying Airtran and Hubbing together with DL in ATL isn't the best plan either. While CLT isn't ATL or ORD, it isn't the likes of STL or CVG either. I would put CLT somewhere in the middle due to it's steady area growth.
jimntx
Veteran
If so, why is it that every flight I work to/from the East Coast stations is packed? Has it occurred to you that we have all the East Coast business we can stand? I am well aware of the LCC belief that we covet the shuttle, but I've never heard anyone here at AA even mention it, much less show any interest in operating it.
As was said by someone else in this thread, we have certificated a/c in the desert and employees on furlough if we were in an expansion mood. Truth is that there may be additional furloughs and more a/c going to the desert in 2009.
For the record, no one here at US Airways wants anything to do with AA, so I hope you're right. AA has some of the worst ground personal, because of the sub contracting they do. And it's no wonder because those employees work for poverty level wages. So don't think for a minute we believe a us/aa hook will do anything but suck.
AA has no interest in US or their Shuttle. The value of the Shuttle has diminished considerably since the successful advent of Acela, and, quite frankly, the revenue potential of the Shuttle is no longer what it was when AA was first interested in it back in the early 90's.
Witness DL's outsourcing of the LGA-DCA shuttle market to Shuttle America. Once one of the crown jewels, revenue potential-wise, of the DL purchase of Pan Am's assets and authorities, the Shuttle is no longer a money-making proposition for DL. The DL LGA-BOS shuttle is next to be outsourced.
The only talk I ever hear of AA's interest in US and the shuttle comes from US employees who, on one hand, like the poster above, malign AA but, on the other hand, in private, secretly yearn for somebody to come along and buy their dying carrier. While they would probably like to be bought by anybody BUT AA due to AA's historical treatment of acquired carriers and employees, at this point, it appears that US is so terminal that the employees yearn to be bought by ANYBODY.
Wishful thinking on the part of US employees, whether they like to admit it or not, because an AA deal, for good or bad, represents their only chance for continued longevity.
If any deal were to be done, Shuttle or otherwise, however, it will not include employees, IMHO.
Witness DL's outsourcing of the LGA-DCA shuttle market to Shuttle America. Once one of the crown jewels, revenue potential-wise, of the DL purchase of Pan Am's assets and authorities, the Shuttle is no longer a money-making proposition for DL. The DL LGA-BOS shuttle is next to be outsourced.
The only talk I ever hear of AA's interest in US and the shuttle comes from US employees who, on one hand, like the poster above, malign AA but, on the other hand, in private, secretly yearn for somebody to come along and buy their dying carrier. While they would probably like to be bought by anybody BUT AA due to AA's historical treatment of acquired carriers and employees, at this point, it appears that US is so terminal that the employees yearn to be bought by ANYBODY.
Wishful thinking on the part of US employees, whether they like to admit it or not, because an AA deal, for good or bad, represents their only chance for continued longevity.
If any deal were to be done, Shuttle or otherwise, however, it will not include employees, IMHO.
wings396
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Slow down there a bit pal, I for one don't want ANYTHING to do with AA. Your Airline would be the last on my list of preferred partners due in part to AA's track record with past mergers etc. I still recall when AA started service to my former station, and told their employees not to speak with employees of the other carriers. A few of their newly hired employees at my station were former employees of another carrier, and were shocked that this was actually express to them. The Manager and Supervisors were arrogant as hell, and even told a few of us that our days were numbered now that that Almighty AA was in town. Needless to say, AA ended up leaving after a few years, and we got tons of pleasure reminding those same idiots of their wise words to us a few years back. Not the friendliest group of airline people that I have dealt with in all my years. If that it a small sample of AA's culture, you can keep it. :down:
USwestGUY
Member
Girls, girls... Easy. Honestly, probably nobody wants either airline. Settled. 😛
