US/UA merger?

[UAL777flyer]

So the bankruptcy laws should be re-written in order to make US and maybe UA the sacrificial lambs to get the over-capacity out of the system? I agree that there is too much capacity in the system. But I don't necessarily agree that deliberately putting other carriers out of business is the answer. If they're failing, they're allowed to re-organize. If they still can't make it, then liquidate them. But please don't tell me that the bankruptcy laws should be re-written today in order to fix what's wrong with the industry.

The over-capacity problem can be blamed on every carrier. They continually talk out of both sides of their mouth. On one side, they say there's too much capacity. Then, on the other, they scramble to add flights in certain markets to steal market share. It's hypocritical. And ALL major US airlines are guilty of it. So why should US Airways be made the scapegoat for the bad business decisions of other airlines?

And your statement about a US (and possible UA) bankruptcy hurting other carriers is interesting. While I agree somewhat, I don't see how you can put CO into that statement when you consider they've been bankrupt twice and did some things during their bankruptcies that hurt other carriers. Kind of like the pot calling the kettle black.

And no, I wouldn't have second thoughts if it were DL in bankruptcy. I support US Airways ability to be able to re-organize in bankruptcy. Every business is afforded that opportunity should they need it. Why should it be different for airlines?

And please spare me about a UA bankruptcy filing driving other carriers into the same boat. While that may indeed be the straw that breaks their back and forces them to do that, the reasons for each carrier having to do so have been in the making for quite some time. Everyone wants to blame UA's pilot contract for the rising labor costs in the industry. But they forget that it was Delta that set the bar when they negotiated their B777 pilot rates. That became the benchmark that put the framework in for the UA pilot contract. If you want to find someone/something to blame the current predicament of airlines on, blame it on the combination of the low-cost carriers increasing domestic US marketshare, the fallout from a recessionary economy and the inability of the major airlines to adapt and modify the insane pricing structure. You can't blame all that on US Airways and United.

 

[KCFlyer]

[BLOCKQUOTE]
[P][BR][BR]-----------[BR][BR]If you want to find someone/something to blame the current predicament of airlines on, blame it on the combination of the low-cost carriers increasing domestic US marketshare, the fallout from a recessionary economy and the inability of the major airlines to adapt and modify the insane pricing structure. You can't blame all that on US Airways and United. [/P]
[P] ----------[BR][BR]Did nobody foresee the potential for a recession in a cyclical industry? The only thing I can see that might show that there was an inkling of some concern were the no furlough clauses in contracts. [BR][BR]Did nobody feel the heat from the increased comptetion brought about by the low cost carriers? I mean, they've only been around since before deregulation. [BR][BR]What was different in the industry back in 1992, when Crandall at AA tried to modify the insane pricing structure with value pricing? [BR][BR]I remember one Southwest annual report that began with the words In 19xx, We didn't merge. Maybe the 2002 version will hold the line In 2002, we didn't file bankruptcy. [/P][/BLOCKQUOTE]

 

[chipmunn]

UAL777flyer:

Your last two posts in this thread were especially good and I agree with your thoughts. I believe not only are some of the post sour grapes, but appear to be made by people concerned about the competitive effect of UA & US. With the two company's beginning the process to integrate their route networks I found Blaylock & Partners airline analyst Ray Neidl's comments to the Houston Chronicle to be interesting.

Niedl said, while Continental and Northwest fit together nicely, Delta and Continental directly compete in some regions.

The Chronicle continued, for example, they both have large operations in New York, and they both have hubs in Ohio, he said. In Texas, there could also be a problem because Continental has a hub in Houston, and Delta has a hub in Dallas.

If it is approved, it will have a lot of disclaimers to it, Neidl said.

The alliance between United and US Airways, which filed for bankruptcy protection this summer, was characterized as necessary by some analysts, particularly since US Airways doesn't belong to any kind of worldwide partnering system like the other major airlines do.

The partnership also is important to United, because it allows the airline to cover an area of the country not covered previously, the Chronicle wrote.

Chip

 

[UAL777flyer]

What's different now compared to 1992 in terms of low-cost carriers? They represent about 23% domestic US marketshare now as compared to the low single digits 10 years ago. I'd say they've made big strides. The other majors have failed to effectively compete. Now that those low-cost carriers are reaching or have reached critical mass, the problem has dramatically compounded. I don't see how US Airways and United can be blamed for the problems that exist at each U.S. major?

You want to blame them for lousy management over the years? Go right ahead, I'm right there with you. But the law allows failing businesses the right to re-organize. Your complaint about that shouldn't be addressed towards the airlines when they're doing nothing wrong.

 

[Oliver Stone''s Apprentice]

[blockquote]
----------------
On 10/4/2002 5:34:47 PM UAL777flyer wrote:

What's different now compared to 1992 in terms of low-cost carriers? They represent about 23% domestic US marketshare now as compared to the low single digits 10 years ago.

----------------
[/blockquote]

What was also different in 1991/1992 was that there were three large failing airlines plus a few smaller ones who were operating in Chapter 11.

Arguably, the difference in overall marketshare that LCC's make up today vs. ten years ago can be seen in part as a shifting of marketshare which was held by Eastern, Pan Am, and TWA.

BTW, thanks for the corrections on my mixup between the ALPA and IAM reps re: the 2000 US/UA transaction. The late hour must have been clouding my memory...

 

[KCFlyer]

[BR][BR][BR]
[BLOCKQUOTE][BR]----------------[BR]On 10/4/2002 5:34:47 PM UAL777flyer wrote:[BR][BR]What's different now compared to 1992 in terms of low-cost carriers? They represent about 23% domestic US marketshare now as compared to the low single digits 10 years ago. I'd say they've made big strides. The other majors have failed to effectively compete. Now that those low-cost carriers are reaching or have reached critical mass, the problem has dramatically compounded. I don't see how US Airways and United can be blamed for the problems that exist at each U.S. major?[BR][BR]You want to blame them for lousy management over the years? Go right ahead, I'm right there with you. But the law allows failing businesses the right to re-organize. Your complaint about that shouldn't be addressed towards the airlines when they're doing nothing wrong.----------------[/BLOCKQUOTE][BR][BR]Bobby Crandall certainly was a visionary. But he proposed killing the sacred cow of price gouging, seeing the inroads that the low cost carriers were making. Imagine how much better poised all airlines would be today had they only seen what he saw. [BR][BR]But his plan didn't go over well with either managment or labor. After all, he was the ogre who implemented B Scales and any attempt to kill the high fares that justified the industry leading demands were looked upon as just another way to screw labor. MAnagement at other airlines were too afraid of giving up ground to the low cost carriers that they spent the bulk of thier time and effort to trying to portray themselves as the low price leaders by flying seats at a loss and making up for them with outrageous business fares. When business took a downturn, they shopped price. Had they been allowed to shop price for the past 10 years with competitive fares that didin't have to undercut the low fare guys, but were pretty darn close to matching their business fares, most of these failing airlines wouldn't be hurting near as much. And the fact that all the other airlines are hurting, but not enough to go to bankruptcy, and still eeking by with hopes of holding out until the times get better will only be punished by the airlines who, for whatever reasons, weren't as well prepared. Had AA not bought out TWA, they would most likely be in a position to put a real hurting on the industry, rather than waiting in the wings for their turn to head into bankruptcy court. Why not just let EVERY airline file bankruptcy and start them all over from a clean sheet. IMHO, that's what's going to happen anyway.

 

[REACC1]

[BR][BR]
[BLOCKQUOTE][BR]----------------[BR]On 10/4/2002 7:18:27 PM KCFlyer wrote:[BR][BR][BR]----------------[BR]KC wrote-{ Had AA not bought out TWA, they would most likely be in  a position to put a real hurting on the industry, rather than waiting in the wings for their turn to head into bankruptcy court. [BR][BR]IMHO, TWA would have went bye bye, thus resulting in some reduced capacity. It probably would have eased some of the burden.[BR][BR]KC wrote- Why not just let EVERY airline file bankruptcy and start them all over from a clean sheet.  IMHO, that's what's going to happen anyway.[BR][BR]Read...any low cost start up,( you know, the ones that are biting every mature air carrier in the butt) with out the usual start up related costs. How else does one climb out of the shark infested waters? Hide behind a rock until you can find a way out of there. [BR][BR]----------------[/BLOCKQUOTE][BR][BR]

 

[767jetz]

Chip,

First of all, my comment was not condescending, nor was it an insult, nor was I shooting the messenger. I really do think your obsession with a UA/US merger is nausiating. Of course that's just My Humble Opinion. Isn't freedom a great thing? Now take a deep breath and try not to get so excited when someone has a differing point of view from your own.

Secondly, you did not respond to whether US is giving ALPA any seats on the board or not. If so, how is this better than UA's labor being in the board room?

Thirdly, you most certainly have implied that you can not comment on confidential material, which leads us to believe that at the very least you have an inside source.

Finally, as for pilot senority, a prenuptual is an effort by a aquiring airline owned by employees, to protect their investment and seniority from the (at the time) weaker, smaller aquired airline. You see, we did not see it as a merger. It was an aquisition (attempt). Regardless, the prenup never came into play. You did fail to comment however, on the U position of date of hire, which WOULD have bypassed ALPA merger policy. Talk about the pot calling the kettle black!

PS. When you say things like special interest actions and using merger support to extract breathtaking pay increases many of us find that insulting and condescending. It also demonstrates your lack of understanding of United Airlines and our culture. So please don't dish it out if you can't take it.

disclaimer: the views expressed in this post are my opinion, and may or may not represent the views of every other UA pilot, past, present and future.

 

[Pacemaker]

767jetz, the US Airways pilots' position on merger integration was not Date of Hire, it was to proceed via ALPA merger policy, the union we both pay dues to and have a right to expect due representation from, and then abide by whatever result that process yielded. If you really (urban legend)ran across pilots who claimed a right to your 777 seats then they were truly in the minority (names, dates, places?). Probably the same few loose cannon-types that you had at United who were running around with staplers.

 

[767jetz]

[blockquote]
----------------
On 10/5/2002 1240 PM Pacemaker wrote:

767jetz, the US Airways pilots' position on merger integration was not "Date of Hire", it was to proceed via ALPA merger policy, the union we both pay dues to and have a right to expect due representation from, and then abide by whatever result that process yielded. If you really (urban legend)ran across pilots who claimed a right to your 777 seats then they were truly in the minority (names, dates, places?). Probably the same few loose cannon-types that you had at United who were running around with staplers.
----------------
[/blockquote]
Sorry, but no urban legend here. This is first hand info! Never got their names. I honestly didn't care to know them. Just tuned them out until I got to my destination.

Dates... again it was long ago. I guess I could go back to my schedule from 2000 and figure out what dates I commuted, but it's just not worth it.

Place... RIC to LGA. I used to commute from there. For some reason it always seemed to happen on the trip up and not back. And it was approximately every second time, so it was often enough to give me a bad opinion. To be honest, when I first heard the rumor, I refused to believe it, and filed it away as a few bad apples. Once I started experiencing it on a regular basis I became a believer.

PS. As for your comment about paying dues and each respective group looking out for the interest of their members, I totally agree. The only reason I even brought this subject up was in response to Chip's assertion that the actions of the UAL MEC was a special interest action of pre-nuptial seniority agreements to bypass national union merger and fragmentation policy.

 

[N513AU]

[blockquote]
Ahem, he saved the airline. He filed for bankruptcy because we were bankrupt. We were on the brink of an involuntary filing by creditors, which would have put us out of business. You are just pissed off because you know concessions probably aren't so far down the road for Delta. You're upset because your precious little Mullen is scared crapless. And he's scared because he now knows he can't swoop in and pick the remains of US Airways. Dave Siegel was the first one to say "we have to take stock of what's going on here if we are going to save the airline (and the industry). The other airlines will either be learning lessons from us or parishing. And while I used to be a big fan of Delta and Mullen, he has shown himself in a sad new light... a pathetic one at that.
----------------
[/blockquote]

He might have bought the company another ten years, saving it is a bit optimistic. In a few years, US Airways will be doing well - then in about ten years from now, we will be right back where we are now. That will be after Dave and company leaves for greener pastures and takes billions from us (that we gave them). It's what always happens at US Airways.

 

[N513AU]

[blockquote]
----------------
On 10/4/2002 5:34:47 PM UAL777flyer wrote:

What's different now compared to 1992 in terms of low-cost carriers? They represent about 23% domestic US marketshare now as compared to the low single digits 10 years ago. I'd say they've made big strides. The other majors have failed to effectively compete. Now that those low-cost carriers are reaching or have reached critical mass, the problem has dramatically compounded. I don't see how US Airways and United can be blamed for the problems that exist at each U.S. major?

You want to blame them for lousy management over the years? Go right ahead, I'm right there with you. But the law allows failing businesses the right to re-organize. Your complaint about that shouldn't be addressed towards the airlines when they're doing nothing wrong.
----------------
[/blockquote]

Low cost carriers are the enemy. We MUST unionize their non-union outsourced maintenance sweatshops, as that is the biggest threat to the mechanics wages. When Southwest can pay someone (who probably doesn't know better) $15 an hour to fix an airplane, THAT MAN IS STEALING YOUR WAGES.

Yes, Dave was the mugger who stole your paycheck - but the reason is the low-wage sweatshops that airlines would love to send your work to. When we finally get those places to stop working for pocket change, hopefully some of the downward pressure on our wages should stop.

I think what is really needed is an industry-wide national strike by all airline labor. Shut the business down, boys and girls. This downward pressure on our wages need to stop and now. The public wants seats at unreasonable (and unsafe) prices and our management wants to give them airline travel at greyhound prices. Since airplanes cost more than busses, their solution is to pay us less to make up the difference.

I am sick of hearing that greedy labor is the reason for this whole mess. If that is the case, why are many auto mechanics making more than airline mechanics? Why is it that the airline wants quality customer service, but wants to pay them at McDonald's wages?

Folks, unless we stand up against the tide, we are going to keep getting screwed. We need to say, across the industry and at every company, $xxx is the wage for an airplane mechanics and so on. If you want your airplanes fixed, come up with the money.

513

Doing 9%-22% less on a daily basis. You get what you pay for.

 

[chipmunn]

[BR][FONT face=Times New Roman size=3]Hi 767jetz:[/FONT][BR][BR]
[P align=justify][FONT face=Times New Roman size=3]I believe I have said three or four times in different posts I believe employee equity ownership can be good because people take better care of something if it is their own. In addition, I believe employee board representation can be good because it can build trust between management and labor. US ALPA did receive a board seat, but the issue I believe hurts UAL is governance, which is different from US and I understand is a problem in the eyes of the ATSB.[/FONT][BR][BR]
[P align=justify][FONT face=Times New Roman size=3]Regardless of how you want to slice it, a pre-nuptial seniority agreement is designed to bypass merger policy. [/FONT][FONT face=Times New Roman size=3]Finally, unless something changes I do not believe UA & US would merge and I have never said so. Instead I believe the parties have discussed a unique corporate transaction in an attempt to prevent a UA bankruptcy filing. Will it occur? I do not know; however, in bankruptcy anything is possible.[/FONT][BR][FONT face=Times New Roman size=3][/FONT][BR]
[P align=justify][FONT face=Times New Roman size=3]Chip [/FONT][/P]

 

[767jetz]

[BR][BR]
[BLOCKQUOTE][BR]----------------[BR]On 10/5/2002 3:55:57 PM chipmunn wrote:[BR][BR][BR][BR]
[P align=justify][FONT face='Times' size=3 Roman" New]US ALPA did receive a board seat, but the issue I believe hurts UAL is governance, which is different from US and I understand is a problem in the eyes of the ATSB.[/FONT][FONT size=3][/FONT][/P][/BLOCKQUOTE][BR]
[BLOCKQUOTE][BR]
[P align=justify][BR][FONT face=Arial Black]Thankyou for clarifying.[/FONT][BR][BR][BR]
[P align=justify][FONT face='Times' size=3 Roman" New]Regardless of how you want to slice it, a pre-nuptial seniority agreement is designed to bypass merger policy. [/FONT][FONT size=3][/FONT][/P][/BLOCKQUOTE][BR]
[BLOCKQUOTE][FONT size=3][/FONT][BR]
[P align=justify][FONT face=Arial Black]So is a claim to date of hire rights.[/FONT][BR][FONT face='Times' size=3 Roman" New][/FONT][BR][/P][/BLOCKQUOTE]

 

[KCFlyer]

[P]
[BLOCKQUOTE][BR]----------------[BR]On 10/5/2002 4:42:22 PM N513AU wrote:
[P]
[BLOCKQUOTE][BR]I think what is really needed is an industry-wide national strike by all airline labor. Shut the business down, boys and girls. This downward pressure on our wages need to stop and now. The public wants seats at unreasonable (and unsafe) prices and our management wants to give them airline travel at greyhound prices. Since airplanes cost more than busses, their solution is to pay us less to make up the difference.[BR][BR]----------------[/BLOCKQUOTE][/BLOCKQUOTE]
[P]Here's your soloution - U can keep 1 767, UAL one 777. AA and Delta can each have one MD11 and Northwest can hold on to one 747. That ought to be enough to support the flying public that will be flying at what you consider reasonable prices. Sorry to inform you, but in a service market, the customer rules. Raise the fares, cut the fleets and you might be LUCKY to get a job fixing cars. Because customers will NOT be willing to pay a thousand bucks for a 200 mile flight. Sorry. BTW, what's unsafe about a low fare? [/P]