US Ups Delta Offer

[IMisstheAladdinTrays]

Oh, kinda like PIT remaining a hub?

We all know there are big differences in PIT and CLT. So lets compare apples to apples. Shall we?

Wait here's an ever better idea. Let's wait and see what happens.

WOW! that's some lofty dreamin' your doin' there....

Whatever your smokin', I'd like some......

Uhh huh...it is called speculation. You know what speculation is...like your demise of CLT theory. Yeah, so you speculate your way and I'll speculate mine!

 

[US1YFARE]

So lets compare apples to apples. Shall we?

Braeburn or fiji?

Braeburn is one of the most important commercial apple varieties. It originated in New Zealand in the 1950s, and by the last decades of the 20th century had been planted in all the major warm apple-growing regions of the world. Braeburn accounts for 40% of the entire apple production of New Zealand. Even in conservative Washington state, the most important apple-producing area of the USA, where Red Delicious and Golden Delicious have always held sway, Braeburn is now in the top 5 varieties produced.


Fuji apples are typically large or very large and round, on average the size of a baseball. They contain between 9-11% sugars by weight and have a dense flesh that is sweeter and crispier than many other apple varieties, making them popular with consumers around the world. Fuji apples also have a very long shelf life compared to other apples, even without refrigeration. With refrigeration, Fuji apples can last up to 5-6 months.

 

[PITbull]

Sixteen months out of Bk, and U ups to $10B for Delta...$5 billion in cash.

Can some exec come on this show and tell us just how U acquired $5 billion in cash being so soon out of BK????


And, just when would now be a good time to negotiate fair transition aggreements with your labor groups.

 

[US1YFARE]

Sixteen months out of Bk, and U ups to $10B for Delta...$5 billion in cash.

Can some exec come on this show and tell us just how U acquired $5 billion in cash being so soon out of BK????
And, just when would now be a good time to negotiate fair transition aggreements with your labor groups.

let's face it
they don't care about their customers, do you really think they care about the employees?

 

[Jimmy Neutron]

Wait here's an ever better idea. Let's wait and see what happens.
Uhh huh...it is called speculation. You know what speculation is...like your demise of CLT theory. Yeah, so you speculate your way and I'll speculate mine!

Ughh....It's not speculation, just plane old common sense!

 

[IMisstheAladdinTrays]

Braeburn or fiji?

Braeburn is one of the most important commercial apple varieties. It originated in New Zealand in the 1950s, and by the last decades of the 20th century had been planted in all the major warm apple-growing regions of the world. Braeburn accounts for 40% of the entire apple production of New Zealand. Even in conservative Washington state, the most important apple-producing area of the USA, where Red Delicious and Golden Delicious have always held sway, Braeburn is now in the top 5 varieties produced.
Fuji apples are typically large or very large and round, on average the size of a baseball. They contain between 9-11% sugars by weight and have a dense flesh that is sweeter and crispier than many other apple varieties, making them popular with consumers around the world. Fuji apples also have a very long shelf life compared to other apples, even without refrigeration. With refrigeration, Fuji apples can last up to 5-6 months.

Is this the best you could come up with?

 

[WorldTraveler]

Creditors can't overrule the DOJ which will undoubtedly tie DL/US up for years.... and if the creditors force DL to go with US, the rest of the industry will consolidate. If the creditors calculate wrong, then they have left DL as the smallest of the network airlines - other than US which will probably end up in BK again anyway (notice that US' load factor is the lowest in the industry these days despite pulling down capacity - the US plan is just not working the way Dougie thought it would).

NW is one of the weaker carriers from a network perspective as well. Given that UA and CO seem to prefer each other, NW faces the prospect of being acquired by AA who will probably tear them up into pieces and then spit them out (if they can get a deal past DOJ given that AA/NW have FOUR midwest hubs). DL and NW will manage to work things out since both have mgmt teams that have managed to dramatically turn their respective carriers around.

The DL creditors may be enthralled at the idea of all that cash - but it will come at the expense of the viability of US/DL in the future. Some creditors may care less about the future of US/DL or the industry but other creditors very much do..... and of course the government sure cares.

DL mgmt hasn't raised their offer because they know it would be far better for the industry, the government, and the creditors for DL to emerge independently and then merge shortly thereafter (both carriers could finalize their lease negotiations based on a pending merger).

US faces the daunting hurdle trying to push a hostile takeover in an industry where there has NEVER been a successful hostile takeover. US also faces the most intense government review an airline merger has ever faced and all the indications are that the government would strip so much from the combined airline that US/DL would be left with little more than the socks they are wearing.

US is pursuing DL purely because its own merger strategy w/ HP is failing and it desperately needs to eliminate a competitor and gain access to the top east coast markets in order to make it. It is undoubtedly true that Parker could have set off industry consolidation but US could be left alone after the rest of the industry consolidates. US will be left with small hubs compared with other carriers that are not only not geographically positioned to capture the bulk of east-west connecting traffic but also are infested by competition.

DL's creditors will make the right decision - if for no other reason because the government will "help" them decide.

 

[Redbone]

Of the three merger possiblities, Northwest is a more likely suitor than United, given anti-trust concerns. A Northwest-Delta pairing might be more likely to clear regulators and could offer a better alternative to US Airways.

In December, Delta executives put out a position paper claiming a US Airways- Delta deal will never gain regulatory approval. The paper says the two airlines have significant overlap -- 31 non-stop routes on the East Coast, accounting for $1.6 billion in annual revenue.

But a Northwest-Delta combo could be another story. Northwest’s Minneapolis and Detroit hubs complement Delta’s south and east route structure. Northwest has powerful Pacific operations with a Narita (Tokyo) operation. (weak network)snicker

Delta, meanwhile, has limited overlap with Northwest, with major hub facilities in Atlanta, New York JFK, a strong route system on the Atlantic Coast, and a well developed Latin America system, but is weak in the western U.S.


World:
"NW is one of the weaker carriers from a network perspective as well. Given that UA and CO seem to prefer each other, NW faces the prospect of being acquired by AA who will probably tear them up into pieces and then spit them out (if they can get a deal past DOJ given that AA/NW have FOUR midwest hubs)."

Weakest from who's perspective? Yours? Do you have any clue about the airline industry? You do realize that ANY airline can be bought and split up...including YOURS.

Why would AA, with over $22 billion in debt push that up to over $30 billion?

 

[ClueByFour]

Creditors can't overrule the DOJ which will undoubtedly tie DL/US up for years.... and if the creditors force DL to go with US, the rest of the industry will consolidate. If the creditors calculate wrong, then they have left DL as the smallest of the network airlines - other than US which will probably end up in BK again anyway (notice that US' load factor is the lowest in the industry these days despite pulling down capacity - the US plan is just not working the way Dougie thought it would).

No, it's not working the way he thought it would.

Here is the thing: on vastly reduced capacity, and increased fares, LCC has made a few quarters of money. What nobody who is pro-merger or who thinks Parker is a genius will admit is that the lion's share of said profits come from what was US-East. Those profits came about because the bankruptcy court allowed the US-East management to slaughter employee wages/benefits/pensions and screw creditors, not as a result of any management acumen on Tempe's part. But herein lies the problem: what to do when one cannot reduce capacity anymore?

Parker's answer is to buy Delta, use the bankruptcy court to further abuse creditors and leaseholders and employees, and continue to reduce capacity.

But in a year or two, even that move will begin to fade, and then they will have to start running the airline. Here is where is gets tricky. If you look at any of the big stuff, US/HP are basically still two airlines and the stuff they have tried to combine (website, notably) has been a complete and utter charlie fox.

By upping the offer, Doogie is basically mortgaging the assets that will be acquired to the hilt, which means an outrageous debt load. What remains unsaid is that many of the creditors who are going to get some of the pie may very well be the one's whose assets are being mortgaged. And, given the fact that an antitrust review will take a year, plus whatever time is spent in bankruptcy, it means that the creditors won't see their cash for awhile. More importantly, it means they won't see their stock for awhile--the latter is important, because if Doogie's crew can't get it together operationally, the stock is in trouble in the long term.

This is all about a quick financial hit, and has very little to do with creating a viable airline moving forward. DL/NW and DL/UA make much more sense that US/DL. UA/US makes sense. UA/DL makes somewhat less sense. DL/NW makes sense from a network standpoint and little else. DL/US only makes sense if the intention is to yank down capacity and completely gouge the east coast (which is why Doogie has such a hard-on for DL). It's not about running the airline 5 years from now. They've had two years, and have done operationally squat to integrate the two existing airlines. Paint looks good, though.

 

[etops1]

No, it's not working the way he thought it would.

Here is the thing: on vastly reduced capacity, and increased fares, LCC has made a few quarters of money. What nobody who is pro-merger or who thinks Parker is a genius will admit is that the lion's share of said profits come from what was US-East. Those profits came about because the bankruptcy court allowed the US-East management to slaughter employee wages/benefits/pensions and screw creditors, not as a result of any management acumen on Tempe's part. But herein lies the problem: what to do when one cannot reduce capacity anymore?

Parker's answer is to buy Delta, use the bankruptcy court to further abuse creditors and leaseholders and employees, and continue to reduce capacity.

But in a year or two, even that move will begin to fade, and then they will have to start running the airline. Here is where is gets tricky. If you look at any of the big stuff, US/HP are basically still two airlines and the stuff they have tried to combine (website, notably) has been a complete and utter charlie fox.

By upping the offer, Doogie is basically mortgaging the assets that will be acquired to the hilt, which means an outrageous debt load. What remains unsaid is that many of the creditors who are going to get some of the pie may very well be the one's whose assets are being mortgaged. And, given the fact that an antitrust review will take a year, plus whatever time is spent in bankruptcy, it means that the creditors won't see their cash for awhile. More importantly, it means they won't see their stock for awhile--the latter is important, because if Doogie's crew can't get it together operationally, the stock is in trouble in the long term.

This is all about a quick financial hit, and has very little to do with creating a viable airline moving forward. DL/NW and DL/UA make much more sense that US/DL. UA/US makes sense. UA/DL makes somewhat less sense. DL/NW makes sense from a network standpoint and little else. DL/US only makes sense if the intention is to yank down capacity and completely gouge the east coast (which is why Doogie has such a hard-on for DL). It's not about running the airline 5 years from now. They've had two years, and have done operationally squat to integrate the two existing airlines. Paint looks good, though.

you guys really talk alot of s#it. it makes me laugh .

 

[Rico]

Seems like people are still missing the point.


DAL/NWA only adds markets to the merged carrier, not market domination.

That means that Delta 2.0 would then be flying to (some) new places, but face already established competition. (Remember too, you can already fly as a Delta passenger (code share) pretty much everywhere a merged DAL/NWA would offer anyways). (No real gain)



or...

A US/DAL merger would instead add fewer new markets, but
would give market domination in many of the established ones, and you would face less competition.

Less competition means more pricing power, which means better profits. (You gain)


So...

Then the same old "what about the DOJ" arguement comes out yet again...

It comes down to the fact that the Government has been quite content to allow uncompetitive consolidation in a variety of industries... ATT and BellSouth is a recent example.

You are quite naive to think the DOJ cares about anything other than what they are TOLD to care about. And this Administration, Wall Street and Big Business very much want this merger (and all the others) to occur.

 

[luv2fly]

You are quite naive to think the DOJ cares about anything other than what the lobbyists tell them to care about. And the fact is that Wall Street and Big Business very much want this merger to occur.

Using your logic then, why wasn't the UA/US merge approved? I mean if Wall Street wanted it,which they did, why didn't it happen?

 

[Walmartgreeter]

Using your logic then, why wasn't the UA/US merge approved? I mean if Wall Street wanted it,which they did, why didn't it happen?

Wall Street never wanted it..U stock NEVER reached the offer price. DOJ turning it down was such an afterthought that has no bearing on on the Delta 2.0 deal. And remember, I have been right on just about every merger! Best, Greeter.

 

[FlyDCJets]

you guys really talk alot of s#it. it makes me laugh .

Yup the two "Arm Chair Experts" think that NW and its past and present labor issues is a better fit for DL, but it will not.
World is serving too much "Deltoid" Kool-Aid to rally the "Kiddies" on airliners.net, and Clue still thinks that more frequencies from PHL to MDW by WN is better for the local PHL economy than additional routes by US to Europe and beyond.
Regards
DC

 

[ClueByFour]

Yup the two "Arm Chair Experts" think that NW and its past and present labor issues is a better fit for DL, but it will not.
World is serving too much "Deltoid" Kool-Aid to rally the "Kiddies" on airliners.net, and Clue still thinks that more frequencies from PHL to MDW by WN is better for the local PHL economy than additional routes by US to Europe and beyond.
Regards
DC

As an FYI--airline routes have absolutely no effect (in and of themselves) on the economy of an area, without preexisting business demand in said area. Zero. It's far better for the several hundred (if not thousand) people who do PHL-ORD everyday to be able to do it at a competitive price rather than the perhaps 4 people a day who might go PHL-ZRH for work. I also disagree with giveaways to two time losers.

Keep 'em coming, genius.