Want to save real money US? Then merge


Aug 20, 2002
One thing is clear. There no longer exists any real advantage to leaving the three wholly owned regional subsidiaries separate. Historical advantages such as negotiating leverage and contract disparity no longer justify the increased cost of maintain three regional airlines.
1. All three contracts are now close enough in costs (for the first time) that they can blended into one.
2. All three pilot contracts will become ammendable at the same time. This further reduces managmenet''s leverage
3. A intergrated senority list will already be developed between ALG, PDT, and PSA for the flow thru thus resolving the major issue hindering a smooth merger of the pilot groups.
4. No better time exists to complete this merger as all three regionals are also in bankruptcy reorganization. Keep what assets you need and discard the rest.
5. Commonality in the future fleet can easily be created while replacing current aircraft types.
6. Shared assets can increase efficency and organization. (MNX, training, safety, ground support). One managment and support structure can be untilized instead of three separate ones.
7. Recent actions and court filings by US Airways Group and the prcedents set by AMR and Mesa Air Group have created a favorable enviorment for a songle carrier filing by the pilot groups with the NMB
8. The establishment of a flow thru with MDA and then Mainline will retool these regionals into a career step instead of a resting place. This reduces labor pressure upon the cost structure in place.
9. Long term stable contracts are now in place, with no chance of a work action until the end of this decade.
10. Future revenue potential from a possible IPO would increase to reflect the greater value of a merged entity.
Now is the time, if not now, when? If not this, what?
Wholly owned are an asset only to Usairways..the routes are owned by usairways , U gives money to run the wholly owns..so unless U decides to sell the routes with the Wholly owned ; the only thing U can sell is the names that are associated with the Wholly owns.

The best thing to do is to merge the wholly owns and get rid of some of the VP's. They could have a northern ,Central and southern sector and set up regional directors for those sectors..Have one dispatch center. I guess the challenge is what to call the merged airlines..I say just simply usairways express would do .l
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Selling the wholly owned regionals now, care to elaborate why itis such a good idea?

Sell now, you dont get jack for what has been a very profitable enterprise for US Airways for years. Sell later on (or IPO) after the three have been merged, reequipped with an all jet fleet, and code sharing with a resurgent US Airways and it would bring a bonanza for Group.

Part of the problem here at US Airways is that they have ignored what could have made them much more competitive ----> their own regionals. While other majors have invested in themselves and added hundreds of RJ's in house US Airways has relied on outside companies instead.

Ask yourself, which two majors rely upon affiliate regionals for all their RJ flying? Thats right, the two most financially weak majors US Airways and United Airlines.

Also note the fortunes of these outside companies that get to do that flying. Places like Mesa, ACA, Skywest, and Wexford are flying high still on the guarenteed profits they makle from flying RJ's for US and UA. Sure would have been nice to have kept those profits to ourselves nowadays... Might even have been enough to make up the 400 Million Dave is going to come looking for from ALL of us.

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