Who wants a merger with US?

[737823]

Nah, no need. 700UW's legitimate. He was on the negotiating committee during US's bankruptcy. If you'd been around the forums for more than a few months, you'd know that.

Been here nearly two years, quite a bit more than a few months. 700UW keeps saying I should educate myself on the IAM, RLA, unions, etc. Fine. Provide me the links with information about his leadership and awards and I can learn from them and judge accordingly.

Josh

 

[WorldTraveler]

The reason why DL expressed an interest in AA is because it does not want the industry to consolidate under US' control. All of these fans who claim that US would do so much for AA can't seem to connect with the reality that US does not generate unit revenues (amount of money per seat) compared to other network airlines.
The industry - DL included - does not want a carrier who cannot keep up with the big boys gaining control of more industry assets so they can do the same thing as they already do - and there is no evidence - none - that US could increase revenue production to industry standard levels just because they would control AA, which incidentially does produce higher quality industry revenues.
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And then there is the strategic issue that AA has assets that DL would like to have if the opportunity arises for consolidation.
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AA's future will be determined first by their own attempts to restructure and then if their creditors don't believe AA can generate acceptable returns to the creditors, proposals will be accepted from outsiders. But be very clear that US will not be the only bidder - and against just about any of them, BA/oneworld, DL, US based non-airline investors, US will have a very hard time presenting a competitive bid given the weakness of US' own financials in comparison.
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The whole AA-DL overlap is significantly overblown given that AA still has not cut the capacity it needs to in order to demonstrate that it can operate a long-term profitable airline.... AA's position in NYC, the largest part of the AA-DL could very well be a whole lot smaller if AA is forced to cut flights that don't make financial sense. example 1 - we all know the 762s are going to go because they are not viable aircraft any longer - and with it AA has to restructure its transcon flying - but that hasn't happened and when that does happen, AA's revenue and its competitiveness in the market will also fall.
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And it is still possible that a couple of airlines or parties could present bids that together would be superior to US and between them have no antitrust issues.
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But once again, the fascination with carving up AA needs to be submitted to the reality that AA is nowhere near the point where it has to consider competing bids.

 

[USFlyer]

Wouldn't the IAM+TWU be the ultimate concession machine? Can't imagine that would be too great for AA employees. Face it, US Air is a pathetic carrier with hubs in secondary markets, no Asia presence, limited Caribbean routes, no real first class product, and abysmal labor relations. All AA would gain of value is DCA, a few Europe routes and TLV. All of which AA could enter on their own.

Josh

And PHL -- the largest metro market in the US with only one airport.

And CLT -- a growing city with a population that is actually larger than ATL (though the metro region is smaller).

And sizable N/S east coast market share, which AA lacks.

US is also bigger fleet-wise than British Airways, Air France, etc. -- it's not a mom and pop carrier that has no value.

 

[Hopeful]

Read this article...pay attention the paragraph where it says AA is hampered by JFK inability to grow domestic...
I say JETBLUE when all is said and done!

http://www.ft.com/intl/cms/s/0/a75c0ae2-7746-11e1-baf3-00144feab49a.html#axzz1rXz9VdD3

 

[AAviator]

You seem to be a little on the arrogant side, does not bode well for you, most of us hope you don't get screwed like we did, it's kind of ignorant to to bring up our pay, we know it stinks and hope you will not drop to our level. Good luck!!!

I was answering the question posed in post #7.

Maybe the LCC cheerleaders who think LCC is profitable need to hear what helps create those anemic results. Agreed?

Since 2007 when the operations were combined, LCC has:
2007, profit of 436 million
2008, loss of 808 million
2009, loss of 499 million
2010, profit of 447 million
2011, profit of 111 million

(net) loss since operations combined, 313 million.

The GAAP numbers are even uglier.

Since the AWA/USAirways combination, LCC hasn't made so much as a plugged nickel.

 

[damajagua]

AA/US combo would be a disaster. I agree with the theory full domestic code share with JetBlue in NY
Alaska in Seatle. A Mergers a long the latter two in the future. No offense to the US people but AA does
not need nor would it benefit from a merger that involves US. Good luck to all.

 

[737823]

Serious question-which union would be more palatable for employees in maintenance IAM or TWU?

Josh

 

[strikeforce]

Serious question-which union would be more palatable for employees in maintenance IAM or TWU?

Josh

they both suck!

 

[luvthe9]

I was answering the question posed in post #7.

Maybe the LCC cheerleaders who think LCC is profitable need to hear what helps create those anemic results. Agreed?

Since 2007 when the operations were combined, LCC has:
2007, profit of 436 million
2008, loss of 808 million
2009, loss of 499 million
2010, profit of 447 million
2011, profit of 111 million

(net) loss since operations combined, 313 million.

The GAAP numbers are even uglier.

Since the AWA/USAirways combination, LCC hasn't made so much as a plugged nickel.

Sorry then, we realize this we don't need proof, work with us to prevent this, WE KNOW THIS WIILL NOT BE GOOD FOR YOU, TRUST US.

 

[Buck]

Serious question-which union would be more palatable for employees in maintenance IAM or TWU?

Josh

A non AFL-CIO union...

 

[wings396]

I was answering the question posed in post #7.

Maybe the LCC cheerleaders who think LCC is profitable need to hear what helps create those anemic results. Agreed?

Since 2007 when the operations were combined, LCC has:
2007, profit of 436 million
2008, loss of 808 million
2009, loss of 499 million
2010, profit of 447 million
2011, profit of 111 million

(net) loss since operations combined, 313 million.

The GAAP numbers are even uglier.

Since the AWA/USAirways combination, LCC hasn't made so much as a plugged nickel.



Can you please post AA's Stellar numbers for the same years...

 

[FWAAA]

Can you please post AA's Stellar numbers for the same years...

Ahh, the time-tested "My money-losing airline sucks less than your money-losing airline" argument.

AA's numbers are ugly for that same period but that doesn't negate AAviator's point: Despite two bankruptcies (at PMUS) and industry-trailing wages, US has posted an aggrgate net loss since the merger with once-bankrupt HP.

Analysts have estimated that AA's wages have been about $2.2 billion higher than they would have if AA enjoyed the US contracts and pay scales. Had it not been for the US pilots' inability to identify the real enemy (Parker and management instead of each other), US' labor costs would not be as low as they've been. How many tens (or hundreds) of millions more would US have to spend to bring the pilots and flight attendants up to AA pay rates?

 

[wings396]

Understood, but either way AA has lost Billions of dollars, and lower wages wouldn't have covered it all up. Granted that US is smaller, and has lower revenue generation to begin with. AA's business model is flawed, and they have failed to capitalize on past mergers. This is the main reason most AA people cringe and the thought of another merger. If done properly they can solidify a profitable company. Buying airlines only to dismantle them is not the way to go. Looking back at the US mergers with PS & PI are a reminder of that given that the entire PSA system was gone within a few years. Currently CLT and it's outstations are just about all that is left of the PI system after 22 years. The outcome of the TWA purchase may have been different had it not been for the timing just prior to 9/11.

 

[ebwgs]

2008: $2.1 billion loss
2009: $1.5 billion loss
2010: $471 million loss
2011: Somewhere north of $1 billion and Chapter 11.

Something Special in the Air.

 

[FWAAA]

Understood, but either way AA has lost Billions of dollars, and lower wages wouldn't have covered it all up.

AA made a small profit in 2006 and a larger profit in 2007, and then four dismal years after that. If AA had paid $2.2 billion less for labor expenses each of those six years (2006-11), AA would have reported an aggregate profit.

Granted that US is smaller, and has lower revenue generation to begin with. AA's business model is flawed, and they have failed to capitalize on past mergers. This is the main reason most AA people cringe and the thought of another merger. If done properly they can solidify a profitable company. Buying airlines only to dismantle them is not the way to go. Looking back at the US mergers with PS & PI are a reminder of that given that the entire PSA system was gone within a few years. Currently CLT and it's outstations are just about all that is left of the PI system after 22 years. The outcome of the TWA purchase may have been different had it not been for the timing just prior to 9/11.

I don't disagree with most of the above. September 11 interferred in a giant way with the status quo of all airline employees and airlines, including the TWA purchase. When AA bought TWA, Mayor Daley was still insisting that ORD would never see re-aligned parallel runways, and thus part of the reason for the TWA puchase was that ORD had hit max capacity in 2000 with no assurance that capacity would ever increase. The plan was to focus ORD on O&D traffic and funnel more connections over STL. Of course, CHI traffic is down and the runways are finally being re-aligned into a parallel configuration. Once that project is complete, ORD will probably have more capacity than it will ever need, especially if CHI's economy doesn't improve.

I disagree that the AA business model is flawed and some of what Horton is trying to do will fix the disparity between AA and the others. UA, DL and US all enjoy relaxed scope on large RJs compared to AA's more restrictive scope. If AA still fails a few years from now even though it might have 150-200 more large RJs than it does now, then I'd agree that the business model was flawed. Right now, however, the playing field isn't anywhere near level. AA has much higher labor costs than any other network airline, has more restrictive scope (both pilots and ground unions) and hasn't yet shed large amounts of debt or pension in Ch 11 like everyone else did.