Northwest negotiating for its own purchase by American... the principle is conceded, only the price remains. In another thread, Randy asks if NWA is worth $100 a share. It's worth what AA will pay, and that probably will end up about $65-70. If it goes through, will it be good for frequent flyers ? I don't think so. I think this merger will join the United/US AIRWAYS and probably Delta and Continental. That will reduce competition, reduce options, reduce the relative importance of ff programs, and put the frequent flyer more and more at the mercy of the Three Great Big Airlines.

I hope- and I think it's likely- that the government will ask some tough questions and consider the implications of these mergers.

What you do think ?

The latest airline merger-mania has very interesting consequences for passengers and FFs. AA with NW, BA with KL, UA with US, DL with CO, to name a few. In terms of airline alliances alone, the mergers would be very, well, eventful.

So the US goes from six to three main airlines. In Canada, we just went from two to one as AC bought CP. I think the questions raised about the mergers will be very similar in the US to what is going on with AC/CP right now.

FewMiles..

About a month or two ago, I remember asking the gal at the local NW ticket office, if it was time to buy NW stock. Believe it was in the low 20's and didn't look so pretty. My intuition was working, but it never tells me what to do, like in definitely! ANother chance of turning rags into riches goes by.

The irony, I suppose, is that one of the sentiments of the Airline Deregulation Act of '78 was to move away from the domination of 3-4 large carriers. Many warned of the possibility of AmFly. Is this yet to come? Probably not, but it's interesting that in the spirit of competitiveness, it appears we've gone from the Big 4 to the Big 3 in only 22 years.

Such major consolidation would definitely not be good for consumers, and I believe that the government would prevent it from happening. I think the UA-US deal won't get through unless they do so major changes to the proposed deal, shedding a lot. I would think being forced to shed such dominance in so many big markets would keep them from consummating the deal.

Of course, who knows what will happen if W wins. I'm no fan of Gore for by a long shot, but I shudder at the possibility that these mergers could go through a GOP DOJ.

What if... the UA-US, AA-NW, DL-CO mergers were allowed to happen, but then foreign carriers were allowed to compete on domestic routes? Would that be a plus, or minus?

(Doesn't seem very likely to happen, though, does it?)

I would also like to add: is it good for frequent flyer programs? In many respects, AA and DL have programs that are less generous than NW and CO, respectively.

Where do you suppose it would end up? Unlimited domestic upgrades or not? Or something in between? These are big perks for the NW and CO crowd. Wonder where these issues hang in the balance?

JL2

I think in a larger merger both NWA and CO elites would lose their unliimited upgrades. There would be less necessity for them, as it is unlikely the main competition ( the UA/USA merged airline) would offer unlimited upgrades.

I think much else would be lost as well.. including quality of service. This may well be a case where bigger is not better. Airlines that are not doing a great job at present in getting their pax from one point to another in relative comfort and not likely to do a lot better with 50% more pax. Nor will they have as much incentive if just one of them controls over 25% of the market.