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Old May 12, 05, 11:08 am   #1
 
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Let's not emotions get in the way of looking at a HP/US merger

Let’s look at a merger rationally.

Parker has said that the airline industry needs consolidation and that HP will participate in this. HP is big in the west. US big in the east. US is about twice as large as HP and flys to 15 cities in Europe profitably.

Now US management and cost structure were in the pits and management floundered. Therefore the second bankruptcy, which was lead by financial people outside the industry. Along comes merger discussions that can allow HP to triple in size and give Parker what he knows he needs–i.e. a east coast presence and national footprint. Costs are still going down on US as senior employees leave and will continue throughout this year (over 1,000 senior flight attendants alone are leaving). Within the last couple of days, US has proposed parachutes for salaried employees to stay pending any merger (1200 are included that would be laid off)–additional savings. US in its second bankruptcy has been saying wants to adopt the HP model with simplified fares and labor contracts have already been based on HP’s contract.

To make a merger work Parker needs to keep both HP and US’s frequent flyers happy to get each to fly on the other. I would see the best of both programs being adopted CP and CP desk for 75,000 miles (let me tell you its always nice to have a phone answered, “How may I help you Mr. Abeflyer.”).

Parker from everything I have read is a people person with his troops. US hasn’t had that since the 80's. Just encouraging the troops and giving them a ray of hope should improve moral.

As to PHL, well, its actually been improving lately. Whoever is this month’s manager (frequent changes have happened there), seems to have gotten the troops to recognize that US planes do reach PHL on time and they have to be at the jetway when the planes park (instead of 15-20 minute waits, the jetway has started to move as soon as the plane stops recently).

The merger is actually a cheap way for Parker to build a national airline in his own vision and get into an alliance. Think how much it would cost in money and years forParker and HP to duplicate the US footprint. The finances on the US side are now mainly in order. Unsettling if it happens, yes, but they would be ahead of the UA and DL that have yet to confront their problems.
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Old May 12, 05, 11:42 am   #2
 
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What you said abeflyer. However, I probably see the New US Airways having the 100k CP level. But like I said in another post. They will have many exceptions on the first year when the merger is complete. The exemptions desk will have their hands full and I think may of you who are at HP's top level will automatically be converted over to CP. The CP desk is a very nice perk to have.
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Old May 12, 05, 1:11 pm   #3
 
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I don't oppose this merger based upon emotion, though I can understand the feelings of many of the AWA employees. I have reservations because AWA is one of the few large (Over $2bln in sales) corporations we have based here in AZ and I'd like to see it survive. I've read many entries on the US board, it seems to be an airline chock full of crappy management and bitter employees. Even if Parker's team injects a fresh perspective, two (sometimes more) decades of animosity do not simply vanish overnight. It just boggles my mind that one of the most successful spawns of deregulation would want to saddle itself with this dinosaur. The combined company will be back in BK court within a few years, and will then likely be forced into the arms of one of the big boys on the cheap. There goes my hometown airline.
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Old May 12, 05, 1:18 pm   #4
 
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Woah! Not used to seeing you guys over here in the HP forum!

I agree completely. The merger should be viewed by HP as a major opportunity, and by US as a saving grace. HP will have the opportunity to substantially expand as a result of the merger (and acquire a name with more international appeal to it, but that is completely my OWN opinion and I don't mean to start another discussion on which airline has the better name!) and consolidate, which is desperately needed. I LOVE the idea of seeing the "America West" brand surviving as a regional carrier flying from LAS, PHX, and even LAX out west, as mentioned by FAN over in another thread. That would at least preserve the company's name- hopefully the regional airline would even fly some of the E170's, which are very nice planes.
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Old May 12, 05, 1:23 pm   #5
 
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Quote:
Originally Posted by ibdsux
I don't oppose this merger based upon emotion, though I can understand the feelings of many of the AWA employees. I have reservations because AWA is one of the few large (Over $2bln in sales) corporations we have based here in AZ and I'd like to see it survive. I've read many entries on the US board, it seems to be an airline chock full of crappy management and bitter employees. Even if Parker's team injects a fresh perspective, two (sometimes more) decades of animosity do not simply vanish overnight. It just boggles my mind that one of the most successful spawns of deregulation would want to saddle itself with this dinosaur. The combined company will be back in BK court within a few years, and will then likely be forced into the arms of one of the big boys on the cheap. There goes my hometown airline.

Remember, in all likelihood, the headquarters of the merged airline would be in Phoenix, not in CCY.

I'm not sure I understand the "decades" of animosity you mention. There used to be excellent morale in most US employees. The mid 90s were a great time for USAir, and even as recent as just before 9/11 employees weren't in the same mindset as they are now.
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Old May 12, 05, 1:35 pm   #6
 
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Quote:
Originally Posted by GotCalcio4
Remember, in all likelihood, the headquarters of the merged airline would be in Phoenix, not in CCY.

I'm not sure I understand the "decades" of animosity you mention. There used to be excellent morale in most US employees. The mid 90s were a great time for USAir, and even as recent as just before 9/11 employees weren't in the same mindset as they are now.

My ultimate point is the combined company may not survive. It won't matter where the HQ is at that point.
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Old May 12, 05, 4:18 pm   #7
 
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Quote:
Originally Posted by US AIRWAYS FAN
What you said abeflyer. However, I probably see the New US Airways having the 100k CP level. But like I said in another post. They will have many exceptions on the first year when the merger is complete. The exemptions desk will have their hands full and I think may of you who are at HP's top level will automatically be converted over to CP. The CP desk is a very nice perk to have.

I agree. Perhaps they will have some mercy and allow current HP Plats to keep the highest level for a year, but after that, they need to fly 100,000 miles per year to remain at that level. Of course, in the long-run, US CPs will benefit more than former HP Plats as we are used to having to fly at least 100,000 miles per calendar year.
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Old May 12, 05, 4:56 pm   #8
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Quote:
Originally Posted by fly747first
I agree. Perhaps they will have some mercy and allow current HP Plats to keep the highest level for a year, but after that, they need to fly 100,000 miles per year to remain at that level. Of course, in the long-run, US CPs will benefit more than former HP Plats as we are used to having to fly at least 100,000 miles per calendar year.
I hope they don't. I hope they base it on how many miles you flew in the prior year OR your pace in the current year. To give all HP Plats the CP status would seriously degrate the benefits of that level and likely overwhelm the service system in place.

What I think would be fair: If you flew 100K+, you're obviously in. If you're a current HP Plat and on pace for that this year you're also in for the balance of the current year. They could take last year's numbers and say, perhaps, anyone over 87,500 (half-way between 75K and 100K) will also get upgraded to the CP status for the balance of this year.

Beyond that, they could set up a challenge system: Sign up and fly at the pace for 3 months and you'll get the status.

Given that it would take a while to combine the frequent flyer programs and re-allocate resources into the right areas, I think that just giving everyone at the current HP Plat level the CP status would be a big mistake, unless, by the time they get a deal done there are only a couple of months left in the year anyway, in which case it wouldn't matter a great deal.
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Old May 12, 05, 7:08 pm   #9
 
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Quote:
Originally Posted by AZ Travels the World
I hope they don't. I hope they base it on how many miles you flew in the prior year OR your pace in the current year. To give all HP Plats the CP status would seriously degrate the benefits of that level and likely overwhelm the service system in place.
Good point AZ, but there's one intangible you're not taking factoring in...just how addictive being a CP is!

The CP desk rocks. Simple as that. Those men and women, our "angels", are the best in the business. Once a FF gets a taste of the personalized service CPs are afforded they never want to go back to being "only" gold, or any other level. A search on the US forum will bring up numerous instances of a CP being saved by the CP desk. For instance, on Tuesday I was heading out on a 10 day/4 city/3 carrier trip. I had difficulty checking in on AC, which after a call to the CP desk I realized was due to the fact that it was a paper ticket (which I hadn't yet received.) All I had to tell her was "I'm at the AC counter and they can't find my reservation" and she immediately spouted off my flight number, ticket number, the fact that it was a paper ticket, when and where it was mailed. I was instructed to head down to the US ticket counter (luckily in the same terminal) to fill out a lost ticket application while she called and gave them the heads up. The ticket agent, while very friendly, gave me completely different information than K* on the CP desk had. I was now told that I had to purchase a new ticket it I wanted to get on the plane! While my corporate travel desk wasn't too pleased with this, they went ahead and purchased the ticket.

As I'm sitting on the plane 20 minutes before departure my phone rings...it's K* from the CP desk: "Ms. shell nyc, are you on the plane?" When I confirm that yes, everything is ok, I made the flight she replies "The Newark desk was wrong. They should not have charged you for a new ticket. I'm so sorry. I went on a break and came back and saw what they did..." I replied that it was all ok, I'm on the plane, the agent gave me the forms to fill out and fix this later. "No, it's not ok. It was wrong, and it was a hassle, and you don't need that. I'm going to call revenue and see what we can do to fix this. I'm really sorry."

This is just one example of the kind of service US offers to it's CPs. This is why I will continue to fly them despite the dirty planes, deteriorating F service, closing of clubs, and all of the other things they are doing wrong right now. I believe that if they keep the highest elite tier at 100K/100 segs (and keep the CP desk), the comped HP Plats will find a way to fly the extra miles to requalify year after year. It really is worth it folks...
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Old May 12, 05, 8:07 pm   #10
 
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Quote:
Originally Posted by AZ Travels the World
I hope they don't. I hope they base it on how many miles you flew in the prior year OR your pace in the current year. To give all HP Plats the CP status would seriously degrate the benefits of that level and likely overwhelm the service system in place.

What I think would be fair: If you flew 100K+, you're obviously in. If you're a current HP Plat and on pace for that this year you're also in for the balance of the current year. They could take last year's numbers and say, perhaps, anyone over 87,500 (half-way between 75K and 100K) will also get upgraded to the CP status for the balance of this year.

Beyond that, they could set up a challenge system: Sign up and fly at the pace for 3 months and you'll get the status.

Given that it would take a while to combine the frequent flyer programs and re-allocate resources into the right areas, I think that just giving everyone at the current HP Plat level the CP status would be a big mistake, unless, by the time they get a deal done there are only a couple of months left in the year anyway, in which case it wouldn't matter a great deal.

True, but US Airways is notorious for its studies of Chairman's Preferred members. They pretty much analyze who are the big spenders within the CP level. I have a feeling that US Airways is going to convince HP to only grant CP status to those who have either spent lots of money on the airline or have flown close to 100,000 miles. Of course, HP will most likely favor the idea thinking that former Plats will now have an incentive to spend more money to reach the new highest level.
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Old May 13, 05, 12:42 am   #11
 
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Quote:
Originally Posted by abeflyer
Let’s look at a merger rationally.

Parker has said that the airline industry needs consolidation and that HP will participate in this. HP is big in the west. US big in the east. US is about twice as large as HP and flys to 15 cities in Europe profitably.

Now US management and cost structure were in the pits and management floundered. Therefore the second bankruptcy, which was lead by financial people outside the industry. Along comes merger discussions that can allow HP to triple in size and give Parker what he knows he needs–i.e. a east coast presence and national footprint. Costs are still going down on US as senior employees leave and will continue throughout this year (over 1,000 senior flight attendants alone are leaving). Within the last couple of days, US has proposed parachutes for salaried employees to stay pending any merger (1200 are included that would be laid off)–additional savings. US in its second bankruptcy has been saying wants to adopt the HP model with simplified fares and labor contracts have already been based on HP’s contract.

To make a merger work Parker needs to keep both HP and US’s frequent flyers happy to get each to fly on the other. I would see the best of both programs being adopted CP and CP desk for 75,000 miles (let me tell you its always nice to have a phone answered, “How may I help you Mr. Abeflyer.”).

Parker from everything I have read is a people person with his troops. US hasn’t had that since the 80's. Just encouraging the troops and giving them a ray of hope should improve moral.

As to PHL, well, its actually been improving lately. Whoever is this month’s manager (frequent changes have happened there), seems to have gotten the troops to recognize that US planes do reach PHL on time and they have to be at the jetway when the planes park (instead of 15-20 minute waits, the jetway has started to move as soon as the plane stops recently).

The merger is actually a cheap way for Parker to build a national airline in his own vision and get into an alliance. Think how much it would cost in money and years forParker and HP to duplicate the US footprint. The finances on the US side are now mainly in order. Unsettling if it happens, yes, but they would be ahead of the UA and DL that have yet to confront their problems.
nice in theory but, rationally, implementable?? the AFA and ALPA merger policies-- very strictly worded to measure seniority from original date of hire-- force giving US's labor almost totally dominant seniority rights systemwide in a merged operation. there's no way for HP to expand by buying US without effectively trashing its own employees.

as for US losing senior employees, at this stage at least it's of limited benefit-- the returning employees also have a ton of seniority and are high in the payscale. they're recalling voluntary-furloughed FA's with over 10 years in, this summer.

US's finances are anything but mainly in order. Their unit revenue is in complete free-fall with the new entrants hammering its previous fortresses-- down over 9% in the first quarter, much much worse than any other legacy carrier, and much much faster than any costs are falling. A merger wouldn't make those entrants less aggressive-- merely expose HP's assets and put at risk everything they've built these last few years.

US is a chinese fingertrap for HP-- attractive on the outside but only an impediment in the end.

the proof of the pudding will be in the cash of course-- the most recent estimate is several hundred million in further outside financing would be required to put this through, and that's presuming the agreement of shareholders and labor groups.
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Old May 13, 05, 8:37 pm   #12
 
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Phew !

Many thanks to the power of the skies to be US 1 and HP Platinum - win/win

Have to agree though - having transferred at least 75k of flying to HP -- The agents are cool and all, but the CP desk has taken the cake for the "feel good" service they give. I just got a call from one of my favorites last week (just for example, how many airlines can you say that with ??) - she's taking the buyout in August - low morale after 19 years ... too bad.







[quote=shell nyc]Good point AZ, but there's one intangible you're not taking factoring in...just how addictive being a CP is!

The CP desk rocks. Simple as that.
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Old May 13, 05, 8:58 pm   #13
 
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Let's not emotions get in the way of looking at a HP/US merger

Considering the way that CCY has affected what we US folks have had to experience over the past year, is it not safe to say that with the rumored merger things are only looking up?

And yes, I think lots of us US folks are checking things out over here... where the grass is greener... and I would guess there's still glass up front?
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Old May 14, 05, 1:46 am   #14
 
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Quote:
Originally Posted by martin33
the AFA and ALPA merger policies-- very strictly worded to measure seniority from original date of hire-- force giving US's labor almost totally dominant seniority rights systemwide in a merged operation. there's no way for HP to expand by buying US without effectively trashing its own employees.
on the US boards it was pointed out that ALPA's policy was revised to be less strictly date-based.

meanwhile, the buzz is certainly growing that a deal is to be done.
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Old May 14, 05, 9:35 am   #15
 
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Quote:
Originally Posted by martin33
on the US boards it was pointed out that ALPA's policy was revised to be less strictly date-based.

meanwhile, the buzz is certainly growing that a deal is to be done.

One thing I think people are forgetting, even though US Airways name is carrying forward, HP's management is the dominant player... Why merge two airlines and give the failing airline the reigns...

With regards to Flight Fund, I would not see HP moving to piss off it's happy customers (ie Platinums) to try and please it's already unhappy US AIR customers... There will be a transition period and I am sure it will not be a lose-win for anyone.... they want to keep and attract customers. Probably would start as code-shares... with 2 separate programs until they could integrate them...
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