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ARCHIVE: US LCC & AMR / AA Takeover / merger Rumors and Discussion (consolidated)

Old Feb 14, 2013, 9:50 am
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The AA - US merger was approved by AMR creditors and the boards of directors of both airlines on 13 Feb 2013, and announced the 14th.

There is no further speculation about whether the merger will occur; all that is pending is approval from the bankruptcy court and the regulatory authorities.

American Airlines and US Airways approve merger: just the facts, please outlines the facts we know;

AA - US Merger Agreement / Announcement Discussion (consolidated) is the thread for discussion of the announced merger.
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ARCHIVE: US LCC & AMR / AA Takeover / merger Rumors and Discussion (consolidated)

 
Old Feb 13, 2013, 12:32 pm
  #3706  
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Originally Posted by newyorkgeorge
Exactly. The kind of heavy flyers that are not on FT value routes, times, reliability. Essentially they want to get wherever they are going as quick as possible. They don't place this uber importance on a smiling FA, or a certain type of liquor available or whether the sundaes are pre made. Yes, they have interests including the inflight experience, the IFE system, lounges, etc. but for them its more a function of get me there ASAP with as many options as possible.
I agree. But when all things are equal, decisions will be made on the soft stuff.
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Old Feb 13, 2013, 12:37 pm
  #3707  
 
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Originally Posted by nkedel
What are the alleged benefits of this one?
Pixar is releasing amazing films at about twice the rate they did before the merger.
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Old Feb 13, 2013, 12:43 pm
  #3708  
 
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Originally Posted by DillMan
I'll stage an Occupy DFW protest if US comes anywhere near AA.
I'll be right there with you. No way I want to give up real glasses and warmed nuts in F!
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Old Feb 13, 2013, 12:44 pm
  #3709  
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Originally Posted by sts603
I agree. But when all things are equal, decisions will be made on the soft stuff.
I'm not so sure certain road warriors are even aware of some of the soft stuff. Heck, most of them have no idea what kind of a/c they are even on. They generally stick with on airline, usually the one that has the most robust service, and would have no idea what the other guys offer.
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Old Feb 13, 2013, 12:50 pm
  #3710  
 
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Originally Posted by uxb
Star has been taking a beating over the past couple of years. With a BK exit and the soon-to-be announced departures of US/JJ(/and likely TP) for OW. Despite having more airlines in their alliance, I cannot think of a single reason why Star would still be better than OW. I guess, maybe if you are going to China or Mongolia. That aside, there are some major holes in the Star route map. IMHO, OW acquisitions now represent quality over quantity. This seems to be lacking at the other two alliances, which will take just about anyone.
You don't need to go to China or Mongolia -- just Europe. Even leaving US out of the picture, you've got a lot more destinations on UA than on AA. As a big network carrier, LH is a lot easier to deal with than BA; as major secondary options go, the combination of LX, OS, and AC provide a lot more flexibility than just IB (and I guess . The result is a lot more chances of finding a good deal, a good schedule, or an available premium award seat.

OW is the only alliance without a Korean carrier. It's the only alliance whose US carrier doesn't maintain an Asian hub. Those are all competitive disadvantages. That's not to say there aren't advantages -- South America, obviously, being one -- but if given a choice between an alliance strong in Europe and Asia, and another strong in South America and Oceania, more people are going to choose the former.

As for the "quality over quantity" argument: AirBerlin.
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Old Feb 13, 2013, 12:53 pm
  #3711  
 
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Originally Posted by FWAAA
In fact, the publicly available data show that Delta does not get any additional significant revenue per mile above AA's levels despite DL's perceived stinginess with frequent flyer benefits.

In the aggregate, DL's mainline yield last year was all of $.0005/mi higher than AA's mainline yield. In the aggregrate, that yield differential was worth just $85 million to Delta. DL's 2012 pre-tax, pre-profit-sharing profits of well over $2 billion were driven by lower costs and DL's superior regional jet revenues (where AA should begin to catch up with the expansion in 2-class large RJs).
Yield while useful for directional changes ( ie given carrier's yield increases and DL's has quite significantly improved over the last few years while AA's has not) is not an apples to apples comparison between airlines. Various network difference and relative stage lengths have a big impact on yield, so highest yield in of itself is not a direct indicator of profitability. PRAMS is the most accurate method to determine flight profitability, not yield. AA's yield use to be well above DL's but not anymore given DL's very large improvements in that area.

Last edited by grahampros; Feb 13, 2013 at 1:02 pm
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Old Feb 13, 2013, 12:57 pm
  #3712  
 
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Originally Posted by newyorkgeorge
I'm not so sure certain road warriors are even aware of some of the soft stuff. Heck, most of them have no idea what kind of a/c they are even on. They generally stick with on airline, usually the one that has the most robust service, and would have no idea what the other guys offer.
Oh i think most of us most definitely notice those things. However the underlying assumption here is that these things will decline for current AA flyers. I'm just not so sure about that. Despite what many seem to fear around here, i dont see Parker trying to US AA. More the opposite is what i expect to happen in many, if not most cases.
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Old Feb 13, 2013, 12:58 pm
  #3713  
 
Join Date: Jan 2013
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Originally Posted by Xero
The US Y product is actually not that bad. I flew SFO-PHL and a few times and they did a beverage service 3 times and the seats are more comfortable than AA Y. The most I get on AA twice on a transcon. Yes, US used to suck in the past, but they suck less now.

The real fear is the change in the AAdvantage program. Sadly, I strongly feel that status and upgrades based on miles flown is going to go away very soon. It was great while it lasted.

The bright side is that US flies to TLV. Who knows whether US will keep the route our not, though, assuming they buy AA.
My biggest peeves wuth US F is the plastic cups and no warm nuts or meals on flights under 3.5 hours...but otherwise they are fine. If that's the worst downgrade I have to deal with I will survive!
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Old Feb 13, 2013, 1:03 pm
  #3714  
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Originally Posted by newyorkgeorge
I'm not so sure certain road warriors are even aware of some of the soft stuff. Heck, most of them have no idea what kind of a/c they are even on. They generally stick with on airline, usually the one that has the most robust service, and would have no idea what the other guys offer.
I guess it depends on the type of road warrior and the options available to them. Work in a law firm where some senior people log some serious international mileage every year. They certainly don't have the time to blog on FT or research things but they certainly discuss their preferences between carriers all the way down to which one has better movies.
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Old Feb 13, 2013, 1:04 pm
  #3715  
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I thin there are many variables - for example, US Dividend Miles has four status tiers - and if the "new AA" will as well, I'd not be amazed the AA "Lifetime Platinum" becomes the new Gold, with EXP (USDM Chairman's) and whatever they'd call the 75k status flyers (USDM Platinum) devaluing the AA LTP.

It's my hope if they do this they will retain three levels, to keep status levels comparable to oneworld's three (Ruby, Sapphire and Emerald) levels. USDM members may hope not.

But, we still have no announcement, and all this will take significant time if it happens - so we are speculating and hoping.

Originally Posted by grahampros
Oh i think most of us most definitely notice those things. However the underline assumption here is that these things will decline for current AA flyers. I'm just not so sure about that. Despite what many seem to fear around here, i dont see Parker trying to US AA. More the opposite it what i expect to happen in many if not most cases.
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Old Feb 13, 2013, 1:07 pm
  #3716  
 
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What I want to know is when/if the merger will bring flights to Montana. Tired of always having to rely on Alaska code shares.
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Old Feb 13, 2013, 1:07 pm
  #3717  
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Originally Posted by grahampros
Oh i think most of us most definitely notice those things. However the underline assumption here is that these things will decline for current AA flyers. I'm just not so sure about that. Despite what many seem to fear around here, i dont see Parker trying to US AA. More the opposite it what i expect to happen in many if not most cases.
I would at least give Parker credit that upon the merger he would realize that he was playing now in the big leagues. Furthermore, I think he would realize that DL and UA are the competition for his real bread and butter not as much WN or B6. Not to mention he now has hubs in the most lucrative travel markets in the nation.

Now that being said, the FF system in general is and will continue to move more towards rewarding higher spenders. Where that will end up in 2-3 years is somewhat unknown. You can bet that UA and AA (merged or not merged) will be looking at how successful DL is next year in adopting status based upon dollar spend. I tend to think unless UA sees a revolt its going this way. The question is will AA remain the odd man out trying to use it as a marketing tool?
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Old Feb 13, 2013, 1:14 pm
  #3718  
 
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Originally Posted by newyorkgeorge
FFs look at programs very differently based upon their needs. As an EXP that flys almost domestic I'm more concerned about things like full meal service going away on flights less than 3.5 hours or the ability to maintain unlimited, space available complimentary upgrades for EXPs.
I think the 3.5 hour meal rule has as much to do with the location of US' hubs as it does penny pinching (of which there is admittedly some). If you look at the distribution curve of US segment lengths, they tend towards the very long and very short -- and many of the ones in the middle are lower-yielding destinations in the middle of the country. If I had to put money on it, I'd guess the rule will be something more like 2.5 hours in a combined system (though I wouldn't bet much).

As for the unlimited upgrades -- I'm not sure why people are concerned that merging a carrier that offers top-level elites unlimited upgrades with a carrier that offers all elites unlimited upgrades would result in the elimination of unlimited upgrades. The industry trend in the US has been pretty universally toward that system; I'd be very surprised if it were rolled back.
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Old Feb 13, 2013, 1:20 pm
  #3719  
 
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Another view:

http://www.foxbusiness.com/industrie...airways-merge/
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Old Feb 13, 2013, 1:28 pm
  #3720  
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Originally Posted by sts603
Or OneWorld carriers continue to expand capacity in Asia (particularly through the AA-JL JBA)????? Why are you assuming that the current Asian route network is stagnant. The fact that AA is growing and gaining more passengers would more logically lead to a reason to more aggressively expand capacity.
Whatever AA's strategy is in Asia, "aggressive" is definitely not one of them. Not counting Tokyo, I can count exactly 4 TPAC routes on AA metal (you know, the ones I could actually use a systemwide upgrade on).

2 from ORD, 1 from LAX, 1 from DFW, and none from JFK or MIA.

So far AA's strategy with many of their JV partners has simply been more hub-to-hub. New long-haul hub-to-spoke growth has been somewhat unimpressive.

Last edited by 787fan; Feb 13, 2013 at 2:04 pm Reason: changed NRT to Tokyo.
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