US Airways Dividend Miles (Pre-FlightFund Merger) - European Commission Approves Merger

http://www.usairways.com/corporate/press/nw_01_0112.htm

Of course, this is only a step in the direction of a merger, as the US government still has to approve it. But I've always wondered - Why does the EC need to approve this merger in the first place? I realize that both UA and US have European routes, and I'm guessing it has something to do with some trans-Atlantic agreement the US has with Europe, but I don't really know. Can anyone shed some light on this matter? Thanks. http://www.flyertalk.com/forum/smile.gif

The approval is conditional on giving up routes on the German- US market. Silently over the last couple of years US Airways had sneaked up on the US competition and has become the third player in terms of American airlines in this market behind United and Delta but ahead of AA which constantly gave up market share and has only 2 daily flights left and the bigger airlines NW and CO. 4 daily flights with roughly 900 seats from FRA and MUC. If you read the statement United will have to give up slots especially on this routes FRA to PHL,PIT and CLT and MUC PHL. Has also to do with the fact that the new UA/US and LH link via the star alliance will rule the skys between Germany and the US offering tons of flights. Talk to AA people in FRA and they oppenly admit they gave up on Germany because they can not compete with UA/LH as it is. I fear that giving up slots could mean that foe example CLT could loose its FRA flight which would be a breach of the merger promise. So it mught not be all good news for PIT and CLT.
I would hate that because they are the best airports in the US for entering the country and transfer from international to domestic.

Thanks for the info, eurousair! I also found some more specific info about the investigation in this WSJ article: http://public.wsj.com/sn/y/SB979316712102389226.html

It looks like you hit all the main points in your post though.

i think they were hinting more at UA giving up some slots as opposed to actual routes.

I would expect that the EU will force them to cut back on flights between JFK - FRA, ORD - FRA, or IAD - FRA where UA/LH have multiple daily flights. Eliminating PIT, CLT, or PHL doesnt really help the competition as there are no competitors (only US/LH on the PHL route) as it is.

Also, Germany and the US have some form of open skies so any new entant could theoretically start up flights between any two city pairs. The problem is FRA and MUC (FRA especially) are heavily overburdened and securing a favorable slot time is difficult for new entrants (as evidenced by TW recently).

By forcing UA/US to give up some slots it is believed new airlines would start up service.

So i doubt you will see any elimination of PIT or CLT service. maybe one of the PHL services would have to go but more likely are the other UA hubs.

How about LUFTHANSA giving up some slots! They're dominiating FRA almost as badly as BA weighs in at LHR. After all there are only 5 daily UA flights on UA metal out of FRA, with one more from MUC and DUS each.

If this merger against hope ever has to happen, maybe this is a chance for the new UA to rememember some of their abandoned/forgotten customers in other countries around Europe, like Switzerland for example. http://www.flyertalk.com/forum/rolleyes.gif

indogulf,

According to the local paper (Tribune Review) , and I quote 'Pittsburgh to lose non-stop service to Frankfurst'.

Personally it proves to me the average journalist is an idiot. http://www.flyertalk.com/forum/smile.gif Yes, I think its a possibility but like you said not definite. United just said it would give up the slots. Whether PIT or CLT-FRA are the routes to get pulled is up to their route planning folks to decide.

dg1 - i agree it IS a possibility that we would lose service to FRA however I think it relatively unlikely given 1) the "promise" to keep all existing routes (since the EU will not specify route just demand slot reductions) and 2) the PIT - FRA flight is quite profitable for US today so no reason it wouldnt be for UA and 3) PA politicians can still oppose the deal (specifically, Shuster, Specter, and Santorum, our fearless leaders http://www.flyertalk.com/forum/wink.gif )

and you know as well as i do that the Trib is pretty useless when it comes to real news and the PG is close behind and lets not even start with the TV stations http://www.flyertalk.com/forum/smile.gif

Just want to let the folks in PIT know that the german section of loyal customers is routing for the FRA-PIT flight as well.
Gives me my best and fastest connection into CMH from FRA.
Even more important than my few $$$ there are some big companies in the Pittsburgh area like the american arm of german pharmaceutical company Bayer
which utilize the nonstop on the expensive tickets and therefore I think the route must make money. Also the use of the A 330 indicates its a business route with premium seats being sold. I would guess FRA to CLT will be more of a problem.

[This message has been edited by eurousair (edited 01-15-2001).]

Oh I know the PIT-FRA route is a big money maker for US -- which is why it got the 330 so fast. Like eurousair pointed out, with Bayer's US HQ here (I used to live down the block from them...) there's plenty of high-flying executives going back and forth.

I'm not worried. A lot of PIT routes may be in trouble of being X'ed but this is one that I know has always been good for US. Wonder what's the story with CLT though...

indo: Per quality local media, that and the variety of food are the only things I miss in leaving New York City http://www.flyertalk.com/forum/smile.gif

If in fact the EU really thinks service to Germany should be decreased (because NO ONE will fly CLT and PHL >> MUC and FRA if UA/LH doesn't), they have once again proved that they don't know enough about the industries they regulate (the flap over Boeing's contracts with DL and AA being another example).

bayer is just one of a great many european firms with significant presence in the PIT area. a survey was dine a couple years back and it was found that over 400 european companies have their US or regional HQ in the mtro area. it is true that only a handful (Bayer, Adtranz, ABB, etc) are actually decent sized companies but even the small ones cumulatively send enough premium fare pax to make flying out of PIT profitable. however, multiple flights to the same intl. destination are not really required.

there was another survey done that on an average day anywhere from 250 - 500 pax originate in PIT for destinations like NRT, HKG, TLV, etc. this doesnt necessarily justify non stop service but it does indicate suffcient demand for convenient one stop/direct services.

also, with a growing number of tech companies (PIT is 5 or so in number of such jobs) and the existing base of companies there is a significant amount of premium O/D traffic.

i guess the entire point of my post is that despite all of the comments, speculation, etc. it's my strong opinion that PIT shouldnt be written off as a strong hub for the combined UA/US. I think people will be surprised and PIT will remain a proper hub with a strong netwrok of destinations - maybe even more than today. definitely there will be changes but in the long term i think PIT will survive. i actually think that PHL will eb the one to suffer the most due to its inherent delay problems due to its location not to mention close proximity to IAD, BWI, and JFK all points with strong UA/US presence. but anyways that's a different discussion.

well, sorry for the long post but i've been wanting to say all that for a while http://www.flyertalk.com/forum/wink.gif

Hey indo, PIT's always going to get bashed due to its reputation. But those of us who live here know better. If air travel continues to increase I think the future is quite rosy as ORD gets more and more crowded. If air travel decreases however its a whole new ball game.

I do think there may be some cutbacks here and there but nothing to jeopardize much of the jobs or most of our service (we might lose a flight or two a day to Ithaca, but that's OK http://www.flyertalk.com/forum/smile.gif)

Another interesting twist to this story:
http://public.wsj.com/sn/y/SB979316712102389226.html

Some industry observers are skeptical of regulators' ability to effectively open these markets, but the commission says it has learned from mistakes. "United will have to make slots available, and slots at interesting times," said Amelia Torres, a commission spokeswoman. "If there's a company -- and we understand that there is one -- willing to fly all or part of those routes, then United has an obligation to surrender slots to that company or another company that would also provide effective competition."

Who else wants to fly FRA-PIT,CLT,PHL and MUC-PHL????

"want" is probably too strong a word but maybe if UA cuts a deal with their friends at LH they would operate the service jointly/codeshare.

just a guess but likely in view of the EU's protectionist policies http://www.flyertalk.com/forum/wink.gif