US Airways Dividend Miles (Pre-FlightFund Merger) - Merger Days Away?

New (5/12 pm) article on philly.com:

"US Airways and America West Airlines appear to be just days away from revealing plans for combining the companies into a single operation, a move with far-reaching implications for Philadelphia travelers, industry analysts say."

http://www.philly.com/mld/philly/business/11631300.htm

Look like months !

I was having a conversation with another FTer last night and we got arround to speculating when it will actually occur. I'm willing to go out on a limb and make a prediction as to when an agreement will be announced

I predict that on Sunday, May 15, 2005 the merger agreement will be announced.

I'm making this prediction based on a couple of things:

Stock market will be closed
HP's shareholder's meeting is on Tuesday (In case anyone is interested they will be are webcasting the audio. It starts 9:30AM Mountain Time)
Sunday is usually the slowest day for business
You don't ask a BK judge to set aside money to help retain managers in case of a merger, unless you're pretty sure its going to happen.


If I'm right well you heard it on FT first, if I'm wrong good luck to both US and HP management teams as they try and figure this things out.

I'm seconding schwab's prediction. IF its gonna happen, that's when. Only thing that could delay it are last minute hitches that they dont think can be resolved in time.

But basically if you dont hear by then, it gets increasingly unlikely as Monday (and Tuesday!) roll around. Then, after Tuesday, all bets are off because if enough hitches are identified, they can just not try to push to have it for the meeting (although I am sure that is the preference).

With one of the major obstacles against the merger being employee seniority issues, how are they going to handle that? Over on the HP boards, it seems like a lot of HP's employees are really concerned about his given most US employees have higher seniority. This probably won't be an issue if US were the "acquirer" and the healthy carrier, but it's the other way around. It will be interesting how this will be handled when/if the merger is announced.

By the way, will the "new" carrier have automatic Star membership since the new carrier will most likely remain US Airways?

LAX

With one of the major obstacles against the merger being employee seniority issues, how are they going to handle that? Over on the HP boards, it seems like a lot of HP's employees are really concerned about his given most US employees have higher seniority. This probably won't be an issue if US were the "acquirer" and the healthy carrier, but it's the other way around. It will be interesting how this will be handled when/if the merger is announced.

By the way, will the "new" carrier have automatic Star membership since the new carrier will most likely remain US Airways?

LAX


Not sure about some of the other groups, but according to http://www.post-gazette.com/pg/05133/503793.stm

ALPA (represents US & HP pilots) has a process in place to deal with issues of seniority.

The AFA is used by both carriers for the FAs and I did some digging and according the Association of Flight Attendants-CWA Constitution and ByLaws (http://www.afanet.org/cb/default.asp?id=61) in Section 10 there is a defined procedure for dealing with how to handle merger and resolve seniority issues when two AFA members merge.

I think the Wall Street Journal reported a couple of weeks ago, the merged entity would keep the USAirways name and remain in *

ALPA (represents US & HP pilots) has a process in place to deal with issues of seniority.

The AFA is used by both carriers for the FAs and I did some digging and according the Association of Flight Attendants-CWA Constitution and ByLaws (http://www.afanet.org/cb/default.asp?id=61) in Section 10 there is a defined procedure for dealing with how to handle merger and resolve seniority issues when two AFA members merge. *



ALPA's merger policy was changed a few years ago. It used to be date of hire. Now they have four points to consider--so it might not be so easy, fair and equitable to all from different vantage points:

1)Preserve jobs.
2) Avoid windfalls to either group.
3)Maintain or improve premerger pay and workrules.
4)Minimize detrimental changes to career expectations.

AFA is date of hire.

US Airways, America West Move Towards Merger http://news.airwise.com/story/view/1116027044.html

A few days back I predicted it would be this weekend, and I stand by that prediction. If we're all thinking the same, it must be right ;)

ALPA (represents US & HP pilots) has a process in place to deal with issues of seniority.

The AFA is used by both carriers for the FAs and I did some digging and according the Association of Flight Attendants-CWA Constitution and ByLaws (http://www.afanet.org/cb/default.asp?id=61) in Section 10 there is a defined procedure for dealing with how to handle merger and resolve seniority issues when two AFA members merge.


having a process in place doesn't mean there's no dispute, in fact quite the contrary. the AFA policy says that systemwide seniority rights belong to whoever was hired first (by either company). In a merger like HP/US, the US staff averages much longer tenure and would have dominant bidding rights under this policy. In effect, to buy US and merge operations, HP would be royally screwing over its own FA's.

having a process in place doesn't mean there's no dispute, in fact quite the contrary. the AFA policy says that systemwide seniority rights belong to whoever was hired first (by either company). In a merger like HP/US, the US staff averages much longer tenure and would have dominant bidding rights under this policy. In effect, to buy US and merge operations, HP would be royally screwing over its own FA's.

However, given the fact that most US FA's are based in the east and most HP FA's are based in the west - a lot of short-haul routes are likely going to be bid on by largely the original carrier's FA's thus minimizing conflict somewhat.

However, given the fact that most US FA's are based in the east and most HP FA's are based in the west - a lot of short-haul routes are likely going to be bid on by largely the original carrier's FA's thus minimizing conflict somewhat.


The fly in the ointment is a relatively signficant number of former PSA FA's who still live in Cali and commute to the east coast. Their dates of hire are prior to the founding of HP and would bid the prime HP routes if given the opportunity.

I'll probably end up eating my words, but I still think somebody else may come in. If this thing moves forward, it looks like the US name, but probably a lot of HP management, with perhaps HQ moving to Phoenix. Rebranding in the west will be a chore, since US has no visibility now. And then, there is overcapacity. A temporarily revitalized US/HP will be met with as much enthusiasm as the plague, by the other major carriers. You can expect an agressive response, which will really lower fares. This is getting interesting.

The fly in the ointment is a relatively signficant number of former PSA FA's who still live in Cali and commute to the east coast. Their dates of hire are prior to the founding of HP and would bid the prime HP routes if given the opportunity.

They could do similar to what American/TWA did at first (before they got rid of all the TWA folks) and lock seniority within a base or realm of operations. Perhaps a compromise would have employees at, say, Phoenix would keep their seniority as long as they remained at Phoenix, and those choosing to swap bases would be figured it at some ratio that would give them similar bidding rights.

Good point on former PSA folks. For a company that got merged in, and disappeared, there are a lot of senior FA's (formerly based in LA until the domicile closed). I observed at one time that many of the F 100 pilots also came from there (now presumably dispersed among other types), not to mention ground staff in the west coast destinations, from San Diego on up to Seattle. And let's not forget PSA's contribution to senior managment, the ever popular Al Crellin.

They could do similar to what American/TWA did at first (before they got rid of all the TWA folks) and lock seniority within a base or realm of operations. Perhaps a compromise would have employees at, say, Phoenix would keep their seniority as long as they remained at Phoenix, and those choosing to swap bases would be figured it at some ratio that would give them similar bidding rights.

nope, that's just it, they cannot choose to do that or any other "compromise"-- seniority by date of hire is AFA national's final infalliable word; if the MEC's tried to diobey it they'd be open to lawsuits from their members for not following their own rules... AA's union APFA could do what it did because it is not bound by the AFA policy. They didn't really compromise much, either, or some of those folks would not be currently on furlough.