Any update on when the revised flight schedules will be loaded?
Info provided to travel agencies indicated new flight schedules would be available by the end of this past week, but that obviously has not occurred. Is YX waiting to see what happens with the unions, before committing to the changes?
I'm afraid we will hear chapter 11 bankruptcy filing tonight or tomorrow morning before we hear about schedule changes.
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Can anyone say Hoax-sema?
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Quote:
Originally Posted by hazelrah
TPG could learn to more closely consider its investment strategies and risks.
How do you know TPG hasn't carefully considered the risks associated with acquiring a majority stake in Midwest?
The huge spike in oil since January has certainly complicated Midwest's business plan (and the plans for all other airlines for that matter). However, TPG has an excellent track record in the airline industry. For example, Continental Airlines was in terrible shape when TPG invested in the company. Despite all of the problems, TPG turned Continental around. Today, they are probably one of the best run legacy airlines in the United States. TPG also did wonders with America West.
TPG knows what its doing. I recognize that the airlines are in unchartered waters at the moment and things will almost certainly get worse before they get better. However, I seriously doubt that TPG is going to let $250 million of its own money go down the toliet after just six short months. If they honestly believe Midwest has long term potential, they'll inject additional cash into the company.
__________________ If you don't know where you are going, you might end up someplace else.
Look, we get it. Northwest does not give a fig about Midwest; NW only bought Midwest to block Air Tran - mission accomplished. Hopefully no one on this board has any delusions about any other motivation on NW's part.
Considering how often Northwest is brought up by several posters on this board, I think it's rather apparent that not everybody on this board understands and agrees that Northwest's sole motivation was to block AirTran and that NW did not come in to control Midwest.
The reason I brought up (again) the NW motivation was because another poster confused my comment about preserving the status quo...NW's motivation but not TPG's. It was a point of clarification.
Quote:
Originally Posted by hazelrah
TPG bought Midwest with the idea that they would make some money.
And how would TPG have done that? How has TPG done this in the past at other airlines? By investing significantly more money than they paid to restructure the company. Time and time again they have sold their airline investments for a profit...but only after investing in the turnaround of the company. That has each and every time required more than the initial investment, and there's no reason to think it wouldn't require additional investment in this case as well.
Quote:
Originally Posted by hazelrah
What a joke, TPG/NW invested half a billion dollars, are they supposed to invest more?
No, the joke would be if anyone thought that Midwest would somehow be worth more down the road to TPG without them spending more on a turnaround. TPG was not stupid enough to think that turning Midwest into an entity worth more than they paid would not require additional investment.
Quote:
Originally Posted by hazelrah
The plan and the objective, due in no small part to $140.00 oil has changed.
What indications have you to prove the notion that the core goal of TPG's plan...turning Midwest around so it is later a more valuable asset....has changed? Or even support this?
Undoubtedly the climbing price of oil has changed the landscape, the details, and the difficulty of the task. Could TPG decide to write off the Midwest investment? Certainly. But there hasn't been any sign of that whatsoever at this point. Has there?
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Read my lips. This is a financial play for TPG. They covered NW by stepping up as the "majority owner". In all likelihood, had NW tried to buy the whole thing, it would have gotten tied up in the mandatory HSR (Hart, Scott, Rodino anti trust requirement for deals of that size) review, which would have cleared the way for AirTran. They probably have a "put" to Northwest, at a number that gives them a nice profit. Such arrangements are common, and allow the partner to do so (put the stock for cash) as soon as the entrerprise is at a point where a permissable acquisition by the other partner can be done. If one were given to embrace the theories of Machiavelli, just letting YX croak is faster, and cleaner. It might also explain why David Siegel, a former CEO of USAirways, currently running another TPG company (Gate Gourmet), is on the Midwest board, looking over Hoeksema 's (however you spell it) shoulder and watching Bonderman's (TPG chief) money.
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Quote:
Originally Posted by mke9499
Any update on when the revised flight schedules will be loaded?
Info provided to travel agencies indicated new flight schedules would be available by the end of this past week, but that obviously has not occurred. Is YX waiting to see what happens with the unions, before committing to the changes?
The new schedules are supposed to be available by Wednesday. Rumors from reliable sources indicate that Midwest will be keeping several MD80s in service for awhile. There's really no reason to keep only a few MD80s around unless Midwest has "other fleet options" available and they'd like to keep a presence in select markets for the time being (i.e. MKE-LAX) rather than turn all of that displaced traffic over to competitors.
__________________ If you don't know where you are going, you might end up someplace else.
The new schedules are supposed to be available by Wednesday. Rumors from reliable sources indicate that Midwest will be keeping several MD80s in service for awhile. There's really no reason to keep only a few MD80s around unless Midwest has "other fleet options" available and they'd like to keep a presence in select markets for the time being (i.e. MKE-LAX) rather than turn all of that displaced traffic over to competitors.
I also wonder if they have a contract obligation until November for the Obama campaign. If they pay the true cost of flying the MD80 around the country, then it would make sense to keep flying it.
I also wonder if they have a contract obligation until November for the Obama campaign. If they pay the true cost of flying the MD80 around the country, then it would make sense to keep flying it.
There's free advertising every time there is a shot of Obama boarding his charter.
Don't forget the Brewers and Royals charters. This is good, guaranteed business.
The new schedules are supposed to be available by Wednesday. Rumors from reliable sources indicate that Midwest will be keeping several MD80s in service for awhile. There's really no reason to keep only a few MD80s around unless Midwest has "other fleet options" available and they'd like to keep a presence in select markets for the time being (i.e. MKE-LAX) rather than turn all of that displaced traffic over to competitors.
Midwest's Mike Brophy called in live to Jeff Wagner's show today on WTMJ Radio and offered the following:
Midwest wants to avoid filing for Chapter 11 and admits the process will be painful
Talks are still in process with the unions
Part of the restructuring process is to focus on business destinations, which will not make their leisure traveler customer happy
Revised flight schedules will not be released until the next 1-1/2 weeks, or so, for competitive reasons
Customers who booked YX flights that will be eliminated will be reaccommodated on other carriers or issued a refund
I realize that Brophy is new to this industry, but he really needs to work on his delivery; it's not an easy job, but it is his job.
The interview is on Jeff Wagner's podcast, about halfway through hour one today.
I realize that Brophy is new to this industry, but he really needs to work on his delivery; it's not an easy job, but it is his job.
Here's what I don't get. Why do they keep coming out and saying that they're "going" to be making cuts, with more details to come in the future?
From a PR standpoint, why would you have repeated announcements that bad things are in the works? You'd think they could have come out with an all-encompassing announcement saying that they're cutting 1,200 jobs, eliminating x routes and are parking the MD 80s.
Am I looking at this too simplistically? I just think when you have bad news, you should get your ducks in a row behind the scenes, come out with the bad news and then move on. Better than having bad press on a weekly basis.
Here's what I don't get. Why do they keep coming out and saying that they're "going" to be making cuts, with more details to come in the future?
From a PR standpoint, why would you have repeated announcements that bad things are in the works? You'd think they could have come out with an all-encompassing announcement saying that they're cutting 1,200 jobs, eliminating x routes and are parking the MD 80s.
Am I looking at this too simplistically? I just think when you have bad news, you should get your ducks in a row behind the scenes, come out with the bad news and then move on. Better than having bad press on a weekly basis.
My thoughts, exactly. Is Brophy being sent out by management to the front lines to face the firing power? If so, he has not been equipped with the proper armor to defend the company, with some discretion.
He is divulging information in an improper manner. You would think they could put a slightly better spin on things, albeit a very difficult situation. Maybe they need some help from the outside to keep a better face during this whole unfortunate process.
My thoughts, exactly. Is Brophy being sent out by management to the front lines to face the firing power? If so, he has not been equipped with the proper armor to defend the company, with some discretion.
He is divulging information in an improper manner. You would think they could put a slightly better spin on things, albeit it would be difficult. Maybe they need some help from the outside to keep a better face during this whole unfortunate process.
He probably wishes right now that he didn't leave Aurora Health Care.
The new schedules are supposed to be available by Wednesday. Rumors from reliable sources indicate that Midwest will be keeping several MD80s in service for awhile. There's really no reason to keep only a few MD80s around unless Midwest has "other fleet options" available and they'd like to keep a presence in select markets for the time being (i.e. MKE-LAX) rather than turn all of that displaced traffic over to competitors.
This seems extremely unlikely given that they are planning on laying off 40% of the workforce. When you are close to going under, you don't worry about maintaining "market presence" until "other fleet options" become available. Instead, you cut your lowest performing routes and hope for the best.
I think two things are forcing Midwest's hand in public disclosure:
(1) The pilots union (and the f/a union to a smaller extent) are taking their negotiations public, and that releases pending and non-finalized information to the ravenous media before Midwest is ready to go public. Midwest has to respond somehow, but the reponses end up guarded, awkward, tentative, and incomplete.
If the word from inside that the M80's won't all be parked quite so fast as predicted is true, they're going to look a little foolish at best.
(2) State requirements for advance notice of scheduled layoffs mean that if they plan widespread cuts, they have to go public with the information. 60 days of lead time is required, and that puts them at 9/12 as of today.
I definitely do not think that Brophy and Midwest in general is doing a good job with the media, but I do think it's a difficult line to walk at the moment.
