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Old Jan 23, 05, 9:16 am   #1
 
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Wedding Bells?

Over on the UAL Board people are discussing that airlines emergence from bankruptcy in Fall. If both airlines are out of bankruptcy are we going to see merger talks part II? I'm sure this time the Feds would bless the marriage but we it be good for US? Is their management better than ours or would it be case of the minnow swallowing the whale with the US management team remaining in place. Don't laugh, I've seen this before. When the Burlington Northern Railway merged with the Santa Fe, more execs from the Santa Fe stayed even though it was the smaller road.
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Old Jan 23, 05, 9:44 am   #2
 
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Reading sassaman's post made me think of the old 5th Dimension song "Wedding Bell Blues".
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Last edited by jimcfsus; Jan 23, 05 at 9:44 am.. Reason: grammar
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Old Jan 23, 05, 10:18 am   #3
 
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Quote:
Originally Posted by sassamanlaw
Over on the UAL Board people are discussing that airlines emergence from bankruptcy in Fall. If both airlines are out of bankruptcy are we going to see merger talks part II? I'm sure this time the Feds would bless the marriage but we it be good for US? Is their management better than ours or would it be case of the minnow swallowing the whale with the US management team remaining in place. Don't laugh, I've seen this before. When the Burlington Northern Railway merged with the Santa Fe, more execs from the Santa Fe stayed even though it was the smaller road.
I think it would be a beautiful wedding. UA is not the largest airline anymore as they were when they tried this last time. The Feds let AA buy TW to become the largest. Would see no reason why they wouldn't let UA buy US. Everyone knows that there is too much capacity. This way they could great a completely national legacy carrier (with a slightly better route system than AA except in the south-central tier of course) and still cut the excess to create a profitable company.

For US FF though it's could be a mixed blessing. There are some advantage to the UA program, such as SWU's, CR-1's for 1Ks, exit-row blocking for UA 1P's and Economy Plus. But we would loose the unlimited upgrades and the 50% bonus drops to 25%..
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Old Jan 23, 05, 11:32 am   #4
 
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I think if they did merge, they'd probably maintain pretty separate entities. Kinda like what Air France and KLM are doing now.
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Old Jan 23, 05, 12:33 pm   #5
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A big problem with the last merger was union coordination. I doubt it will be any easier this time around. The unionzed work force of TWA is still reeling over that merger.
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Old Jan 23, 05, 2:49 pm   #6
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Any two legacy carriers will be more than happy to merge RIGHT NOW if a financier will grant, without expectation of repayment, the $2,000,000,000+ necessary to fully integrate the airlines.

In other words, there probably won't be any wedding bells heard among legacy carriers anytime soon.
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Old Jan 23, 05, 3:10 pm   #7
 
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Well I for one hope it does not happen. I have never once had a good experience with UAL. And with the huge debt that both UAL and US Airways is in, I really donīt think we will see a merger anytime soon at all. And I hope never.
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Old Jan 23, 05, 3:11 pm   #8
 
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Everyone does not know that there is "too much capacity". That is a crock being perpetrated by certain airline "executives" who are desperately clinging to the old ways and parroted by utterly clueless "journalists", politicians and union leaders.

There is an excess over priced legacy gouge-o-matic fares and grossly inefficient operations.

There is a shortage of capacity. Demand is strong and growing. Load factors are darned near 80% -- that's a ridiculous number and a major contributing factor to operation snafus such as the Christmas mess.

Any pullback by (or failure of) a legacy airline will be immediately filled by all of the others and by the LCCs. All that will happen is that expensive seats will be replaced by less expensive seats. This has finally sunk in at Delta -- one of the previous champions of "over capacity" and will inevitably sink in at any surviving legacy airline. It is somewhat questionable if US Airways understands this as BloFares are still present in all too many markets... (Although Mr Lakefield did quote me (without attribution of course) on the "excess of over-priced fares" bit a few months ago!)

Last edited by TomBascom; Jan 23, 05 at 3:15 pm..
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Old Jan 23, 05, 3:13 pm   #9
 
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BTW -- I think merging with UA would be a huge mistake.

I'd rather see NW or HP or Virgin or even AA.
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Old Jan 23, 05, 4:46 pm   #10
 
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Virgin I'd say ok. But ever actually flown HP or NW (not mentioning
the unlikelihood of the latter)?
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Old Jan 23, 05, 6:23 pm   #11
 
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It would be neat to see US and AS merge. That way AS has the west coast routes while US has the east coast routes.
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Old Jan 23, 05, 8:23 pm   #12
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US did that already and botched it up big time. Read up on how great an airline PSA was before the early 90's when US then-management got it's grubby hands on it and ruined what it was.
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Old Jan 23, 05, 8:50 pm   #13
 
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Quote:
Originally Posted by TomBascom
Everyone does not know that there is "too much capacity". That is a crock being perpetrated by certain airline "executives" who are desperately clinging to the old ways and parroted by utterly clueless "journalists", politicians and union leaders.

There is an excess over priced legacy gouge-o-matic fares and grossly inefficient operations.

There is a shortage of capacity. Demand is strong and growing. Load factors are darned near 80% -- that's a ridiculous number and a major contributing factor to operation snafus such as the Christmas mess.

Any pullback by (or failure of) a legacy airline will be immediately filled by all of the others and by the LCCs. All that will happen is that expensive seats will be replaced by less expensive seats. This has finally sunk in at Delta -- one of the previous champions of "over capacity" and will inevitably sink in at any surviving legacy airline. It is somewhat questionable if US Airways understands this as BloFares are still present in all too many markets... (Although Mr Lakefield did quote me (without attribution of course) on the "excess of over-priced fares" bit a few months ago!)
Well it's been pretty obvious that 70-80% loads are unprofitable for most carriers.
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Old Jan 23, 05, 10:37 pm   #14
 
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Quote:
Originally Posted by PHL
US did that already and botched it up big time. Read up on how great an airline PSA was before the early 90's when US then-management got it's grubby hands on it and ruined what it was.

This is not the same management team from the 90īs. Everyone from that team is gone
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Old Jan 24, 05, 12:06 am   #15
 
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Quote:
Originally Posted by US AIRWAYS FAN
This is not the same management team from the 90īs. Everyone from that team is gone
I agree. Not to mention, I would hope any management team could learn from previous lessons.
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