Originally Posted by
FWAAA
Most of the record-setting $537 million net profit at US will be consumed bringing the US employees up to AA's payrates. Parker has promised improvements to the AA pilots and FAs and presumably will buy the other workgroups' approval as well, threatening the cost-cutting that current AA management fought so hard to accomplish over the past year.
The bottom line is that the combined entity is unlikely to be profitable given the large payraises promised by US management. Perhaps AA's creditors (which include AA employees) would be better served by emerging independently?
If your arm chair analysis was so cut and dried it unlikely there would still be an ongoing merger discussion.
Supposedly a merger would yield cost savings and enhanced revenue that would make your back of the napkin analysis irrelevant.
Of course Horton said they could boost revenue significantly as a stand alone despite limited industry wide growth.
Everyone presents numbers that back there case, duh.