Originally Posted by skyfly

As a HP employee I will throw my 2 cents by stating I really cannot figure out why HP would ever get into bed with US especially considering their huge debt load (US alone owes the gov. over 700 million in loans, while HP owes over 300 million, the 2 combined would be over 1 billion). US for some time now has been on life support while bleeding red financially. My fear is that if a merger goes through, USAIR employees will merge their "baggage" into the new merged company. The moral with US employees must be at all time low considering that most of their employees have taken pay cuts, having their pensions stripped away, and paying more for health care coverage; not to mention their image took a beating during the Christmas/New Year holiday rush with luggage issues. In order for a merged US to be successful, US need to get their operational and labor cost at HP level. I think Doug Parker will not allow the merger proceed until US can get this under control. I just can't imagine US try to ask their employees more wage concessions so they can match labor and operational cost with HP. The bottom line is if a new lowcost USAIR is to be competive especially with WN along with Jetblue and Airtran, getting their operational cost down to HP level will be the cornerstone to making US successful.

I certainly hope Doug Parker meant his word when he said would not take a risk on merger if did not benefit HP as a whole including shareholders and employees. Doug has said their is too much capacity and low yields and there needs to be a shakeup by either consolidation or a couple of airlines going out of business all together. I hope he knows what he is saying. 5 years ago, HP was running a ****ty airline, but HP and its employees have really put 110% effort into turning the company around. No, we are not perfect and there is always room for improvement. But HP is doing something right if we were the only few carriers to turn a profit during 1st qtr. The rumor mill is that Doug Parker would most likely stay on as CEO. Doug has a favorable relationship with most employees. I heard (through rumor mill) that a new merged US would retain headquarters in PHX (Tempe) due to lower cost than Arlington. I am sure the state of Arizona or City of PHX or Tempe may give incentive for staying in AZ. I think the big issue with employees is the intergration with seniority especially with crewmembers. For ground employees (gate and ticket agents, ramp workers, reservations) I do not think that should be much of an issue. USair is mostly on the east while HP on west. Some of HP field stations opertations on the east coast are contracted with CO. While US field stations on the west is few so intergrating those employees should not be much trouble.

I thought perhaps US/HP should start out as codeshare partners rather than merger. CO/NW/DL codeshare arrangements seems to be working for them without the headaches of a merger. However in reality it would not benefit US since they already have UA with a larger network.

By the way, senior management at HP is keeping a tight lid on any merger deal. They do want to have something announced by next week May 16 or 17th at the HP meeting so we'll see.