Apr 6, 2016, 11:48 pm
Alaska nears $2B bid for Virgin America
Apr 3, 2016, 8:45 pm
#106
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Posts: 3,790
I think AS would gut a lot of the VX service out of LAX. Why would they still need to fly to places like LAS, MCO, FLL, or IAD? Or even JFK? VX is only making money when oil is trading below $40 a barrel. So I doubt that AS would want to incorporate that into their business model. AS is better off focusing on SFO and building up operations there. Moreover, shedding a lot of the VX routes from LAX allows then to also get rid of more 320s while they still have a good lease/resale value. And probably not have to have split terminal operations (T3/T6). Plus, they can still put their AS code on those same AA flights out of LAX.
B6 and VX is the only matchup that makes sense.
Apr 3, 2016, 8:49 pm
#107
Moderator: Southwest Airlines, Capital One
Join Date: Sep 1999
Location: California
Programs: WN Companion Pass, A-list preferred, Hyatt Globalist; United Club Lietime (sic) Member
Posts: 21,624
Apr 3, 2016, 8:54 pm
#108
Join Date: Nov 2008
Location: Snohomish, WA
Programs: AS MVP Gold, HHonors Diamond
Posts: 2,793
Apr 3, 2016, 8:58 pm
#109
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Join Date: Aug 2007
Location: SEA, but up and down the coast a lot
Programs: Oceanic Airlines Gold Elite
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Or like how WN has large operations set up at LAS, OAK, LAX, PHX, SJC, SNA and SAN? I hear they're doing just TERRIBLE these days...
Apr 3, 2016, 9:07 pm
#110
Join Date: Aug 2006
Location: SJC
Programs: DL PM MM, Marriott Titanium
Posts: 3,276
Or UA with a huge operation at SFO and a sizeable operation at LAX. IIRC, SFO is one of their best performing hubs.
Apr 3, 2016, 9:24 pm
#111
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Location: SEA, FLL, Martha’s Vineyard
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In all seriousness, what are peoples prediction on this stock tomorrow? I'm thinking about picking some up as it will likely go to 120-150 a share I think if the deal goes over smooth and everything works out as it should.
Apr 3, 2016, 9:30 pm
#112
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Location: Bay Area, CA
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This makes huge financial sense for AS. If AS doesn't do it, B6 will. And B6 becomes a stronger national player, while AS remains with its SEA hub that is completely irrelevant for most traffic flows for the country.
Apr 3, 2016, 9:33 pm
#113
Join Date: May 2011
Posts: 5,814
+1. Although that would be a tricky relationship because it would also imply that there would be a relationship with VA and VS (potentially causing issues with existing AS partners). This doesn't even include the licensing cost that someone mentioned above.
Apr 3, 2016, 9:38 pm
#114
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Location: SEA, but up and down the coast a lot
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Apr 3, 2016, 9:39 pm
#115
Moderator: Alaska Mileage Plan
Join Date: Feb 2005
Posts: 12,318
Not recommended. VA should open close to the buyout price. My guess is that ALK will open down.
Apr 3, 2016, 9:52 pm
#116
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Location: SEA, FLL, Martha’s Vineyard
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No I'm talking about AS's stock, which is currently at about $83. It has done nothing but gone up in the last decade.
Apr 3, 2016, 9:56 pm
#117
Join Date: May 2012
Location: HNL
Programs: AS MVPG, HA Plat
Posts: 1,268
If I felt like putting my money where my mouth is, I'd think about buying HA in a few weeks, after the impact of this transaction has been priced into their stock and before they're the next target.
Apr 3, 2016, 10:07 pm
#118
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Location: SEA, FLL, Martha’s Vineyard
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People keep talking about HA, but I don't see where or how HA has anything to do with this scenario?
Apr 3, 2016, 11:10 pm
#119
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I'm guessing it will go down because AS overpaid. JMHO.
Apr 3, 2016, 11:24 pm
#120
Join Date: May 2012
Location: HNL
Programs: AS MVPG, HA Plat
Posts: 1,268
With this deal, AS cuts HA off from one of its two sources of mainland feed (the other is JetBlue, and both are half-assed at this point), and adding HA to the mix would further strengthen the combined AS-VX on the West Coast and in Hawaii plus add a fleet of widebodies and a developing trans-Pac network. It would be an operational and management stretch, but if they pulled it off they'd be significantly stronger against DL and (maybe especially) UA. And yes, it would be splendid for us HI-based AS flyers, but I don't think it's purely wishful thinking to imagine that an AS that's willing to pay through the nose for VX may be looking at it as a step in a larger strategic vision.