View Poll Results: My opinion of the announced AA - US merger is:
This is the best of all possible worlds; great idea!
33
3.93%
This portends a stronger airline, with some changes for all
192
22.88%
I am neutral - pros and cons for all
199
23.72%
I think this is a somewhat bad idea with some real challenges
226
26.94%
I am completely opposed to this merger; terrible idea!
189
22.53%
Voters: 839. You may not vote on this poll
AA - US Merger Agreement / Announcement / DOJ Action Discussion (consolidated)
Aug 14, 2013, 7:24 am
#1801
Join Date: Dec 2010
Location: Michigan
Programs: AA EXP(4mm), DL Gold, UA Gold (1mm), HH Diamond, Bonvoy Amb(l/t Titanium). Former EA/PA elite
Posts: 994
That said, I fail to see how they will allow this to go to trial. That would likely take well over a year, and even then the outcome would be uncertain. Would/could be a huge mess. And time is an issue. With DL being back on track after swallowing NW, and UA/CO starting to get untangled, AA has to get back in the game w/o letting several years go by.
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Aug 14, 2013, 7:45 am
#1802
Join Date: Dec 2004
Posts: 7,911
Originally Posted by rrgg
Are you saying Holder will be thrown under the bus, because he addressed this?
“Airline travel is vital to millions of American consumers who fly regularly for either business or pleasure,” said Attorney General Eric Holder. “By challenging this merger, the Department of Justice is saying that the American people deserve better. This transaction would result in consumers paying the price – in higher airfares, higher fees and fewer choices. Today’s action proves our determination to fight for the best interests of consumers by ensuring robust competition in the marketplace.”
“Airline travel is vital to millions of American consumers who fly regularly for either business or pleasure,” said Attorney General Eric Holder. “By challenging this merger, the Department of Justice is saying that the American people deserve better. This transaction would result in consumers paying the price – in higher airfares, higher fees and fewer choices. Today’s action proves our determination to fight for the best interests of consumers by ensuring robust competition in the marketplace.”
I also believe it was Holder who made some bold statements a few months back about press leaks of classified information, quickly reversed course when they fought back.
Last edited by rrgg; Aug 14, 2013 at 8:08 am
Aug 14, 2013, 7:49 am
#1803
Join Date: Oct 2012
Programs: AA: EXP/5.2mm
Posts: 251
Certainly not. Holder would have been briefed along the way. In theory he could have vetoed the filing of the lawsuit if he had chosen to do so, but that is a difficult thing to do in the face of strong opinions against the merger within his Antitrust Division.
Aug 14, 2013, 7:54 am
#1804
Join Date: Nov 2009
Location: Austin
Programs: AA EXP +2MM- LT PLT! HH Diamond
Posts: 6,092
Well, let's not forget that 7 State AGs joined in on this lawsuit, including the ones from TX and AZ, which should say something and not make it just a focus on DCA slots. I doubt they would care less.
Aug 14, 2013, 8:08 am
#1805
Join Date: Jun 2012
Location: Boston, MA
Programs: AMEX Platinum, Marriott Platinum, Hilton, Hyatt
Posts: 117
The flight I take most often throughout the year is the BOS-DCA shuttle on US Airways. From 2006 - 2010, flights were consistently above $300, and to get it lower, I had to finagle my schedule. I remember one specific example in March of 2009, that every flight from BOS-DCA from then until July was $450 and up. As you can imagine, I was pretty upset. I ended up taking the train, partially out of spite.
While I do like the prospects of a larger and healthier airline, I do wonder if the flights will go back to the examples I quoted above. Since JetBlue's entry into DCA, I haven't paid more than $185 for a round trip flight.
Aug 14, 2013, 8:17 am
#1806
FlyerTalk Evangelist
Join Date: Mar 2005
Location: 60137
Posts: 10,499
Horton is not speaking publicly because he's speaking privately to his much maligned, overpaid investment bankers et al. (sarc)
Plan B, C, and D will unfold soon.
Magic 8 ball says: If there's a way for mAAnagement to exit B/K with a mega personal payday, they'll execute it.
Plan B, C, and D will unfold soon.
Magic 8 ball says: If there's a way for mAAnagement to exit B/K with a mega personal payday, they'll execute it.
Aug 14, 2013, 8:22 am
#1808
Moderator: American AAdvantage, Signatures
Join Date: Jan 2008
Location: London, England
Programs: UA 1K, Hilton Diamond, IHG Diamond Ambassador, National Exec, AA EXP Emeritus
Posts: 9,765
Aug 14, 2013, 8:28 am
#1809
Join Date: Mar 2009
Location: LAX
Posts: 3,267
Wow...
http://www.latimes.com/business/la-f...0,660087.story
The government's case included internal communications among executives at US Airways, who complained about passenger demands to improve services and suggested that a blockbuster merger would ease that pressure.
In a 2011 email exchange, one senior executive vented about the need to install in-flight wireless Internet. He wrote: "[N]ext it will be more legroom. Then industry standard labor contracts. Then better wines. Then the ability to book on Facebook."
Parker, the CEO, wrote back: "Easy now. Consolidation will help stop much of the stupid stuff but inflight Internet is not one of them."
In a 2011 email exchange, one senior executive vented about the need to install in-flight wireless Internet. He wrote: "[N]ext it will be more legroom. Then industry standard labor contracts. Then better wines. Then the ability to book on Facebook."
Parker, the CEO, wrote back: "Easy now. Consolidation will help stop much of the stupid stuff but inflight Internet is not one of them."
Aug 14, 2013, 8:30 am
#1810
Join Date: Jun 2009
Location: WAS
Programs: AA EXP, BA Bronze, TK Elite, Hyatt Diamond, Hilton Gold, Fairmont Premiere, IHG Ambas
Posts: 180
Analyzing this situation requires certain facts and circumstances to not be easily dismissed. If it was so clear that either AA or US would be heading into liquidation without the merger, DOJ would not block the merger because antitrust laws recognize a "failing firm" defense to mergers wherein an otherwise anticompetitve merger is allowed if the likely alternative is the financial failure of one of the parties to the merger. The defense has a high burden to meet and I have not seen, and do not expect to hear, anything of the sort from either AA and USAirways. AA has demonstrated that it can continue as a going concern, and as far as I know US Airways is operating just fine, even if on a knife's edge.
Leaving the legal arena, I think there is too much weight/bias being given towards UA and DL successfully executing their domination plans and squeezing out independent US and AA. They are both in a strong position to do so with their size, but the last 16-17 months of the UA show should remind everyone that size alone will not deliver results, it helps a lot, but you must still execute. One or two big mistakes by either UA and DL and AA could thrive. Whereas DOJ sees the merger creating an instantneous MAD situation that results in everyone retreating to their corners and holding what they have at an immediate cost to the consumer. Independent AA and US will have to fight to stay in the game and that is considered healthy from a competition perspective and to the consumer.
Leaving the legal arena, I think there is too much weight/bias being given towards UA and DL successfully executing their domination plans and squeezing out independent US and AA. They are both in a strong position to do so with their size, but the last 16-17 months of the UA show should remind everyone that size alone will not deliver results, it helps a lot, but you must still execute. One or two big mistakes by either UA and DL and AA could thrive. Whereas DOJ sees the merger creating an instantneous MAD situation that results in everyone retreating to their corners and holding what they have at an immediate cost to the consumer. Independent AA and US will have to fight to stay in the game and that is considered healthy from a competition perspective and to the consumer.
Aug 14, 2013, 8:46 am
#1811
Join Date: Apr 2001
Posts: 1,473
Not me!
It's clear from the DOJ documentation (and past experience) that Dougie wanted to drag AA to gutter level service while hiking prices--essentially creating new found pricing power that does little for the consumer in terms of competition.
It's clear from the DOJ documentation (and past experience) that Dougie wanted to drag AA to gutter level service while hiking prices--essentially creating new found pricing power that does little for the consumer in terms of competition.
Aug 14, 2013, 8:52 am
#1812
Join Date: Dec 2004
Location: MIA/FLL
Programs: AA-EXP 2MM; Priority Club-Platinum
Posts: 270
Huge game changer
US chases AA. Unions tip the balance based on Doug's generosity. AA succumbs. DOJ says no.
Fight fruitless. No negotiations can remove legal assertions. Timing off. BK can't wait years. All dominant hub states (ex NC) say no to both home-town airlines. Doug and unions lose. AA management wins.
So now where do the unions stand? They are emasculated. No merger, bankrupt airline, voided contracts renegotiated. How can they win?
With no union leverage, they can follow Eastern (self-destruct) or agree to a really "new AA." AA's profits and prior game plan seem plausible, if not probable. There is a real niche for a well-executed legacy airline business. Not the largest. Not dominant in Asia and Europe. But well executed.
Fight fruitless. No negotiations can remove legal assertions. Timing off. BK can't wait years. All dominant hub states (ex NC) say no to both home-town airlines. Doug and unions lose. AA management wins.
So now where do the unions stand? They are emasculated. No merger, bankrupt airline, voided contracts renegotiated. How can they win?
With no union leverage, they can follow Eastern (self-destruct) or agree to a really "new AA." AA's profits and prior game plan seem plausible, if not probable. There is a real niche for a well-executed legacy airline business. Not the largest. Not dominant in Asia and Europe. But well executed.
Aug 14, 2013, 8:54 am
#1813
Join Date: Jan 2008
Location: KAUS
Programs: AA EXP; AC 100K
Posts: 132
...and I hope this remains as a part of the DoJ argument going forward. If the government starts backing down, you can guarantee that you'll start hearing this refrain less and less from them.
Aug 14, 2013, 8:56 am
#1814
Join Date: Dec 2008
Location: WAS, LAX
Programs: AS 100K
Posts: 1,330
That said, I fail to see how they will allow this to go to trial. That would likely take well over a year, and even then the outcome would be uncertain. Would/could be a huge mess. And time is an issue. With DL being back on track after swallowing NW, and UA/CO starting to get untangled, AA has to get back in the game w/o letting several years go by.
Last edited by Microwave; Aug 14, 2013 at 9:25 am Reason: corrected invalid quote syntax
Aug 14, 2013, 8:59 am
#1815
Join Date: Jan 2010
Location: New York and Vienna
Programs: PA WorldPass Platinum, AA, DL, LH. GHA Black, SPG and HHonors Gold
Posts: 3,870
Justice Dept. Suit Signals End of Airline Consolidation, AA-US Airways Merger Said to
I'll contribute this
Justice Dept. Suit Signals End of Airline Consolidation, AA-US Airways Merger Said to Hurt Consumers
Justice Dept. Suit Signals End of Airline Consolidation, AA-US Airways Merger Said to Hurt Consumers
In the last century, the U.S. Department of Justice spent a great deal of time and energy on breaking up large companies that were behaving, in the view of regulators, in an anticompetitive and/or monopolistic manner, ranging from Standard Oil to AT&T to Microsoft. In the current century, the agency’s modus operandi has been a bit more preemptive, moving to block mergers that it felt would create such entities.
On Tuesday, the Department of Justice announced it had filed suit to block the planned merger of American Airlines’ parent AMR Corp. and US Airways, saying the merger would threaten competition and drive up the cost of tickets.
If American and US Airways choose to have their day in court and fight, the battle will certainly last more than several months and could, with appeals, take well over a year.
During that time, the lack of certainty will without question have a negative impact on both airlines.
<SNIP>
On Tuesday, the Department of Justice announced it had filed suit to block the planned merger of American Airlines’ parent AMR Corp. and US Airways, saying the merger would threaten competition and drive up the cost of tickets.
If American and US Airways choose to have their day in court and fight, the battle will certainly last more than several months and could, with appeals, take well over a year.
During that time, the lack of certainty will without question have a negative impact on both airlines.
<SNIP>