martin33

CO declined a merger with UA, and there is little chance they would bid for AA.

AA could bid for (a significantly weakened) UA, as high-finance always seems to find a way when a deal is at stake (see US/HP, US's failed bid for DL, etc).

Bottom line: bankruptcy is not currently in the cards for any of the Big 5. but next year? who knows?

zman

The best meger would be US/UA, they deserve each other and both have lots of A320's.
Somehow if AA and CO could get together (all Boeings) would be the best and they have NO over lapping hubs.
The Feds would never approve UA/AA due to ORD.

What happens with AS? - A WN option, maybe.

dayone

I would say that DFW and IAH are effectively overlapping hubs.

zman

Not at 250 miles
If so that would make PHL, BWI, DCA, IAD, BOS, overlapping hubs to NYC

Maybe IAH and HOU could be overlapping
Or JFK and EWR

c_stanley

No he has a point. This is one way of illustrating it:

http://www.census.gov/geo/www/mapGal...s/2k_night.jpg

Note that brightness corresponds to population. I think Reno and Vegas would clearly be overlapping hubs. DC and NYC might not, depending. The concept of overlapping has more to do with what hubs are used for, which is to enable one-stop flying from many places to many other places. So I can between a huge number of city pairs that wouldn't support frequent direct service fairly easily.

Take a look at these several maps:
http://www.airlineroutemaps.com/USA/...ines_DFW.shtml
http://www.airlineroutemaps.com/USA/...ines_ORD.shtml
http://www.airlineroutemaps.com/USA/...ines_MIA.shtml

And then take a look at these:
http://www.airlineroutemaps.com/USA/..._america.shtml
http://www.airlineroutemaps.com/USA/...ope_asia.shtml

And it starts to make sense. This isn't some grand secret thing I've discovered it's the core theory of hub and spoke airline service.

But consider these:
http://www.airlineroutemaps.com/USA/...pe_india.shtml
http://www.airlineroutemaps.com/USA/...ines_usa.shtml

And explain to me how there are no overlapping hubs. They don't complement each other at all. How do you get from LAS or PHX to ATL on CO? How do you do it on AA? Right, you connect in Texas.

Same general principle applies to the long haul routes, where there's real money to be made. Dallas and Houston are big but there's no population density anywhere in the US that compares with the NE corridor. A logical hub structure depends on O/D traffic (abb. for origin and destination) as well as a logical geographic location. Take for example the way routes into MIA make for pretty rational straight-line connections to Caribbean islands and South America. And so on.

Now look back at the CO map and the AA map and dayone's comment makes a lot of sense. 250 miles is just 1% of the way around the globe. It's a big world.

Now compare those three AA maps at the top with this domestically:
http://www.airlineroutemaps.com/USA/...Airlines.shtml

Or these and the various other BA ones:
http://www.airlineroutemaps.com/Euro...e_london.shtml
http://www.airlineroutemaps.com/Euro...est_asia.shtml
http://www.airlineroutemaps.com/Euro...s_africa.shtml

That's what complementary looks like. This is a long running FT topic, there's no "right" answer. But as much as I'd love more options from the NYC area, it's hard to see how AA and CO merge without creating a ton of dead weight that someone will come out on the losing end of.

dayone

If operated by the same (read: merged) airline, DFW and IAH would be overlapping.

Radiant Flyer

I just did a search in yahoo news, and there is no mention of American Airlines filing for bankruptcy soon only article I could find that mentioned a filing was dated 2003. Someone is misinformed.

scubadu

You might want to read the thread a bit more closely. Nobody is stating that AA has filed for bankruptcy; people are discussing how the "chess game" in the airline industry could/might evolve over the next year or two. It's called "speculation."

Regards

martin33

The argument about east-west travel and taking distances as a percent of 25,000 miles rtw would certainly apply to DL running DTW and MSP (even ignoring the 3rd and 4th baby elephants in that room, CVG and MEM). The east or west based traveler has little reason ex ante to prefer any of them over the others.

Whether or not a "twin" (or more) hub system can work is a function of both the O&D at those hubs, and the overall connecting throughput of the system. One can argue that IAH and DFW overlap, but you couldn't shut one down and route all of its traffic through the other. On its own, HP had no trouble running the seemingly nutty twin hubs at PHX and LAS. AS maintains, under constant pressure, big/small twin status at SEA and PDX.

Whether or not a merger can work is a question of whether efficiencies can be achieved. Complementary systems are certainly one way to achieve that--- opening up lots of new city pairs to serve. Overlapping systems, on the other hand, offer opportunities to divert resources to better use--- for instance in the AA/CO case, the CLE operation would look ripe for pulldown and reallocation...

Such a merger does not seem likely, but it sure is fun to analyze..

Radiant Flyer

Sorry "scubadu" maybe you need to read the all the post more carefully. " tjisnumbaone" posted yesterday that he though he read on yahoo AA may file for bankruptcy. my post was in response to his post and a few that followed. Just learning how to use this, sorry if your confused. I copied his post below.

tjisnumbaone WROTE:
" you don't mind I'd like to chime in.
Saw this news story today on Yahoo, must say it may just be a over reaction, but that isn't always the case. AA going into bankruptcy?? Maybe, hopefully not. Hopefully the liquidation will be helpful.

Any thoughts on a merger for AA??

Hopefully the new 738s taking out the ancient Mad Dogs will help save fuel and lower costs.

Good luck AA."
__________________

zman

The feds did not have an issue with DL with CVG and DTW which are closer then HOU and DFW.

martin33

yes, certainly not "overlapping" in the sense of anti-trust considerations... that would be a hard case to make even for EWR/JFK.

c_stanley

Well since we're just chatting, you could speculate how long you think DTW will last in the new merged system. Given the precipitous dropoff in the core businesses in the Detroit area perhaps there's a longer term plan in mind.

zski1

It was a blog post, not a published article.

scubadu

Fair enough. My bad. Obviously, I do recommend learning how to properly quote posts you wish to respond to. Had you "quoted" the post you referenced, I would have seen both and would have made the connection. Not quoting what you want to reference in a quick moving, numerous post thread, ends up leaving your post hanging out there like a random comment, not in reference or response to anything else.

Anyhow, apologies if I ruffled your feathers, not my intent.

Regards