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-   -   Continental Pre/Post Merger Speculation Discussion Thread (https://www.flyertalk.com/forum/continental-onepass-pre-merger/813075-continental-pre-post-merger-speculation-discussion-thread.html)

bnrdad Dec 13, 2006 7:49 am


Originally Posted by CO757 (Post 6839679)
Couple of counter points to your weak arguments:
[LIST=1][*]US Airways is still around because its name isn't limiting to a particular region of the USA (i.e. America West, Eastern or Western).

Speaking of weak arguments:

Yeah, that limiting name "Southwest" sure has kept them from being the fastest growing and most consistently profitable airline in the US!

ClipperDelta Dec 13, 2006 7:59 am


Originally Posted by bocastephen (Post 6841005)
Something tells me this is only going to happen if US is successful taking over DL - which is in itself very doubtful.

Exactly. It all hinges on whether the US-DL fiasco goes through. I'm sure Larry K. will throw away Tilton's number the minute the US-DL deal falls apart; NW, AA, and CO are very unwilling participants in this whole thing. If DL manages to fight off US (and any subsequent suitor), then Parker and Tilton will be the only ones left standing at the street corner - maybe then they can be each other's 'rhymes with witch'.

bocastephen Dec 13, 2006 8:04 am


Originally Posted by bnrdad (Post 6841077)
Speaking of weak arguments:

Yeah, that limiting name "Southwest" sure has kept them from being the fastest growing and most consistently profitable airline in the US!

It's abit different. Southwest is not a name at this point, it's a brand, or even a marketspace identifier. Their longevity with that name and previously solo ownership of their marketspace for many years has overridden any chance people might associate the name with a limiting factor, present day. When people think of cheap airfares, they think of Southwest. When people think of Southwest, they think of cheap airfares. Regional association might only be discovered when researching brand identity with people from outside the US, which is not Southwest's market.

The marketspace presence of America West and their brand recognition was/is no where near that of Southwest. It was reported that people couldn't even get America West's name right (calling it AmericaN West). Even their logo/color branding was "Western" style.

I think it must have been a tough call, though. If you asked seasoned air travelers what they associated with the USAir name/brand, you would probably hear things like "dirty planes", "always delayed", "poor service", etc. Not exactly a great brand name and reputation to inherit, but in the big picture they made the right choice. Now if they focus their energy on cleaning up their own airline instead of poisoning Delta, they might be successful.

CO757 Dec 13, 2006 8:12 am


Originally Posted by jaguar (Post 6840793)
Just hope CO takes control of the combined airline.


I think that is going to be a requirement from the investors (my stock vote would depend on it).

CO757 Dec 13, 2006 8:19 am


Originally Posted by bnrdad (Post 6841077)
Speaking of weak arguments:

Yeah, that limiting name "Southwest" sure has kept them from being the fastest growing and most consistently profitable airline in the US!

Yeah, one exception in a sea of Western, Western Pacific, Midwest, Eastern, Northeast Airlines!

haddon90 Dec 13, 2006 8:31 am

i really hope both CO and UA stay away from this. CO would take away E+, ruin mileage plus, and who knows what else UA offers. UA and CO have different markets, in my opinion. CO does fairly well in the smaller markets in europe, whereas UA is pretty dominant in the pacific. also, UA's widebody aircraft are far superior to the widebodies CO uses. and the E170? domestic 3-cabin service? CO, please stay away. you run a good ship with your own stuff. you'd be better suited to merge with NW.

murphy Dec 13, 2006 8:31 am


Originally Posted by bnrdad (Post 6841077)
Speaking of weak arguments:

Yeah, that limiting name "Southwest" sure has kept them from being the fastest growing and most consistently profitable airline in the US!

Good point. The name Southwest hasn't hurt their brand image at all in Europe, Asia, and South America.

Bernoulli 777 Dec 13, 2006 8:35 am

CNN: "UA and CO flirt with merger"
 
See: http://money.cnn.com/2006/12/13/news/companies/united_continental_merger/index.htm?postversion=2006121306

United and Continental flirt with merger
Following last month's industry shakeup, another two airline giants are discussing a possible merger.
December 13 2006: 8:18 AM EST

NEW YORK (CNNMoney.com) -- UAL's United Airlines is in preliminary talks with Continental Airlines about a possible merger, according to media reports.
Any deal between the two carriers would likely be one of the largest in the industry and create one of the world's top 10 airlines.


A month ago, US Airways (Charts) made an $8.7 billion takeover bid for rival Delta (Charts), raising expectations of consolidation in an industry struggling with high fuel prices and competition from discount carriers.
Talks between Continental and United, which each have market value of about $4 billion, picked up pace after US Airways made the offer last month, The New York Times reported on its Web site on Tuesday, citing unnamed sources.
The two airlines have been in talks for several months, the Wall Street Journal said in a report on its Web site, also citing unnamed sources.
A spokeswoman for United (Charts), the No. 2 U.S. carrier, said the airline does not comment on rumor or speculation. Fourth-ranked Continental (Charts) could not be immediately reached for comment.
United also recently contacted Delta and its creditor committee about a possible merger, the Journal said.
A Delta spokeswoman said she had no comment on the report.
The chief executive of United Airlines parent UAL Corp. on Tuesday reiterated his view that the airline industry needs consolidation, but said he was not ready to disclose United's likely role in any consolidation.
"We think it is good and overdue for the industry despite the fact that it is difficult," Glenn Tilton said on a Webcast of a UAL investors meeting earlier on Tuesday.
"We are not in position to comment on anything specifically," Tilton said, adding the airline is attentive to merger opportunities.
Tilton and Continental Chief Executive Larry Kellner have met to discuss the possible merger, The Times said.
Continental has said recently that it too would consider a merger if it is necessary to remain competitive.
But any merger involving Continental has an added complication. Bankrupt Northwest Airlines (Charts) holds a so-called "golden share" in the airline, giving it the right to block mergers involving Continental.
Last week, Northwest asked a U.S. bankruptcy court for permission to hire financial advisory firm Evercore Group to help it evaluate strategic alternatives, including a merger.
AirTran Holdings (Charts) is also preparing to make an offer for Midwest Air Group (Charts), the Journal reported on its Web site on Tuesday.


The rumors get louder!

B7

cptlflyer Dec 13, 2006 8:51 am


Originally Posted by haddon90 (Post 6841376)
you run a good ship with your own stuff.

Yeah, the problem is that UA doesn't. :p

CO FF Dec 13, 2006 8:59 am


Originally Posted by Anglo Large Clawed Otter (Post 6840978)
If this merger does go through, CO would do well to have a hard look at how AF/KL pulled off their merger...via slow, steady integration that preserved two distinct brands (at least for now). That sort of merger might help water down some of the harsh effects of merging two fairly disparate corporations.

Great idea.

Internationally, an all-widebody product with 3 classes, a new F suite and a renamed but otherwise unchanged "BF" as the business class product.

Domestically, run the "PS" product under the Continental name in major markets on 757s, and the "Ted" product (if the combined airline is called Continental, maybe Ted becomes "Al"? :p ) on Airbus & 737s as an alternative.

bocastephen Dec 13, 2006 9:03 am

I flirt all the time, but alas, I am still unmarried :)

CO and UA can flirt - a year's worth of UA/CO merger-mania posts aside, I am convinced this is only strategic talk in case DL is taken by US, which in itself is a long shot.

Airline mergers generally only work when both companies join the marriage happily. I can't remember the last time one company pulled off an overtly hostile acquisition of another airline. Just think of what the Delta employees at the 'new Delta' whose heads are on the chopping block will do to Parker's airline before the door hits them on the way out.

No, I just don't see US/DL happening, and thus UA/CO is very unlikely as well.

bocastephen Dec 13, 2006 9:08 am


Originally Posted by CO FF (Post 6841576)
Great idea.

Internationally, an all-widebody product with 3 classes, a new F suite and a renamed but otherwise unchanged "BF" as the business class product.

Domestically, run the "PS" product under the Continental name in major markets on 757s, and the "Ted" product (if the combined airline is called Continental, maybe Ted becomes "Al"? :p ) on Airbus & 737s as an alternative.

I don't think LK shares the vision for PS and Ted. PS works in very defined markets, while TED is a LCC model that CO won't go near after their CALite experience.

I think all the Airbus crap will be jettisoned as part of the fleet rationalization plan, with the combined airline going all Boeing.

Don'tGoThere Dec 13, 2006 9:22 am


Originally Posted by CO FF (Post 6841576)
.....Internationally, an all-widebody product with 3 classes, a new F suite and a renamed but otherwise unchanged "BF" as the business class product.

Renamed doesn't equate to "unchanged"? BusinessFirst is TM and would be used on all Widebodies; First Suite would likely go away (unless it is money maker...doubtful).


Domestically, run the "PS" product under the Continental name in major markets on 757s
This would also likely be remodeled to be BF; if CO management survives. It might not be immediate, but within a year or two.


.... "Ted" product ...
Right....we know what will happen to "Ted"....bye bye Ted

ND Sol Dec 13, 2006 9:27 am


Originally Posted by murphy (Post 6841377)
Good point. The name Southwest hasn't hurt their brand image at all in Europe, Asia, and South America.

How about Northwest? :)

theblakefish Dec 13, 2006 9:28 am

Matt Lauer just talked about it on the Today Show....just in passing terms that it would be the US's biggest airline.


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