akelkar

Unfortunately I don't think I'll be flying through that airport anytime soon, at least not until the merger's fate has been decided haha

I'm guessing it was all pretty scripted though. And some were most probably taken out of the context they were meant to be interpreted in

AA_EXP09

True.

DCann

This just in although no surprise given the parties' prior announcement that they planned to extend:

American, US Airways Extend Merger Agreement Deadline

phlwookie

I randomly ran into a blog post on the accounting treatment of this proposed deal from an former professor of mine from undergrad:

http://grumpyoldaccountants.com/blog...s-airways-deal

Interesting perspective.

serfty

That article does not take into account any of the recent (significant) turnaround in AA profitability-with perhaps an indication the view the figures as ch11 type rubbery.

Superguy

I think the questions it asks are still valid, even if the data is somewhat different now.

phlwookie

Actually, it was posted on August 31, 2013, three weeks ago. Besides, the DOJ didn't file its case six months ago, which is discussed in the article. The quote at the top is older.

Also, be careful of accounting of companies in bankruptcy - there are many maneuvers, including when they exit bankruptcy, that can make an individual quarter look far better or worse than it really was and complicate analysis.

serfty

True, but the article certainly appears to be ignoring or discounting the published consistent upward trend over the last 12 months.

radiowell

Full disclosure: Although I have been treated very well as a US flier (if at the top elite level), I am NOT a US apologist by any means. In fact, I don't care if all companies go broke, as long as airline industries clean up themselves and fly people in a dignified manner. AND, I don't support the merger, not because I like one airline over another, but because competition is good for everyone. I can easily change my loyalty as my location/work/policy dictate.

Having said all that...

Why the end of the Wright Amendment is so seldom mentioned in the discussion? I often hear US is going down if allowed to be a standalone airline, and AA is going to be just hunky-dory. But I wonder how WN will react once the Wright Amendment is expired (coming next year)? I am pretty sure they didn't take it too well, and I don't think they "forgave and forgot." And WN is no longer the crappy little airline that Jay Leno makes fun of.

I am really curious how AA will react (assuming merger hasn't happened Oct 2014).

HP, on the other hand, have been fighting WN "to the death" ever since I remember. Remember this?

http://www.youtube.com/watch?v=-pbSANdJyiA

(Oh, the irony!)

gottaluvNW

http://www.usatoday.com/story/todayi...lline/2854025/

Merger Deadline extended to January 2014.

Does this mean, should the merger go through, that US is in Star Alliance till at least January 2014?

ellinj

I don't think it means anything in terms of Star, it just means that they have till January to get it done before AA can start looking at other options to exit Bankruptcy. I don't think US can realistically exit Star the day the merger completes or necessarily has to on any specific time frame. Until an announcement is made we just don't know.

FWAAA

The end of the WA will no doubt place some more pressure on AA in the metroplex. A WN mechanic recently posted elsewhere, his fantasy that WN would ramp up from its current 130 daily DAL flights to approximately 250 daily flights. Obviously, that won't happen with just 16 gates at Love Field, but he's never been constrained by facts.

For some perspective, WN has about 250 daily flights at MDW, its largest station, operating from 32 gates, twice as many as it will have at DAL. It's unrealistic to believe that WN will ever have more than about 160 daily flights from DAL, approximately 30 more than today.

A somewhat similar situation exists about 240 miles away in Houston, except that WN has been able to fly to any domestic destination it wants from HOU. Interestingly enough, UA (formerly CO) still has a larger share of the local traffic from the Houston area to many of the West Coast and East Coast cities.

WN will be able to cancel some of its small within-perimeter cities from DAL, which will free up some gate space, permitting some expansion to the West Coast and East Coast

WN isn't the insanely low-fare carrier it used to be. And the WN experience in PHL should be instructive. AA has a fortress hub position at DFW, has lots of corporate accounts and has a huge loyal following of frequent flyers. Just like US at PHL.

While suits are more than willing to fly WN between DAL and HOU, DAL and SAT and HOU and SAT, as WN has many frequencies for those short flights, suits and other business travelers aren't going to line up to fly WN on 3-4 hour flights from DAL to SEA or BOS or FLL (WN still doesn't serve MIA). I doubt that WN is going to take away lots of AA business from DAL to SAN, LAX, SNA or SFO.

Suits and other business travelers don't check bags, and thus get no benefit from the WN "bags fly free" campaign. If anything, they realize that their WN tickets include a bag charge component for a service they aren't using. And given that many of them in the metroplex are elite AAdvantage members, they're exempt from the bag fees on those rare occasions that they must check a bag for business travel (or when they redeem their miles for family vacations and the spouse and kids all check bags).

I'm sure that the end of the Wright Amendment will put a mild hurt on AA as WN will siphon off some bottom-feeders, but I don't see it damaging AA's finances in a big way.

And just this week, WN has again devalued its RR2.0 program, angering its loyal customers. On balance, I think that AA will continue to attract a lot of local traffic at DFW, just like UA attracts a lot of local traffic at IAH and just like both UA and AA attract a substantial portion of Chicago local traffic at their hubs at ORD, despite WN's 250 daily flight operation at MDW.

phlwookie

Maybe, but it's also more focused on valuations and goodwill, which are minimally impacted by individual quarters' results. Better results from improved operations and revenue of course do reflect in other areas, such as free cash, ability to pay down debt in the long term, etc. I think the point is that there is risk that the post-merger entity may be on weaker financial footing than some realize.

gglave

On the 8th I have to fly from YVR to STL. AC wanted $1200 - No way the bean counters would have approved that. Up steps US Airways: $850, with full AQMs, no second walk through security mid-way through my trip and duty free buy-on-board.

Easy decision.

Gonna miss them when they've moved over to One World, but until then I'm going to keep throwing them my business.

HerpaYvr

I hear you, I used US Airways from SYR to MIA, BOS, MYR,DCA, IAD they were clean, had newer planes and wi-fi on most aircraft and of course cheaper than AC will full points.

Yup I will miss them, may even have a short cry!