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US/AA merger- MASTER DISCUSSION THREAD/incl 'when will US leave STAR'

View Poll Results: Is an American Airlines/US Airways merger good for the traveling public?
Yes
84
28.19%
No
214
71.81%
Voters: 298. You may not vote on this poll

US/AA merger- MASTER DISCUSSION THREAD/incl 'when will US leave STAR'

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Old Dec 8, 13, 9:45 am   -   Wikipost
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There is an existing thread in the AA forum that may be useful to US and AA Flyertalkers:
US-AA Merger: Just the Facts thread

As facts become posted, that should be the place to look.

Merger discussion, speculation, and other questions can be directed here, or the similar thread in the AA forum:
MERGER: US and AA 9 Dec 2013 and implications for AA flyers (new)

AA - US Merger Agreement / Announcement / DOJ Action Discussion (consolidated, and now closed to new posts)
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Old Feb 16, 13, 4:42 pm
  #226  
 
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Originally Posted by LukasVIE View Post
The question in the poll is " Is an American Airlines/US Airways merger good for the traveling public?" and that's a definitive NO

less competition = higher prices (and probably less routes) as seen in the recent Delta/NWA and United/Continental mergers
I'm not saying airfares won't rise - they almost certainly will in certain markets - but per the Wall Street Journal, fares actually dropped 1% overall between 2004 and 2011 on an inflation-adjusted basis in spite of all of the merger activity:

http://online.wsj.com/article/SB1000...293302268.html (paywalled unfortunately)
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Old Feb 16, 13, 4:58 pm
  #227  
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Originally Posted by Yoshi212 View Post
I've read on the internets, so it must be true, statements that AA could return to service but it would require a lot of concessions (mostly financial). Is any of that true?
Several weeks before the AA purchase of selected TWA assets closed in April, 2001, TWA terminated its JFK-TLV flight as they said it was not profitable and AA had indicated that it would not assume the liabilities for the severence due the 100-some TWA employees in Israel (which might have been $15 million or more). So TWA, which was in bankruptcy at the time, cancelled the route and laid off the employees before AA bought the TWA assets. AA has never served Israel. The TLV TWA employees sued TWA in Israel and obtained a judgment against TWA, which they were unable to satisfy in the TWA bankruptcy proceedings later on in 2001. Under US law, AA has no liability to the former TWA employees (as it was an asset purchase, not a merger).

Lots of interwebs chatter that if AA ever flew a plane to Israel, the employees would use their judgement against TWA to seize the plane until paid. Have no idea whether there is any truth to that, but the fact was, Carty and Arpey had no intention of causing AA to fly to Israel.

US serves TLV and will continue to do so as long as it is profitable. Have no idea whether the former TWA employees have any recourse against AA (and the new AA) - but if they do, then someone will have to write them a check.
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Old Feb 16, 13, 8:46 pm
  #228  
 
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Originally Posted by phlwookie View Post
I'm not saying airfares won't rise - they almost certainly will in certain markets - but per the Wall Street Journal, fares actually dropped 1% overall between 2004 and 2011 on an inflation-adjusted basis in spite of all of the merger activity:

http://online.wsj.com/article/SB1000...293302268.html (paywalled unfortunately)
Intersting article, thanks for linking it

...but I do think that it will get easier for airlines to raise faresc with only three major players left in the market and I am pretty sure that we will see a drastic increase at least on a couple of routes.

Now, a different question is the impact on the US airline industry in general. We could finally see some stability in this troubled industry. I think that this merger may (at least in the long run) be positive for the employees of both AA and US, but I am still pretty pessimistic about the benefits for us customers.
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Old Feb 16, 13, 9:24 pm
  #229  
 
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Originally Posted by GUWonder View Post
US will still be in Star Alliance this summer.



It's AA that charges the high fees on award tickets with BA flights, and AA likes it as is because it increases the revenue AA gets.

That is NOT true. BA charges the "fees" as a surcharge on award tickets. AA just collects it on behalf of BA. Note that there is no similar fee on AA redemptions.
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Old Feb 16, 13, 9:28 pm
  #230  
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Originally Posted by LukasVIE View Post
Intersting article, thanks for linking it

...but I do think that it will get easier for airlines to raise faresc with only three major players left in the market and I am pretty sure that we will see a drastic increase at least on a couple of routes.
If fares need to rise so they can turn a profit that's probably not a bad thing. Better to still have three major players than have one of them go out of business because fares are kept too low.
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Old Feb 16, 13, 9:49 pm
  #231  
 
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I am CP on USAirways but have to say that AA service has always seemed to me to be at a higher level. FC in USA pales next to FC in American. I hope Doug doesn't dumb it down.
This merger has been in the works for several months. I hope that the people on both sides have taken the time to work through many, many of the issues the combination will involve. The could have gone to school on the UA Continental problems.

One thing that is not clear to me is whether the old America West-USAirways pilot issues have been resolved. It is ludicrous that the two airlines were kept separate.
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Old Feb 16, 13, 10:35 pm
  #232  
 
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Originally Posted by LukasVIE View Post
The question in the poll is " Is an American Airlines/US Airways merger good for the traveling public?" and that's a definitive NO

less competition = higher prices (and probably less routes) as seen in the recent Delta/NWA and United/Continental mergers

There is NO evidence of that. Plus airlines losing billions year after year is not good for consumers; it results in service cutbacks and a crappy product.
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Old Feb 16, 13, 11:41 pm
  #233  
 
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Thanks for a realistic and practical answer.
The route seems to be quite profitable for US so I would hate to see it go. I haven't flown it as I use UA for the direct flight but would hate to see a good option go because of some political crap. If a check has to be done to keep this route I hope they write it.

Originally Posted by FWAAA View Post
Several weeks before the AA purchase of selected TWA assets closed in April, 2001........ut if they do, then someone will have to write them a check.
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Old Feb 17, 13, 7:42 am
  #234  
 
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Frankly I'm just praying PHL doesn't get gutted.
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Old Feb 17, 13, 8:09 am
  #235  
 
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Originally Posted by Cargojon View Post
Frankly I'm just praying PHL doesn't get gutted.
You and me both. I think the chances of de-hubbing PHL are slim. If it happens, I am going to move!
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Old Feb 17, 13, 11:04 am
  #236  
 
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Originally Posted by LINDEGR View Post
There is NO evidence of that. Plus airlines losing billions year after year is not good for consumers; it results in service cutbacks and a crappy product.
Most people only care about the price -- not about service cutbacks and crappy products -- how would airlines like Spirit be successful otherwise? Or do you think that they provide a decent product?

No evidence? There are plenty of studies and journal articles out there

Here is a very interesting paper about the possible consequences of the US / AA merger...

http://papers.ssrn.com/sol3/papers.c...act_id=2137188

Last edited by LukasVIE; Feb 17, 13 at 11:23 am Reason: Spelling
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Old Feb 17, 13, 11:16 am
  #237  
 
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Originally Posted by Cargojon View Post
Frankly I'm just praying PHL doesn't get gutted.
Same here for PHX......
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Old Feb 17, 13, 1:20 pm
  #238  
 
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Originally Posted by LukasVIE View Post
Most people only care about the price -- not about service cutbacks and crappy products -- how would airlines like Spirit be successful otherwise? Or do you think that they provide a decent product?

No evidence? There are plenty of studies and journal articles out there

Here is a very interesting paper about the possible consequences of the US / AA merger...

http://papers.ssrn.com/sol3/papers.c...act_id=2137188
Very interesting paper -- thanks for the link. ^
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Old Feb 17, 13, 1:56 pm
  #239  
 
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So here's a question---

If the government approvals were denied---- I know it's a mighty big if--- but suppose just for a minute the merger got shut down by the government--- would US continue to exit Star and join OneWorld, or would US remain in Star?

I know none of us actually know this answer

Curious if Star would be more likely to allow US to remain after whatever's left on their agreement, or if Star would allow that relationship to end since US has shown willingness to ditch Star in order to make this merger happen?
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Old Feb 17, 13, 3:15 pm
  #240  
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Originally Posted by dcpatti View Post
So here's a question---

If the government approvals were denied---- I know it's a mighty big if--- but suppose just for a minute the merger got shut down by the government--- would US continue to exit Star and join OneWorld, or would US remain in Star?

I know none of us actually know this answer

Curious if Star would be more likely to allow US to remain after whatever's left on their agreement, or if Star would allow that relationship to end since US has shown willingness to ditch Star in order to make this merger happen?
they would star in star alliance. If they wanted to join oneworld they'd have to be invited, then go through the whole assimilation process. So that would take a fair while.
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