'Big deal' may be on way for US Airways

[ElBurro]

http://www.azcentral.com/business/articles/2011/04/06/20110406big-deal-may-way-us-airways.html

Who is Parker talking about?

Over the past half-dozen years, five major mergers have changed the face of the airline industry, reducing the number of carriers with more than 1 percent market share to seven in 2010 from 12 in 2005.
And there's likely another consolidation on the horizon, Doug Parker, CEO of USAirways, said at a media event on Wednesday.
"There's one big deal left and that's (going to involve) US Airways," said Parker, who as America West Airlines CEO led the company's merger with a bankrupt US Airways. "I'd like to be in the position that Continental was with United."
He wouldn't estimate on a time frame or what other major player could be involved in a possible merger.
Parker, a longtime proponent of consolidation, said US Airways is well-positioned for a deal. It's improved its cash position significantly in the past few years and boasted its second-highest profit in 2010.
Plus, US Airways has remained relatively small when compared with its competitors.
The airline commanded 10 percent of the market share in 2010, trailing United Continental Holdings (28 percent), DeltaAir Lines (26 percent), American Airlines (18 percent) and the pending Southwest Airlines-AirTran Airways merger (12 percent).

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[Dornier 335]

Word from the training department is that there's a temporary stop on recalls right now (j/s gossip). Not sure if it has anything to do with the "big deal".

 

[LearLove]

I did hear that they cx'd 2 classes of new hires (guys who interviewed in 2008 but never got a class). Whether it has anything to do with any kind of pending "merger" I have no clue.

 

[Bringupthebird]

The mergers have to produce an obscenely profitable airline, which so far they haven't, in order to entice the money to pull off such a deal.

 

[Quimby]

What could possibly go wrong?

 

[scoreboardII]

Usair/AA?

 

[LearLove]

here we go again, right on time - just as I'm about to buy a house, never fails.

 

[Lear70]

Lear, you just can't get a break when it comes to these things, can ya?

Don't worry, buddy. As far as SLI's go, arbitrators lately have protected people already ON the seniority list and people on furlough (if any) always go to the bottom of the list.

And yes, I'm thinking USAir/AA, too.

 

[humveedriver]

Pure speculation, but with the SWA/AT combination, that doesn't help USA's cause at all. Looking at the mergers the new gold standard for the legacy majors seems to be pilot groups north of 10,000 pilots and 600 airframes. The east coast market has always been the battle ground, and SWA is taking another advance in to that territory. They will be competing against SWA/AT who will have 7629 pilots and 684 aircraft (combined). USA currently has 5137 pilots flying 340 aircraft. Compare that to the "new" legacies. UAL/CAL 11,045 pilots-714 aircraft and DAL/NWA 12,300 pilots-742 aircraft. AA/TWA has 8,738 pilots-612 aircraft.

I predict AA/USA will have DOJ issues due to the overlap of service/slots in DCA,LGA and BOS. The wild card could be Alaska, but I get the impression they don't want to merge with anyone. Although with their entance into HI, I think a Hawaiin/Alaska merger would look good and preserve their niche markets.

Anyway this shakes out, SWA/AT is going to be a very lean competitor. Not surprised that USA is looking to merge again when you look at the numbers.

 

[densoo]

The mergers have to produce an obscenely profitable airline, which so far they haven't, in order to entice the money to pull off such a deal.

Not even close! Mergers are a way for MBAs and lawyers to make money, which they make gobs of no matter what the outcome. "Profitability" and "synergies" are smokescreens for the common folk shareholders and employees so they will offer little resistance.

Nothing has changed from the Gordon Gecko Lorenzo era except the hamhandedness. Except now it is finessed so that all parties go willingly to the slaughter. It isn't the making of money that they are trying to achieve, it is the moving of money. The more that moves, the more they can skim through legal sleight of hand.

In the end, the new airline is left with left with less money, not more. Where did it go? Sorry, it's just the friction of business and the fog of war--and you should be happy to still have a job, you ungrateful bug, after all we did for you. And on to the next corporate victim.