CAL Merger Plans

[Occam's Razor]

Unless it is given up as part of the deal in order to gain fed approval.

That's what "...dependent upon the terms of such a merger." meant.

The issue is whether CAL has enough "independence" to pursue a merger. The answer is NO. Not "maybe" or "under the right circumstances". Simply, and utterly, NO.

CAL's ability to merger, acquire, sell assets...or to form alliances or code-shares is controlled by the NWA Board until 2023. Yes, it could be purchased or bundled with a set of terms that are to NWA's benefit...but the path leads through Building "A" in the sleepy suburb of Eagan, Minnesota (Go Wildcats!).

No amount of wishing or speculating can change the agreement, or it's terms.
The Armani-clad weasels who drew up the document were well-versed in the skills of the Armani-clad weasels who it was intended to limit. Know that.

 

[Deerkiller]

If my math is right, that was 7 years ago. Of course it always counts the 274 RJ's. Are we the youngest? Maybe.

With math skills like that what are you doing flying airplanes...

dk

 

[Hutchman]

With math skills like that what are you doing flying airplanes...

dk

Sometimes I wonder.

 

[SteelerMan]

According to airfleets.net, as of earlier this year.

AirlineAverage Age Fleet Size
AirTran 3.7 108
Alaska 10.0 110
Aloha 15.4 19
America West 11.9 108
American 13.3 699
American Eagle 5.3 267
ATA 6.6 25
Continental 8.5 356
Delta 13.1 434
Horizon 5.6 67
JetBlue 2.8 97
Midwest 9.3 35
Northwest 10.8 266
Southwest 9.4 445
United 11.7 401
USAirways 10.4 248

 

[SteelerMan]

BID, that is what Kellner says too.

 

[whymeworry?]

Doesn't want Airbuses -- good thing going with Boeing and would have to get the busses for "free" to incur the added pilot training costs and maintenance/stores/parts issues that would arise. Plus, they said they still have nightmares from the A300 days of long ago. I guess Airbus was not a pleasurable company to deal with.

Makes sense.

I like the bus. Love the "no-yoke" thing. But they are a very pompus corporation to the core. I did a contract for them years ago. Everywhere I turned, within the company, I was met with the typical French attitude.

Look at what they did to AMR after the crash of Flt 587 in Queens. Their engineering department virtually raked the whole AAL flight ops dept over the coals in court. I watched it on TV. It was tragic. Airbus NEVER accepts responsibility, or so it seems. Pretty hard to do business with a company like that. It's amazing they got to where they are today... oh yeah, gov't subsidies.

Hey, flame away if you want Airbus lovers. Like I said, I really like the bus. Wish I flew one cause I want a desk up there. They are still a bloviating corporation, nonetheless.

 

[whymeworry?]

That's what "...dependent upon the terms of such a merger." meant.

The issue is whether CAL has enough "independence" to pursue a merger. The answer is NO. Not "maybe" or "under the right circumstances". Simply, and utterly, NO.

CAL's ability to merger, acquire, sell assets...or to form alliances or code-shares is controlled by the NWA Board until 2023. Yes, it could be purchased or bundled with a set of terms that are to NWA's benefit...but the path leads through Building "A" in the sleepy suburb of Eagan, Minnesota (Go Wildcats!).

No amount of wishing or speculating can change the agreement, or it's terms.
The Armani-clad weasels who drew up the document were well-versed in the skills of the Armani-clad weasels who it was intended to limit. Know that.

Wrong. According to LK, from what I've read, CAL can only merge/ acquire if it is the acquiring carrier, i.e. no entity can buy CAL without NW consent. By contrast, CAL is indeed free to purchase whatever they wish be it another airline or a catering company.

If CAL can muster up enough cash to buy UAL, it will happen. It would probably take a $10 billion credit line to do so, however. I'll bet anyone LK is meeting with banks at this momenet to effectuate some sort fo deal. Whatever deal it is, CAL will have to be the acquiring carrier. Which means CAL will have to come up with the cash. LK will probably line everything up to occur once he and his team are absolutely certain the DAL deal is indeed going to happen. He is a very sharp man. He won't be the last man standing but at the same time he won't do anything until he is sure DAL is a done deal. FWIW most airline executives think no way DAL/ US deal will fly. You've got to have two partners to merge, that's the most basic principal of a service business merger. DAL, by far the larger carrier, is completely resistive to this process. That critical mass is going to be incredibly hard for USAir to overcome. I'm not saying it won't happen but, as of today, it's a real stretch. Consequently, expect the status quo in this business until more news about the progress (or lack thereof) of the US deal emerges.

 

[ESS PWR]

That's what "...dependent upon the terms of such a merger." meant.

The issue is whether CAL has enough "independence" to pursue a merger. The answer is NO. Not "maybe" or "under the right circumstances". Simply, and utterly, NO.

CAL's ability to merger, acquire, sell assets...or to form alliances or code-shares is controlled by the NWA Board until 2023. Yes, it could be purchased or bundled with a set of terms that are to NWA's benefit...but the path leads through Building "A" in the sleepy suburb of Eagan, Minnesota (Go Wildcats!).

No amount of wishing or speculating can change the agreement, or it's terms.
The Armani-clad weasels who drew up the document were well-versed in the skills of the Armani-clad weasels who it was intended to limit. Know that.

I would be inclined to believe this guy who was actually at the helm of CAL when the deal was signed. http://www.chron.com/disp/story.mpl/front/4350410.html

At the bottom says,

[Bethune was leading Continental when the agreement with Northwest was reached. "When our board agreed, it just says we can't be bought by another airline," said Bethune, who is now chairman of the board of Aloha Airlines. "But that didn't preclude Continental from buying someone else."]

I would think the DOJ would be hard pressed to allow a company restrict the growth of one of its competitors in any fashion. That would be called monopoly and not good for consumers.

 

[UALfurloughee]

Just repeating what we were told in a new-hire by Larry and Jeff.

CAL:

Doesn't want Boeings in different configurations/powerplants. Seems reconfiguring the ATA 757-300's was more pain than they hoped.

Doesn't want 747's -- doesn't want anything with more than two motors...and they are trying to figure out a way to get ETOPS approval to shut one down intentionally to save gas -- j/k

Doesn't want Classic 737's -- getting nothing but NGs. We're putting winglets on some Classics b/c the price was right (next to nothing) and the added fuel efficiency + future resale return is worth it.

Doesn't want Airbuses -- good thing going with Boeing and would have to get the busses for "free" to incur the added pilot training costs and maintenance/stores/parts issues that would arise. Plus, they said they still have nightmares from the A300 days of long ago. I guess Airbus was not a pleasurable company to deal with.

Are you refering to CAL when you talk about the youngest fleet? 'Cuz that's what they tell us...that we (CAL) has the youngest fleet in the US...of course that's probably what they told new-hires at NWA

Thanks - that makes sense - it leaves a lot to be desired to be compatible with CAL. I think every airline has their Kool-aid, as we are advertising on jetbridges that we have the youngest fleet - probably includes the RJs to get that number. I do know that we don't have any "Jurrasic" jets anymore.

 

[Occam's Razor]

Wrong. According to LK, from what I've read, CAL can only merge/ acquire if it is the acquiring carrier, i.e. no entity can buy CAL without NW consent. By contrast, CAL is indeed free to purchase whatever they wish be it another airline or a catering company.

Oh...I didn't realize your CEO said that's the way it works! How foolish of me!

Believe who and what you wish. I was there when the deal was ratified by the NWA MEC.