Colleen Barrett: Lakefield & Parker must be on drugs

[lowecur]

She is funny:

About the prospects of a merger between US Airways and America West Airlines, Barrett said America West Chief Executive Officer Doug Parker and US Airways Chief Executive Officer Bruce Lakefield "must be on drugs. I think they're crazy. I don't know why anybody in today's environment would want to add more woes to what they got. ... I don't know [if] the deal will come to pass."



http://www.post-gazette.com/pg/05132/502929.stm

 

[Wiskey Driver]

It's somewhat difficult to really get a read on the the true feelings of SWA about this merger. On the one hand it would undoubtly make AWA the largest LCC giving the folks at SWA some pause. On the other hand they may not be worried at all thinking that in todays environment a merger of this magnitude is terminal. In my opinion and that's all it is. I think that they are somewhat worried. SWA never banked on a proven LCC to play spoiler in markets that SWA is just entering (PIT,PHL) The next 12months should prove if nothing else to be interesting.


WD.

 

[mach none]

It's somewhat difficult to really get a read on the the true feelings of SWA about this merger. On the one hand it would undoubtly make AWA the largest LCC giving the folks at SWA some pause. On the other hand they may not be worried at all thinking that in todays environment a merger of this magnitude is terminal. In my opinion and that's all it is. I think that they are somewhat worried. SWA never banked on a proven LCC to play spoiler in markets that SWA is just entering (PIT,PHL) The next 12months should prove if nothing else to be interesting.


WD.

Proven LCC? Weren't you on the ropes prior to 9/11 and the ATSB bailed you out. This merger is suicide for Cactus. What do you inherit? High costs and lots of unhappy people. How will the seniority intergration go? Isn't Usair's junior pilot, not on furlough, about the same seniority as the most senior at Cactus? Probably pretty close.

Being the biggest is not necessarily the best, nor does it guarantee success.

 

[chase]

While some companies may worry what a competitor(s) may do or not do, determining what direction one is going to take one's company must be based upon a generally sound business plan. While no one on this board or anywhere else for that matter in cyberspace knows what the next 12-24 months will bring for LCC & legacy carriers I'm confident in knowing that regardless of what if any shape a merger between USAir & AWA may take, Southwest has some good plans in place:


1. "A" plan in case nothing changes & everything remains status quo
2. "B" plan in case a merger occurs
3. "C" plan in case United falters
4. "D" plan in case (you fill in the blank)

A simple football analogy that kind of makes sense, at least to a rather simple minded FO....

Quarterback walks to the line of scrimmage with a play called & ready to go....looks over the defense & sees a shift in the defense....an audible is called & the play is changed at the line of scrimmage.

The next time he does the same thing & he sees exactly what he is expecting...he again makes the assessment but this time runs the called play.

Each down results in a play being planned for & executing it....that's a requirement...moving forward.

Either way, the QB has a plan in mind...in fact he has several plays in mind....he doesn't fear the opponent since he's confident in the underlying strength of his team....circumstances can change but the QB is ready to take advantage of circumstances as they occur or at least as a minimum implements the game plan that was outlined by the "coach".

Again maybe too simple but Southwest has not shown a propensity to "worry" too much about what the competitors do or don't do. It's about having a plan, simple but effective & sticking with it unless an opportunity comes up & then you audibilize & take advantage of the circumstances one is given....no whoa is me or would've, could've, should've....its about playing offense vs. defense & fortunately due to many factors (mostly good employees & creative leadership + a little luck) the plays get called & we run with them....not everything will be a long run but the goal at the end of the day is to make money & the scoreboard shows we've been doing OK....we could be doing better & I think we will but as for "worrying" about the competition....respect yes, take for granted, no.....but worrying doesn't add to the bottom line...I think Colleen expressed a view held by many folks, even some AWA folks I have spoken with. Some worthless ramblings, read at your own risk

 

[airlinepilot]

Lcc Not

AWA will be a LCC right up until the ink is dry on the merger. The high cost of USAIR could only raise the overall cost of any LCC to the point where they no longer are low cost.....and in the case of USAIR.......the only thing higher than their cost will be the debt

 

[BeCareful!]

Whatever. AWA has debt, too. So does DAL, UAL, AMR.....


In reference to the legendary "high costs" at US Airways, does anyone have a current seat mile cost for the two carriers. I had heard that U got the costs down around $.08/mile excluding fuel. How does that compare? I think SWA's apples-to-apples comparison was about $.06-$.07. And what is AWA's? Just wondering.

Donning protective flame gear! I know how touchy people are around here when anyone suggests that things are not as bad as they seem at US Air!

 

[AKMD80GUY]

D.W. had it right at ALPA when he said that the best thing in the industry is to consolidate airlines. That way they can go down two at a time. And that means less paper work!!

 

[AA717driver]

With AWA taking on the East Coast IAM they might as well hire the Gotti's to manage the place. The IAM has been stealing airlines blind for 40 years. This just extends their run.

This will not be a good deal for AWA. Sorry.TC

 

[OffHot]

AWA might have the right plan, but the enviornment of the industry and USAir make it difficult to succed without an acceptable plan that all labor can agree to (this is the difficult side of the merger). On paper right now they will be the largest LCC, but who says that they won't down size, most mergers do, this will also reduce the debt. AWA can't handle USAir's debt, even USAir can't handle its debt. As with the case of United and their airplane leases, some highter judges are tired of allowing lower judges the ability to level the whole industry just to protect one airline, so how much longer will judges be able to protect the bankrupt airline? Just as SWA leveraged ATA, AWA wishes to leverage USAirs primary assets, which they have many, mostly the east coast routes. Unlike SWA, AWA doens't have the balance sheet to take USAir out bankrupcy, so a merger is the next best thing. If AWA/USAir management, big if, create a doable plan then it can work, else AWA sheds USAir or files chapter 11 again.

 

[reepicheep]

AAA costs still hover near 11c including fuel, AW is 6+. AAA's high costs are endemic to the operation and the result will simply be to create another doomed, high-cost carrier.

As for cultural differences - better start boning up on The Sopranos.

 

[Wiskey Driver]

Proven LCC? Weren't you on the ropes prior to 9/11 and the ATSB bailed you out. This merger is suicide for Cactus. What do you inherit? High costs and lots of unhappy people. How will the seniority intergration go? Isn't Usair's junior pilot, not on furlough, about the same seniority as the most senior at Cactus? Probably pretty close.

Being the biggest is not necessarily the best, nor does it guarantee success.

That was then this is now!!!! Several yrs ago most had written CAL off which was the second part of the Texas air group, Eastern being the first. I am never suprised by the savy business sence that is often displayed by my fellow aviators. Most of the comments made in this string simply not true. AAA HAD high cost but were able to corral that AAA HAD high labor cost but that too has been brought under control. The major problems facing AAA today are high fuel cost which are a killer to any carrier that were unable to hedge. Lack of ENOUGH crews to operate the airline sufficiently thus causing many cancellations. The worst is it's extremely poor management!!! I won't go into all of it because it's just too long but take a look at their corp offices. They are based in one of the country highest real estate markets paying millions in rent and or mortgage and should have gotton out of their at the first sign of serious trouble. The reduction of a/c with higher lease payments will help to further reduce their costs. In fact If I were running the show I would be looking to enter a long term relationship with airbus under simular terms given to JB when they started!!!

Bottom line here, these people see things that the avg person ON THE OUTSIDE (corp offices) just don't see. Most finance companies won't loan money if they can see how to get it back!!!

WD.

 

[Guppiedriver]

Proven LCC? Weren't you on the ropes prior to 9/11 and the ATSB bailed you out. This merger is suicide for Cactus. What do you inherit? High costs and lots of unhappy people. How will the seniority intergration go? Isn't Usair's junior pilot, not on furlough, about the same seniority as the most senior at Cactus? Probably pretty close.

Being the biggest is not necessarily the best, nor does it guarantee success.

You haven't read ALPA's merger policy have you?

 

[BeCareful!]

AAA costs still hover near 11c including fuel, AW is 6+.

reep -

You sure about that? Roughly 40% higher costs at U?

I think that's pure BS. Please, prove me wrong by providing sources for your "info."

 

[ivauir]

That was then this is now!!!! Several yrs ago most had written CAL off which was the second part of the Texas air group, Eastern being the first. I am never suprised by the savy business sence that is often displayed by my fellow aviators. Most of the comments made in this string simply not true. AAA HAD high cost but were able to corral that AAA HAD high labor cost but that too has been brought under control. The major problems facing AAA today are high fuel cost which are a killer to any carrier that were unable to hedge. Lack of ENOUGH crews to operate the airline sufficiently thus causing many cancellations. The worst is it's extremely poor management!!! I won't go into all of it because it's just too long but take a look at their corp offices. They are based in one of the country highest real estate markets paying millions in rent and or mortgage and should have gotton out of their at the first sign of serious trouble. The reduction of a/c with higher lease payments will help to further reduce their costs. In fact If I were running the show I would be looking to enter a long term relationship with airbus under simular terms given to JB when they started!!!

Bottom line here, these people see things that the avg person ON THE OUTSIDE (corp offices) just don't see. Most finance companies won't loan money if they can see how to get it back!!!

WD.

No more posting while drunk It's pretty unclear what your point is here WD, but it seems like you are praising mgts ability to see what others cannot on the one hand and then slamming them for being based in one of the hottest real estate markets in the country on the other. I'd be pretty concerned about mgts real motivation in a merger. Cactus has made a nice recovery, and things seem pointed in the right direction. Merging with USAIR would expose them to a massive debt burden, the highest CASM in the industry and a workforce whose bad morale has become the suff of folklore (bags dumped in the river anyone?). I'll bet if this deal goes through they'll be some nice bonuses and golden parachutes for mgt.
Best of luck to all concerned.

 

[Wiskey Driver]

No more posting while drunk It's pretty unclear what your point is here WD, but it seems like you are praising mgts ability to see what others cannot on the one hand and then slamming them for being based in one of the hottest real estate markets in the country on the other. I'd be pretty concerned about mgts real motivation in a merger. Cactus has made a nice recovery, and things seem pointed in the right direction. Merging with USAIR would expose them to a massive debt burden, the highest CASM in the industry and a workforce whose bad morale has become the suff of folklore (bags dumped in the river anyone?). I'll bet if this deal goes through they'll be some nice bonuses and golden parachutes for mgt.
Best of luck to all concerned.

It's too early for me to be drinking, unless that was just a slam on us cactus guys

Make no mistake I am not praising AAA mgt it's because of them that they in this mess. Most of that debt is in bad leases which all suspect would disappear with the parking of 60 airframes. Now as for their CASM and RASM, one would think that those too would come in line with what we now have. Morale well?? Well if done correctly and presented to the workforce that this is a new company with new ideas and opportunities it can be pulled off!!! No CEO and upper MGT types worth their salt would ever enter into a deal of this magnitude with golden benefits!!! If I were them I would be looking to do the same. This ain't personal it's all business and that's just the way of the world. We may not like it but given the same opportunities we ALL WOULD DO THE SAME THING...

Fly safe out there.

WD.

 

[ivauir]

It's too early for me to be drinking, unless that was just a slam on us cactus guys

I would never do that - really. My comment was inspired by your avatar and the fact I just was having trouble understanding your post; things like "can" where you probably meant "can't". Your sencond post clears it up for me, thanks.
I still think Cactus would be smart to stay away from USAir, but there is a really good readon I'm not paid to run an airline .... best of luck.

 

[Wiskey Driver]

I would never do that - really. My comment was inspired by your avatar and the fact I just was having trouble understanding your post; things like "can" where you probably meant "can't". Your sencond post clears it up for me, thanks.
I still think Cactus would be smart to stay away from USAir, but there is a really good readon I'm not paid to run an airline .... best of luck.

Never even thought about my avatar!! That is from my days with Air Wisconsin hence Wiskey Driver. Sorry I guess I am just a little too wound up today.

WD.