Tail Gunner Joe
Well-known member
- Joined
- Apr 22, 2005
- Posts
- 203
http://www.glgroup.com/News/Continental-Airlines-Calls-Merger-Shots-47965.html
Both US Airways and United Airlines have danced around the merger flagpole for so long, that any talk of combining with another party generates as much laughter as it does enthusiasm. Make no mistake, both of these airlines are inefficient dinosaurs who thank their existence today on Chapter 11, and not because of the people running their dilapidated businesses.
Continental Airlines doesn’t need to merge – staying solo has given them better access across the North Atlantic due to the Open Skies treaty and it remains one of the few U.S carriers generating increased passenger revenue against a softened high yield market.
US Airways has for years been a “me-too” airline – like United, both are eloquently mismanaged, have truly awful products (rubbish, in fact) in contrast to Middle East and Asian airlines and have about as much appeal in the merger stakes as AOL and Time Warner did – and we know how that vaunted merger turned out, didn’t we?
Continental Airlines is the holding all the cards here. It doesn’t “need” to merge with anyone as much as United Airlines and US Airways need to – given the latter two airlines weak financial positioning, inability to compete with more efficient low cost and intercontinental rivals means they are easy pickings for anyone adept enough to consume and remove a weaker rival.
United Airlines may look more favourable at getting a deal done somewhere, with someone, but US Airways is already on the road to this history books. Would AMR American Airlines entertain a buyout of this useless entity? Probably not.
Would anyone else?
Who is to say Continental Airlines won’t make a predatory move on US Airways if talks with United Airlines break down?
There is far less overlap between those two than if it went along with United Airlines.
Although the issue of a predominantly Boeing fleet at Continental Airlines versus a big Airbus fleet at US Airways may present a cost challenge, Continental Airlines can sit back and cherry-pick its next move.
United Airlines and US Airways will just have to hope that somewhere out there, someone will come to their rescue – if at all.
Both US Airways and United Airlines have danced around the merger flagpole for so long, that any talk of combining with another party generates as much laughter as it does enthusiasm. Make no mistake, both of these airlines are inefficient dinosaurs who thank their existence today on Chapter 11, and not because of the people running their dilapidated businesses.
Continental Airlines doesn’t need to merge – staying solo has given them better access across the North Atlantic due to the Open Skies treaty and it remains one of the few U.S carriers generating increased passenger revenue against a softened high yield market.
US Airways has for years been a “me-too” airline – like United, both are eloquently mismanaged, have truly awful products (rubbish, in fact) in contrast to Middle East and Asian airlines and have about as much appeal in the merger stakes as AOL and Time Warner did – and we know how that vaunted merger turned out, didn’t we?
Continental Airlines is the holding all the cards here. It doesn’t “need” to merge with anyone as much as United Airlines and US Airways need to – given the latter two airlines weak financial positioning, inability to compete with more efficient low cost and intercontinental rivals means they are easy pickings for anyone adept enough to consume and remove a weaker rival.
United Airlines may look more favourable at getting a deal done somewhere, with someone, but US Airways is already on the road to this history books. Would AMR American Airlines entertain a buyout of this useless entity? Probably not.
Would anyone else?
Who is to say Continental Airlines won’t make a predatory move on US Airways if talks with United Airlines break down?
There is far less overlap between those two than if it went along with United Airlines.
Although the issue of a predominantly Boeing fleet at Continental Airlines versus a big Airbus fleet at US Airways may present a cost challenge, Continental Airlines can sit back and cherry-pick its next move.
United Airlines and US Airways will just have to hope that somewhere out there, someone will come to their rescue – if at all.
