Not so fast AirTran

[Jetjockey]

Just saw a news conference with Mayor Daley (Chicago Mayor). It appears that the transfer of gates at MDW is far from a done deal. The concern is no one from AirTran, or ATA has even made presentations to the city of Chicago, the one who owns the gates. It gets more interseting. ATA had made a deal to build a $100 million training facility. The promise made by ATA was to provide over 1,100 new jobs. The city and state purchased the land with airport bonds, with an agreement to lease it back to ATA. Now that it appears that over 3,200 chicago jobs will be eliminated by the AirTran / ATA deal. That does not seem to sit well with city hall. Daley was quoted as saying preserving jobs was a very important aspect to the approval. He wants guarentees of jobs for ATA employees. Someone must have forgotten Chicago is democratic city. Don't underestimate Daley.........he bulldozes entire airports over night!

This is not a one pony race (AirTran). I'd watch for other offers from America West, as well as the pony everyone has forgotten about (SWA). They have enough cash to sqaush any offer, and keep another airline from gaining a beachhead in a market they could easily dominate.

Good luck to everyone involved.

 

[AA717driver]

Daley is a thug. Like father, like son.TC

 

[jetblue320]

Just saw a news conference with Mayor Daley (Chicago Mayor). It appears that the transfer of gates at MDW is far from a done deal. The concern is no one from AirTran, or ATA has even made presentations to the city of Chicago, the one who owns the gates. It gets more interseting. ATA had made a deal to build a $100 million training facility. The promise made by ATA was to provide over 1,100 new jobs. The city and state purchased the land with airport bonds, with an agreement to lease it back to ATA. Now that it appears that over 3,200 chicago jobs will be eliminated by the AirTran / ATA deal. That does not seem to sit well with city hall. Daley was quoted as saying preserving jobs was a very important aspect to the approval. He wants guarentees of jobs for ATA employees. Someone must have forgotten Chicago is democratic city. Don't underestimate Daley.........he bulldozes entire airports over night!

This is not a one pony race (AirTran). I'd watch for other offers from America West, as well as the pony everyone has forgotten about (SWA). They have enough cash to sqaush any offer, and keep another airline from gaining a beachhead in a market they could easily dominate.

Good luck to everyone involved.

I don't suppose JB would be interested.....Naaaahhh, not Chicago.

 

[MedFlyer]

If Daley demands that all ATA employees get jobs in the transaction, then its likely that no one will take the gates. Neither WN, HP, FL or anyone else want to hire all those extra employees. They might take some, but I doubt they will take them all.

It's nothing personal against the ATA employees. I'm sure they are hard working good people. But the purpose of these asset purchases is strategic growth and creating a more efficient network. The airline industry exists to transport people around...it's not a federal/state/local jobs program.

 

[Jetjockey]

I don't think anyone believes that the airline industry is a jobs program. Whichever airline takes over, it will need new employees. Why screw the present hard working one already at ATA? I think that is what the mayor was driving at.

 

[FLB717]

The number of jobs will not decrease by much no mattter who buys part nor all of ATA. The jobs willl/would transition from one uniform to another. Mostly.

Either way it sucks for the folks at ATA.

 

[General Lee]

Looks like HP may be interested in the whole ATA, and maybe that would include some jobs.....



America West May Bid for Troubled ATA
Wednesday October 27, 6:52 pm ET
By Ken Kusmer, AP Business Writer America West Airlines Says It May Still Bid for ATA, Which Filed for Bankruptcy Protection


INDIANAPOLIS (AP) -- America West Airlines Inc. said Wednesday it may still be interested in buying ATA Airlines, a day after discount carrier ATA filed for bankruptcy protection.

"We're looking at it. We may still be interested. We may continue to work on an offering. We think a potential America West proposal may be more desirable for (ATA) creditors and employees," America West spokeswoman Janice Monahan said Wednesday. She said America West had held talks with ATA recently, but did not make a formal offer.

On Tuesday, ATA filed for Chapter 11 bankruptcy protection and said it would raise $87.6 million by selling its Chicago hub and other airport slots to AirTran Airways Inc.

ATA founder and chief executive George Mikelsons' pledge to reporters Tuesday to "recreate ATA as a formidable, low-cost carrier" had barely left his lips when America West Airlines indicated it remained interested in making a bid for most, if not all, of ATA.

An AirTran spokesman conceded that ATA's plan to remain independent, albeit considerably smaller, with the cash infusion could hit turbulence in bankruptcy court.

"We expect there will be other people with some type of proposals," spokesman Tad Hutcheson said from AirTran's hub in Atlanta.

AirTran, based in Orlando, Fla., has agreed to take over ATA's flight operations, 14 gate leases and routes at Chicago Midway Airport, as well as arrival and departure slots at New York's LaGuardia Airport and Ronald Reagan Washington National Airport.

However, that deal and any other restructuring of ATA must win the approval of the U.S. Bankruptcy Court in Indianapolis and a majority of its creditors. It also needs approval from the Chicago Department of Aviation, which regulates the Midway gates.

"There were many people interested in what we had to offer," Gil Viets, ATA's newly appointed chief restructuring officer, said in a teleconference with reporters Tuesday night. "The relationship we're going to establish with AirTran is the one that looked like it would offer the best opportunity."

Acquiring ATA's Chicago operations would give AirTran a second hub after Atlanta, Hutcheson said. AirTran now has just one flight to Chicago.

"We believe that the proposal that we presented and that ATA accepted is the best deal for ATA, AirTran and the city of Chicago," Hutcheson said.

ATA's 3,200 employees in Chicago would not be guaranteed jobs with AirTran, which now has just 50 employees in Chicago, but the Florida-based carrier will "look favorably" on them, Hutcheson said. "The (ATA) employees know the market well, the airport and the customers," he said.

Representatives of the unions representing ATA flight attendants and aircraft mechanics have issued statements expressing concerns over the bankruptcy filing and its impact on jobs.

Airline industry consultant Michael Boyd said ATA's bankruptcy filing could set off a bidding war for the Midway gates, but AirTran's offer could emerge as the best for every party directly involved.

"The offer that's been made is probably the best they're gonna get," Boyd said Wednesday from his office in Evergreen, Colo.

"This is an incredible deal for everybody. It's good for ATA, it's good for the shareholders, it's good for Chicago and it's good for Indianapolis. And it's a very good deal for the creditors," Boyd said.

Hit hard by rapidly rising fuel costs, America West reported a third-quarter loss of $47.1 million on Wednesday. In trading Wednesday, shares of America West's parent company America West Holdings Corp. closed down 7 cents, or 1.6 percent, at $4.36 on the New York Stock Exchange. The stock has fallen more than 60 percent since the beginning of the year.






Bye Bye--General Lee

 

[AAflyer]

Interesting, I just read that AWA lost money this quarter (41 million) or almost $1.30 a share. They also said they would lose more money in the 4th quarter.

There cash position is OK, but to be buying companies, or assets now may not be the best idea. That is the thinking of the legacy carriers.

The legacy airlines have rapidly expanded, purchased other companies when they should have saved cash, etc, etc. Watching the LCCs start to copy the faults of the legacy carriers is amusing.

Then again, history has a strange way of ALWAYS repeating itself.

GOOD luck to the guys and gals of ATA. Wishing you all the best.

AA

 

[njcapt]

Daley is a thug. Like father, like son.TC

Yeah, but he's OUR thug. Significant point.

 

[atrdriver]

Yeah, but he's OUR thug. Significant point.

You can have him...I'd rather have Shirley Franklin...wait..we do have her...