OK, SO who's next...

[Full of LUV]

DL/AK, DL/HA, DL/VA. I don't think a certain CEO wants to be trailing a couple of others. It could be all 3 of the above. Or, it could be none. AK is great where it is now with DL, but if someone tried to take away the LA/SEA feed, it might be a target. HA keeps expanding to Japan (Sendai announced today), and that may make it a valuable target. I know Dan says the Locals won't allow it, but you never know. Now that Inoywe is gone, it might be easier in DC. And VA could be cheap, Branson now is friendly with a certain management, it has same type planes, could needle UAL in SFO, and again would be cheap.


I can also see Frontier, JetBlue, Spirit, and VA doing combinations. I don't see SWA with anyone other than maybe Sun Country, just because they have the same planes and they could dig at DL more via the Humphries terminal at MSP.

All just a guess.



Bye Bye---General Lee

Didn't Richard just say DAL is not trying to buy HAL?
But seriously, HAL does not bring anything magical, if DAL wanted to fly HNL to AKL, they could announce service, hire some contractors in AKL and try and sell tickets. HAL is trying to get the non-stop Hawaii vacationer to fly on them, it doesn't produce large profits, but slow steady work that is a boon for the state of Hawaii as visitor levels have been at an all time high. Between the recession (actually slowing the rise of expense in HI), danger in Mexico, and AS and HAL step up in service, the pax to HI are at an all time high, but these are very price sensitive markets and the airlines know that, so just buying a bunch of metal and kicking off a flood of service to connect HI to the world isn't necessarily a printing press, otherwise others would be already doing it.
Aloha, LUV

 

[SAABaroowski]

It's a very good thing. I think NK will be reaping some serious benefits while everyone else plays merger roulette.

I'm hoping! Looking forward to some serious growth

 

[Dan Roman]

I hope not, but I think you are over-estimating the political clout of Hawaii. I think Inouye could get a lot of things done because of his seniority which gave him important positions on important committees. This is no longer true, the importance of this fact cannot be understated.

You are also implying by your statement that the state of Georgia does not have any significant political clout of it's own which will be working against you which I don't think you REALLY think.

Delta will have the advantage. To get the US government to stop Delta from buying Hawaiian will literally take an Act of Congress, as there is no legal reason that I can see for the federal government to intervene. Hawaiian will have to convince someone to pass a new law, or for someone at the justice department to really go out on a limb. Delta will just have to convince congress to do nothing...which really shouldn't be too hard in this political environment.

That all being said...I don't think HA will be bought by anyone in the near future, but if someone wants HA, and HA stockholders agree to be sold, I don't think there is anyone in any government that will have both the ability AND the desire to stop it. (although there will be plenty with one or the other)

I'm not saying Georgia doesn't have any political clout. I am saying they have very little in Hawaii. While the Federal level may be the most important, don't underestimate the local opposition and how strong or effective it would be. Essentially, the State of Hawaii is poised to reap huge benefits from what Hawaiian has planned over the next 7 years. I don't see that going away easily and any merger of HA with another carrier would do that.

But for you General, I will give you this......on the off chance there is a merger, I would say that by far the front runner would be Delta, it fits the best. Delta has an Asia route structure that fits, while AA would hardly benefit from a relatively small hub in Hawaii to Asia. But again, even Lee Moak was on record in Hawaii making a strong case that Hawaiian was important to the State of Hawaii as a stand alone carrier. It was in the news as well as in our pilot lounge.

 

[Dan Roman]

Didn't Richard just say DAL is not trying to buy HAL?
But seriously, HAL does not bring anything magical, if DAL wanted to fly HNL to AKL, they could announce service, hire some contractors in AKL and try and sell tickets. HAL is trying to get the non-stop Hawaii vacationer to fly on them, it doesn't produce large profits, but slow steady work that is a boon for the state of Hawaii as visitor levels have been at an all time high. Between the recession (actually slowing the rise of expense in HI), danger in Mexico, and AS and HAL step up in service, the pax to HI are at an all time high, but these are very price sensitive markets and the airlines know that, so just buying a bunch of metal and kicking off a flood of service to connect HI to the world isn't necessarily a printing press, otherwise others would be already doing it.
Aloha, LUV

Very well said. HA is successful as "Hawaiian". Like you said, their route structure with another name painted on the side of the airplane really doesn't bring that much to the table for anyone else. We just have found we can fill up airplanes flying to large cities with passengers that want to go to Hawaii on Hawaiian Air. We are not "kicking anyone's ass" nor are we going to take over the world. We are just flying vacationers to and from Hawaii. We have a loyal passenger base locally and provide a good product with efficient airplanes.

 

[Dan Roman]

So SWA abandons all that has made them different to acquire a mostly international airline that flies Airbi and 717's?

The far east and SWA? What part of their business model makes you think they are looking to expand in Japan / China. I can see it now, everyone in Narita with their boarding letters at the crack of dawn to get an "A" and fly from Tokyo to HNL with a soda and pretzels.

Anything is possible, but this would be the largest deprture from the SWA business model in history!
LUV

I couldn't have said it better myself. I really don't think too many of them actually believe SWA would consider it. I think a few may have overdosed on that "warrior spirit" though and actually think it could happen!

 

[Dan Roman]

In the spirit of this string I did find this on Motley Fool....so take it for what it's worth........

Alaska was one of five carriers highlighted last year by American Airlines as a potential merger partner . With American now apparently set to merge with US Airways (NYSE: LCC ) as early as this week, some industry observers think that the recent period of airline consolidation is over. However, Alaska is a small enough carrier that it could probably merge with any of the three major carriers without causing major antitrust problems. Moreover, the company's strong position in Seattle makes it a very attractive acquisition target, particularly for Delta. Alaska currently carries approximately 52% of passenger traffic at Sea-Tac Airport . Delta is a distant second, with 11% of the market. Alaska and Delta already have a codeshare partnership, which allows passengers to connect in Seattle between Alaska and Delta flights with a single ticket. Delta is using this partnership to build Seattle into a major international gateway . Delta already flies nonstop from Seattle to Paris, Amsterdam, Tokyo-Narita, Osaka, and Beijing, and the airline plans to begin service to Tokyo-Haneda and Shanghai later this year.
Acquiring Alaska would allow Delta to take even better advantage of Alaska's Seattle-based route network. Seattle is ideally located for flights to Asia, as it sits in the northwest corner of the continental U.S. Building a hub in Seattle could help Delta increase its market share in Asia, a market that is likely to experience higher growth than North America or Europe

 

[RNP.15]

Now watch LUV take Alaska off the board. Uncle Delta would sh^t.

 

[LearLove]

Now that's funny right there...

There are girls who have been around the block and then there are tour guides...

I like that. Good one.

 

[Dan Roman]

The big fish are out of the pond, the smaller exotic ones are next.

And if you keep telling yourself that "our "Niche market" will be safe", you're gonna be in for a rude awakening. Market share is market share!

KBB

If you think that then are you concerned that one of the big three will buy SWA? When you think about it, think of the domestic domination that would create. As you say Market Share!

 

[737tanker]

SWA/ALK - SWA gets nothing out of it they don't already have

Actually it would give SWA immediate access to Hawaii and it would get rid of a competitor in the western US. If you substitute Caribbean for Hawaii and eastern US for western US you have the same reasons that SWA bought AirTran.

 

[General Lee]

Didn't Richard just say DAL is not trying to buy HAL?
But seriously, HAL does not bring anything magical, if DAL wanted to fly HNL to AKL, they could announce service, hire some contractors in AKL and try and sell tickets. HAL is trying to get the non-stop Hawaii vacationer to fly on them, it doesn't produce large profits, but slow steady work that is a boon for the state of Hawaii as visitor levels have been at an all time high. Between the recession (actually slowing the rise of expense in HI), danger in Mexico, and AS and HAL step up in service, the pax to HI are at an all time high, but these are very price sensitive markets and the airlines know that, so just buying a bunch of metal and kicking off a flood of service to connect HI to the world isn't necessarily a printing press, otherwise others would be already doing it.
Aloha, LUV

You're probably right. The fleet types fit, and they have expanded a lot to Asia, but I guess DL could do that organically, but that means getting more widebodies, not just used narrowbodies. I hope that happens.



Bye Bye---General Lee

 

[General Lee]

Now watch LUV take Alaska off the board. Uncle Delta would sh^t.

I think they are looking at that possibility right now. I think RA has plans for everything, and he is probably the smartest airline CEO out there right now.


Bye Bye---General Lee

 

[Dan Roman]

Actually it would give SWA immediate access to Hawaii and it would get rid of a competitor in the western US. If you substitute Caribbean for Hawaii and eastern US for western US you have the same reasons that SWA bought AirTran.

While on one hand that could be their way into Hawaii, I'm guessing SWA only acquires bargains. AK would not go cheap and DAL would not sit idly by if they did try.

 

[scoreboardII]

Which is why if a SwA AK deal occurs, it will be a true merger, not a purchase.

 

[igneousy2]

Word on the street is that there were in talks when AS's stock price valued the company at <1B. When the value shot up, SWA backed out of the talks and bought Air Tran.

If it is true that our relationship with DL is souring to the extent that people on here are implying, then I think it INCREASES the chance of DL buying AS. If AS keeps whoring itself to all of DL's international competitors, the ability for DL to CX some of our code-shares might tip the scales enough for them to pull the trigger on the purchase.

Everytime we codeshare our US network with an international carrier, it diminishes the value of DAL's network (and UAL and US/AA's). Maybe the Iceland Air codeshare cancellation was done to apease Delta.