Should ALPA National Oppose a DL/US Merger?

[Noserider76]

A DL/US merger with a ton of overlap would result in many routes, facilities, and aircraft being divested. The prime beneficiaries would most likely be non-ALPA carriers, SWA, B6, Airtran. Basically a transfer of routes from ALPA to non-ALPA carriers. The new ALPA chief, Capt Prater, has stated he wants to bring back a strong, unified national union. What better place to start than a national campaign to eliminate job transfers to non-ALPA carriers? Carriers, you can argue, that were a large contributor to the demise of the payscales and benefits ALPA had built up over many years.

 

[ultrarunner]

While all that may be true, it really doesn't matter. When you enter BK, it's about a plan to get the investor a return on their money. And a BK judge isn't gonna give two $hits about who's gonna fly between two city pairs. The judge's responsibliity lies with getting the creditor their money, and I can tell you that the creditor doesn't care about much of what you said either. It's just the way it is when you get into BK.

 

[Noserider76]

While all that may be true, it really doesn't matter. When you enter BK, it's about a plan to get the investor a return on their money. And a BK judge isn't gonna give two $hits about who's gonna fly between two city pairs. The judge's responsibliity lies with getting the creditor their money, and I can tell you that the creditor doesn't care about much of what you said either. It's just the way it is when you get into BK.

From a purely financial aspect, I agree, but the political arena is where this will face some very serious challenges. Aside from lobbying, there are many things that can be done. Large corporations, such as DL's creditors, and the facilitating financial institutions, do not like the negative exposure that large groups of organized labor can create.

 

[A350]

The only "wrinkle" in your plan is that a large percentage of those "job transfers" are ALPA furloughees.....

And every concessionary contract was signed, sealed, and delivered courtesy of ALPA MEC's and ALPA National.

Think before you speak.

A350

 

[Noserider76]

The only "wrinkle" in your plan is that a large percentage of those "job transfers" are ALPA furloughees.....

And every concessionary contract was signed, sealed, and delivered courtesy of ALPA MEC's and ALPA National.

Think before you speak.

A350

Don't see your point at all. ALPA should be concerned about the jobs of furloughees who have chosen to go to a non-ALPA carrier? If they want to return to the employer that furloughed them, more ALPA jobs is the answer, not less. If they don't, they are on their own. ALPA wants to rebuild the profession. That means more jobs for ALPA carriers. If you are furloughed from US, I can't see this merger doing anything to help you. It will cut jobs, aircraft, and facilities, creating fewer pilot jobs overall, as Parker tries to achieve the synergies in his plan. The best thing would be internal growth at your own carrier.

You are right that ALPA signed every concessionary deal. That is a big part of the reason for the leadership change. The new guy seems to want to aggressively get back what was lost. The time to start is now.

 

[A350]

Another great post.....

Are you serious? Another ALPA pilot, who kept his ALPA-carrier job, basically saying a less fortunate ALPA pilot should have went to work at Home Depot instead of trying to provide for his family at a non-ALPA carrier.

Last time I checked, I am still a member of ALPA in good standing...just furloughed. Gave 18 years of dues to the organization. You are right, they should just cut us all loose. Further, perhaps trying to get us to join the ranks of ALPA would be preferable to trying to set up an us vs. them mentality.

At this point, going back to my ALPA carrier would be a pay CUT, so you won't see that any time soon.

Tool.

A350

 

[Noserider76]

Another great post.....

Are you serious? Another ALPA pilot, who kept his ALPA-carrier job, basically saying a less fortunate ALPA pilot should have went to work at Home Depot instead of trying to provide for his family at a non-ALPA carrier.

Last time I checked, I am still a member of ALPA in good standing...just furloughed. Gave 18 years of dues to the organization. You are right, they should just cut us all loose. Further, perhaps trying to get us to join the ranks of ALPA would be preferable to trying to set up an us vs. them mentality.

At this point, going back to my ALPA carrier would be a pay CUT, so you won't see that any time soon.

Tool.

A350

Tool...nice. I agree, great band. Still don't see your point, though. Do you think ALPA should help create jobs at B6 because you are an ALPA member in good standing currently working at a non-union carrier? Do you think we should not fight the removal of jobs from current ALPA carriers in the hope that you guys will somehow join ALPA? Protecting the jobs of current ALPA pilots would be a much better way to convince non-ALPA carriers of the benefits of the union.

 

[General Lee]

While all that may be true, it really doesn't matter. When you enter BK, it's about a plan to get the investor a return on their money. And a BK judge isn't gonna give two $hits about who's gonna fly between two city pairs. The judge's responsibliity lies with getting the creditor their money, and I can tell you that the creditor doesn't care about much of what you said either. It's just the way it is when you get into BK.

I don't know about ALPA national, but DALPA can oppose it because we are an actual unsecured creditor on the unsecured creditor committee. ALPA national could probably make a statement or two, but that is about it.

It does sound like Dalpa has the ability to affect this takeover in two ways---on the committtee voting NO, and using our PWA with the provisions to block code shares etc--which is what would happen initially since merging the certificates takes time. Regardless, the DOJ won't let it get that far. And if for some chance it does, NWA will be there for a merge.


Bye Bye--General Lee

 

[A350]

Nose:

You assume that any merger will benefit the non-union carriers.....excuse me non ALPA carriers.

I notice you conveniently left out AMR in the discussion. IMO,they would be the highest bidder for the shuttle.

For the record, airlines like AirTran, JetBlue, and SWA don't need mergers, carveouts, or job losses at union carriers to grow and make money.

Further, ALPA has seen the loss of thousands of ALPA jobs and they have been given to thousands of new hires at ALPA regional carriers....so ALPA will do what benefits ALPA.

A350

 

[A350]

General:

I am a little curious...why do you think a merge with NWA will be better? Not much better fleet match, hubs that are still too close together, and perhaps not so much route overlap but serious issues nontheless.

Not to mention an entire maintenance staff that comprises of replacement workers that crossed a live picket line to get a job.

A350

 

[Noserider76]

Nose:

You assume that any merger will benefit the non-union carriers.....excuse me non ALPA carriers.

I notice you conveniently left out AMR in the discussion. IMO,they would be the highest bidder for the shuttle.

For the record, airlines like AirTran, JetBlue, and SWA don't need mergers, carveouts, or job losses at union carriers to grow and make money.

Further, ALPA has seen the loss of thousands of ALPA jobs and they have been given to thousands of new hires at ALPA regional carriers....so ALPA will do what benefits ALPA.

A350

OK. AMR also. Why not fight the handing over of ALPA jobs to the APA? I realize the carriers you mention don't need mergers to grow but the costs of the legacies have come down to make it a much more level playing field now. Why hand them ALPA jobs on a silver platter?

As for your last point, we could talk all day about the things ALPA has and hasn't done and the mistakes that have been made. There is new leadership now that wants to change some of the things that have gone wrong. I propose a stand against this poorly thought out merger as a start. DALPA has come out strongly against it and they were in the room when Parker briefed his plan to the creditors.

I can't answer for GL but my thought is that a DL/NWA merger would be much better also. Almost no overlap will most likely result in far fewer job losses, and would create an airline with global coverage not so subject to problems that may occur in particular areas of the world. The route structures almost could not be more complimentary with the exception of both carriers weak west coast presense.

 

[General Lee]

General:

I am a little curious...why do you think a merge with NWA will be better? Not much better fleet match, hubs that are still too close together, and perhaps not so much route overlap but serious issues nontheless.

Not to mention an entire maintenance staff that comprises of replacement workers that crossed a live picket line to get a job.

A350

I agree with this quote:


By contrast, analysts believe that a Delta-Northwest combination would be far stronger: By matching Delta's strong European network with Northwest's powerful Asian routes, the combined carriers would potentially be more profitable than a combined Delta-US Airways. Vaughn Cordle, CEO and chief analyst of AirlineForecasts, a Washington (D.C.)-based consulting firm, estimates that a Delta-Northwest combination would have a fair market value approaching $12 billion—or $500 million higher than that of a combined Delta-US Airways. "A merger between Delta and Northwest makes the most sense," says Cordle. "It would produce more value than any other partnership out there, more than United-Delta, US Airways-Delta, or even United-Continental."


I think it is a better deal than the US offer, and it would preserve jobs and routes.


Bye Bye--General Lee

 

[A350]

General:

Is that all you got? A quote from Cordle? Scary!

A350

 

[General Lee]

General:

Is that all you got? A quote from Cordle? Scary!

A350

Are you serious? You obviously haven't been reading my posts in the last week or so. I could find you PLENTY of reasons why I would rather have NWA partner with us than US, but I posted the quote to make it easier for you.


Bye Bye--General Lee

 

[A350]

General:

I read a lot of the posts on here and have read plenty of yours.....and usually you have something of value to say....which is why I was so shocked that you would quote Cordle.

Secondly, you completely danced around the mechanic and fleet issues.

A350

 

[CaptBud330]

It seems either I am older then most on this board or have a better memory (not likely). I remember after Eastern failed, gates were available in PHL. Allegheny wanted them but so did Midway. ALPO came out opposed to Allegheny and put it's then considerable influence behind Midway. Now not to be too picky, but at the time, I was still paying dues to an organization that was directly opposed to my career advancement. ALPA is definately not looking out for you.

 

[A350]

Bud:

Perhaps it was because the then Midway MEC Chairman was an ALPA National Officer......politics at its best.

A350

 

[thruthemurk]

I think quite the contrary. If the industry merges back to 3 mega carriers each of them will be virtually impossible to do without and with strong national leadership perhaps we could reverse the plunge into the toilet that this profession has taken. Perhaps then the legacies could once again bargain from a position of strength vs fear.

ALPA national should endorse the merge - along with the inevitable followups if there new found focus is the profession as opposed to individual carriers.

 

[Doug Parker]

.

Let me be the first to mention OBERSTAR...............


What would be the chances of getting ALL aircraft with 70 seats or more onto mainline.



.

 

[General Lee]

.

Let me be the first to mention OBERSTAR...............


What would be the chances of getting ALL aircraft with 70 seats or more onto mainline.



.

Ober.... darn, you beat me to it!!!

Bye Bye--General Lee

 

[Bringupthebird]

I

agree with this quote:
By contrast, analysts believe that a Delta-Northwest combination would be far stronger:

If either one had any money backing such a deal, maybe it would be more than a pipe dream. But both airlines felt the need to extend the 9/11 crisis through bankruptcy. Well they did such a good job of creating a losing airline that they lost control of the situation. No money and no management credibility. Cooking the books just makes DAL look desperate.

Enter Parker and his bag of money. Sorry, but in this and many other situations, money talks.

 

[Occam's Razor]

Enter Parker and his bag of money. Sorry, but in this and many other situations, money talks.

Not always. In '98, DAL offered David Bonderman and Texas Pacific Group more for their equity (and controlling Preferred shares) stake in CAL than the competing NWA offer. Bonderman went with NWA's offer. In that instance, the CAL Board opposed the DAL offer based on issues such as governance, and which CAL management personnel DAL indicated they would retain after the sale.

Bonderman was later quoted, in a lengthy WSJ article on the transaction, that the NWA offer represented less $$ for him...but that it would keep his reputation intact in an industry that he intended to invest in over the next several years. [See: Qantas buyout underwritten by TPG in '06]

I think it's important to remember that only a couple of the unsecured creditors at either airline (NWA/DAL) are not long-term industry investors. (And those 4 are all banks that got blind-sided as part of a consortium holding notes in a revolving line-of-credit) All the other players are institutions that have demonstrated a commitment to backing airlines over the long haul. In my opinion that suggests they would favor a well-constructed deal that represented the "cleanest" (ie: least overlap) combination, with the greatest potential to increase the value of their equity.

 

[Noserider76]

Not always. In '98, DAL offered David Bonderman and Texas Pacific Group more for their equity ....

Thanks for the informative posts. It's appreciated.

 

[swa737-700]

A DL/US merger with a ton of overlap would result in many routes, facilities, and aircraft being divested. The prime beneficiaries would most likely be non-ALPA carriers, SWA, B6, Airtran. Basically a transfer of routes from ALPA to non-ALPA carriers. The new ALPA chief, Capt Prater, has stated he wants to bring back a strong, unified national union. What better place to start than a national campaign to eliminate job transfers to non-ALPA carriers? Carriers, you can argue, that were a large contributor to the demise of the payscales and benefits ALPA had built up over many years.

Nose,

Are you against the merger or non-ALPO carriers? ALPO sux and is powerless to unify the pilot groups they feebly represent. Since when was SWA, B6 and Airtran even considered in the "industry average" when the big ALPO boys went to the table with managment? Get real.

 

[Noserider76]

Nose,

Are you against the merger or non-ALPO carriers? ALPO sux and is powerless to unify the pilot groups they feebly represent. Since when was SWA, B6 and Airtran even considered in the "industry average" when the big ALPO boys went to the table with managment? Get real.

I'm definitely against this merger. I never said SWA, B6, and Airtran were industry standard when the cuts began. I think a factor in the "restructuring of pay and benefits scales", if you will, was the low cost, low wage carriers reaching critical mass, forcing the legacy carriers to come down to their wage levels. Many other factors were also responsible. I'm not complaining, it's the American way. My point with the post was that we need all guns pointed at this merger and ALPA National is a big gun. ALPA has a responsibility to preserve ALPA jobs. This merger serves as an agent to transfer ALPA jobs to other carriers, most of whom are non-ALPA.

 

[Tejas-Jet]

Bud:

Perhaps it was because the then Midway MEC Chairman was an ALPA National Officer......politics at its best.

Don't think he was yet an ALPA National Officer when all that happened.

Tejas

 

[A350]

I think he was.....MDW went gangbusters in PHL around the first gulf war....they went BK shortly thereafter. USAir ended up with the gates anyway.

A350

 

[Bringupthebird]

I think he was.....MDW went gangbusters in PHL around the first gulf war....they went BK shortly thereafter. USAir ended up with the gates anyway.

A350

No, he wasn't. He became one once he got hired at United. And his kid, too.

 

[stlflyguy]

My point with the post was that we need all guns pointed at this merger and ALPA National is a big gun. ALPA has a responsibility to preserve ALPA jobs. This merger serves as an agent to transfer ALPA jobs to other carriers, most of whom are non-ALPA.

Let a TWA guy tell ya', "Good luck."

stlflyguy:uzi:

 

[sgmick]

........