U.S. Airways trying to buy Delta

[SWAdude]

Holy consolidation Batman!!!

Many of us that have predicted the legacy consolidation didn't see this scenerio.

This is the first blink my friends. Take a look around you. The airline business is going to look different two years from now. Within a month I say there will be another merger announcement. Continental and United?

Best of luck to all of us.

 

[Contract]

I guess this means more REVISIONS in the Operating Manuals. We should all be issued our own personal assistants to keep up with the procedure changes. This is getting Crazy. FO "Seat Belt Sign Off. Verified." Capt. "Keep your hands off my Seat Belt Sign". FO but, but...Ok Verified, Hand off Seat belt Sign.

 

[bvt1151]

SLC stays if Doug wants to take pressure off PHX. Not familiar with SKYW contract, but lawyers will find a way to break it if SLC is not a part of the plan. Republic is probably a very big winner here.

Skywest's future does not necessarily depend on SLC. The deal with Delta made pre-bankruptcy included a clause that said if the contract is broken before the ammendable date (10-years I think) then Delta pays Skywest $125 million. To my knowledge, it says nothing about SLC, only gates in ATL. ASA is included in all of that.

Republic, Mesa, and Skywest all have the money to buy their way out of trouble. That leaves Comair. I'd fully expect to see Comair completely replaced in CVG and JFK by Republic and Skywest. Mesa done pi$$ed a bunch of people off, so they just might find themselves outside looking in.

As far as hubs, I think SLC takes the biggest hit, although Delta will still remain the biggest player in town, at least until Southwest gets enough planes. CVG has far too high a yield to let it go the way of PIT, and PHL is too far away and too messed up to affect CVG. Not to mention the loss of CVG would rid them of their furthest northwest operating hub besides SLC. You'd have nothing between PHL and SLC, which is a very significant market area, especially considering how people in that area are sick to death of ORD. ATL is obviously fine, but I'm not sold on CLT making it unscathed. It'll still be big, but it just doesn't make sense to have ATL and CLT both mega-hubs. Yields are high there, but yields at the hub airport don't affect ticket prices of the connecting pax. I'd expect smaller aircraft out of CLT to retain market share and O&D yield, and remaining connections going through ATL or CVG. LAS and PHX are powerhouses for Airways and connect everywhere West better than SLC except for Seattle/Portland area and SFO to a much lesser extent.

I get the impression you like talking route strategy. Keep it coming! Its nice to be able to toss ideas back and forth with someone who knows a thing or two about it.

 

[deadstick]

Does anybody else think that we'll be able to pick-up a bunch of surplus RJ's really cheap if this goes through?? Now multiply that by the number of pilots hired to crew each aircraft....

LCC already has $7.2B in financing secured...

If the other Legacy carriers follow this model in order to stay afloat, I guess you can increase the first statement 3 or 4 fold (just a guess)...

Oil is getting very close to $60/bl again...

Less competition --> higher ticket prices --> less pax...?

Would the new Delta still favor Boeing? LCC takes gulps from the Airbus koolaid fountain.

Many domestic routes would be consolidated, but this would give LCC access to Asia, South America, Africa...

Just some thoughts.
Fire at will.

 

[On Your Six]

USAirways and America West can't even integrate themselves very well (AWA and US pilots are not close to an agreement on integration). What makes them think that Delta would be easier to integrate if they have had such a hard time integrating what is on their plate today?

How many consultants, accountants and lawyers would be required to integrate that mess? I should have gone to Law School....

 

[BoilerUP]

Republic, Mesa, and Skywest all have the money to buy their way out of trouble. That leaves Comair. I'd fully expect to see Comair completely replaced in CVG and JFK by Republic and Skywest. Mesa done pi$$ed a bunch of people off, so they just might find themselves outside looking in.

Don't forget Piedmont and PSA, Air Wisconsin (who owns a chunk of LCC), Colgan, and TSA in the Airways side of the mix...

 

[bvt1151]

If you're going to go through merger nightmares, why not just get all your merging over at once?

 

[Cobraair75drvr]

I agree with the access to Africa, South America, however 1 ATL-NRT ain't sheet. Fully expecting the announcement of AA-NWA and the stapleing and ending of my career.:bawling:

 

[VeeOne]

Actually, I've heard Parker doesn't think too highly of the Airbus and is looking more toward the Boeing route. Wouldn't a nice Boeing order be nice in order to offload a bunch of now aging Airbus aircraft. New airplanes could, very well, be a strong shot in the arm regarding maintenance costs........

I bet Jetblue isn't too happy right now......I don't think Parker has too much of a liking for JB......

 

[80for80]

Since alot of Delta's senior pilots took early retirement, you know that the senior USAir boys are licking their chops thinking about flying their newly acquired 777s around the world!

 

[bvt1151]

Don't forget Piedmont and PSA, Air Wisconsin (who owns a chunk of LCC), Colgan, and TSA in the Airways side of the mix...

Yeah, Piedmont is fine. They've been shrunk into this nice little niche market. Same with Colgan. Air Wisconsin can pretty much dictate their own future. PSA may find themselves shoved together with Comair in a Piedmont/Allegheny type merger, but thats stretching it. Either way, they're clearly at risk. TSA is a crap-shoot, but I wouldn't do any investing there for a while. I don't think Republic will come out as sweet as they think in this. They're banking on a bunch of 70's for further growth, and none of that is going to be in the Airways colors. Parker's still honked off about the 170 sale to Republic. They may be able to pay to keep most of their 50-seat flying, but remember that they still have not signed a deal with Delta, which means only Skywest/ASA are guaranteed to remain. Republic's not screwed, but they're not going to grow much, if at all, in my opinion.

 

[80for80]

Imagine the sounds on the radio in ATL of "Catus xxx" in a southern drawl!!!

 

[Freight Dog]

Good deal!!! Consolidation is the only way to get our industry and profession out of this graveyard spiral. Consolidation means less choices, means more pricing power, means more money to be made.

Hey, it worked for the oil industry, banks, and it will work for the airlines.

 

[lowecur]

I get the impression you like talking route strategy. Keep it coming! Its nice to be able to toss ideas back and forth with someone who knows a thing or two about it.

Jetblue will probably get their next hub out of this deal. CVG or SLC both are within range of the 190 from either coast although CVG would suit their purposes better. Neeleman has roots in SLC, so that would be a reasonable target should CVG fall through. The other option is to wait until other mergers are on the table and see what happens. Either way, the next few years will be interesting to say the least.

I also see AirTran and Jetblue reinstating their order book to the previous delivery schedule if this goes through.

imp:​

 

[michael707767]

Good deal!!! Consolidation is the only way to get our industry and profession out of this graveyard spiral. Consolidation means less choices, means more pricing power, means more money to be made. .

its a false assumption to think that consolidation will mean more pricing power. It will likely mean just the opposite. If consolidation happens and the merged airlines pull back some capacity, you just open the door for new entrants to add that capacity right back. Then instead of competing with another major who has similar costs you are competing with a start up with rock bottom costs.

 

[80for80]

its a false assumption to think that consolidation will mean more pricing power. It will likely mean just the opposite. If consolidation happens and the merged airlines pull back some capacity, you just open the door for new entrants to add that capacity right back.

That would be a good thing for those of us still at the regionals. It would mean new LCCs for us to try and get on with and if we can't get on with them, then it means more potential regional feeder agreements with them.

 

[LearLove]

That would be a good thing for those of us still at the regionals. It would mean new LCCs for us to try and get on with and if we can't get on with them, then it means more potential regional feeder agreements with them.

your kidding, right???

 

[80for80]

your kidding, right???

No. If this merger goes through then it will mean furloughs at the majors and less oppurtunities for us at the regionals to get on with a legacy major. So, if a new bunch of LCCs start up as a result, then it's still somewhere we can go to get away from the regionals, as any LCC is better than any regional.

 

[AAflyer]

your kidding, right???

Yup, just look at his screen name. He is a flamer. If not, well we have met the enemy and he is us.

AA

 

[B727Driver]

I also see AirTran and Jetblue reinstating their order book to the previous delivery schedule if this goes through.

on another thought, any guesses on LCC's merging to combat these larger, combined legacy carriers? Frontier and AirTran have their new agreement.

AirTran may want to sell their rights to the 737, add the Airbus and use the new capital and join up with Frontier and JB to form a large,strong LCC. Survival of the LCC's as individual entities maybe short lived if the legacy carriers become profitable and dominate in key markets. They may just price the LCC right out of business or weaken them to a breaking point. Big money talks. Thoughts?