U.S. Airways trying to buy Delta

[Rottweiller]

Mergers and buyouts seem to be as big a part of the PAX industry as the airplanes themselves. Looking at the past 40 years:

Pan Am and National
Mowhawk-Allegheny
USAir and Piedmont
USAir and PSA
USAirways and America West
TWA and Ozark
North Central-Southern-Hughes Airwest (Republic)
Northwest and Republic
Delta and Western
Delta and Northeast
Southwest and Morris Air
Continental-Frontier-PeoplesExpress-New York Air
American and AirCal
American and Reno Air
American and TWA

Missed UAL's purchase of Air Wisconsin Airlines.

 

[lowecur]

But in the same breath he also states that it creates the most revenue in the whole of the US system.

My guess is NE international will be moved to JFK. Doug will like nothing better than sticking it to Jetblue ops at that Airport. He will be forced to give up many gates at LGA to satisfy DOJ.

PHL will see mostly O&D with North South connecting traffic being split between ATL/CLT. ATL will be the primary fortress hub in the East with a large international presence along with continued feeder operations for both north/south & east/west operations.

imp:​

 

[Kaman]

I think that this merger will lead to an overall reduction in cpacity with less flights to some city pairings operated with larger, more efficient aircraft (787) and/or a 737NG mk.II using more composite construction. Could this be the end of RJ mania? It would make sense from a cost point of view to have more larger aircraft flying with more seats, and perhaps a return to more turboprop feeder operations, again using new techology.
Is it possible that we may be seeing the beginning of a re-invention of the wheel in the airline industry. The airlines have been plagued by over-capacity and low yields per seat mile for years. Long before 9-11 the current paradigm has been obsolete, and consolidation is long overdue. Of course, the employees and the flying public will suffer in the process as the airlines spasm toward some as yet unknown "new order" for the 21st century.

Regards,

ex-Navy Rotorhead

 

[lowecur]

In my opinion, CVG stays. You have to remember why it exists: They can't fit enough people through ATL. The only city that would come close to replacing it is PHL, and it has the exact same problem as ATL. Pittsburgh has been LCC'd, and tons of midwesterners will still go through CVG just to avoid ORD (or ATL). If that happens, then CLT gets a trimming. Comair is history.

SLC is the biggest target, but Skywest will not be a loser. Remember that they've got a contract signed which would move them to the carrier(s) without a contract, Comair and Chautauqua. Comair is the big loser here, and may once again face liquidation just because they won't need RJ's.

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.

imp:​

 

[TWA Dude]

Okay folks, remember when UAL and USAirways tried to merge as part of the deal some routes would be shifted to AA? The only way I can see US-DAL getting approval is with a massive deal involving UAL, CAL and AA also picking stuff up. It makes the brain hurt.

And dammit, why can't AWA merge with somebody with a base near my home!

 

[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!