US Air long term survivability

[flint4xx]

Inevitable failure or long term survival?

 

[boeingdriver213]

I think U will survive, although maybe not with the name USAirways. It wouldn't suprise me to see U and UAL merge. They seem to be working towards that , the way they are combining operations at many airports, code sharing, etc. My big concern in the event of a merger is, what happens to the guys on the street? Are we just out? Who knows?

 

[B190Captain]

I think U will survive, although maybe not with the name USAirways. It wouldn't suprise me to see U and UAL merge. They seem to be working towards that , the way they are combining operations at many airports, code sharing, etc. My big concern in the event of a merger is, what happens to the guys on the street? Are we just out? Who knows?

Where would the money come from? UAL and US are both broke!

 

[boeingdriver213]

I think if it came right down to it, the government would allow a merger in stead of losing the capacity of TWO major airlines, and I don't believe they would let a little thing like money (or the lack of it) stop a merger. They might however allow one to die, thinking that one less airline would allow the others to thrive. Being a furloughee from U, I would prefer to see U survive, even though I don't think I will get called back. UAL being a bigger airline would probably get more attention from the government though.

 

[FurloughedAgain]

You don't need money to merge -- though in reality US Airways cash position is quite strong right now.

A simple stock-swap could work. In essence you can buy an airline with its own equity.

While I would never subscribe to the Chip Munnian premise that UAL/USAir are destined for each other, I do believe that consolidation is inevitable.

The UAL/USAir merger was denied by the Government due to significant overlap. USAir is now roughly half the size it was in 2000. There is a much greater chance that a transaction would make it past the antitrust police.

 

[FurloughedAgain]

It is amusing to see people predicting the imminent demise of the airline though.

In late 98'/early 99' when US Airways was taking delivery of a new Airbus every WEEK and hiring over 100 pilots a MONTH people were falling all over each other to send an application and get an interview.

Nobody gave two thoughts to leaving AirTran to start class with USAir and Jetblue sounded more like an aftershave lotion than an airline.

Pilots are a fickle bunch. In 3 years the paradigm has completely changed.

 

[skykid]

Agree with FurloughedAgain. But U mgt (Wolfman) seemed to be convinced they had to make some radical changes to survive even before 9/11 - hence the ill-fated partner up attempt with UAL. I don't see a lot of difference in their situation now. U is in a tough market which will no doubt get tougher, and their route structure is not diversified. It is unbelievable to me that U mgt now says they need more cost cutting after rushing in and out of Ch11. With UAL in CH11 bankruptcy, I don't believe there is any legal possibility of a merger, and I hope current UAL mgt is not that stupid. I think Southwest coming to Philly is being way overplayed as far as some folks posting U's doom as a certainty, but it is a big deal. Obviously Southwest sees long term growth potential there, and that has got to make merging or acquiring U a lot less attractive.

 

[Heavy Set]

My bet is that Orenstien will target USAirways after a failed ACA bid... Watch out!

 

[Mr.B]

"Pilots are a fickle bunch. In 3 years the paradigm has completely changed."

True, and you can bet it will change again in 3 years. So, always have another skill-set ready. (IMO)

 

[typhoonpilot]

My Vote is for failure. I hope I am wrong for I have many good friends who work there. The sad reality is that their business model doesn't work and they are getting eaten away at by the likes of Southwest, Airtran, JetBlue, and others.

It is possible that some small portion will get bought or merged into another carrier but that will only save the top 1000 on the list at most.

The time to complete failure is hard to predict. They do have a decent amount of cash right now and the economy is recovering. The sad thing is they can't take advantage of an economic recovery because they outsourced too much flying and don't have enough wide body aircraft. Management in their tunnel vision zeal to cut costs has eliminated the ability to generate high revenue by slashing capacity.

USAirways will limp along like Pan Am, Eastern, and TWA before them until another significant event finally pushes them out of business. The downward spiral started with the Piedmont merger when Ed Colodny paid too much for Piedmont in order to avoid a hostile takeover from Carl Icahn. That didn't have to be the beginning of the end, but then the buyer ( USAir ) tossed out all the good Piedmont management so they could focus on their " cool Northern efficiency ".

No use crying over spilt milk though, I've already moved on and won't ever go back again.

Typhoonpilot