View Full Version : US Airways / American Merger



venture
08-13-2013, 09:03 AM
Felt this should have its own thread since it will have pretty wide implications on the state, especially Tulsa.

Today the DOJ filed an anti-trust lawsuit to block the merger. While I still think the merger happens, they'll just need to make more concessions. What those are is hard to say. I personally don't agree that US/AA should be forced to give up much of anything at DCA - which is where I'm sure this is coming from.

DOJ tries to block American-US Airways merger - CNN.com (http://www.cnn.com/2013/08/13/us/airline-merger-antitrust-lawsuit/index.html?hpt=hp_t2)


The merger "would substantially lessen competition for commercial air travel in local markets throughout the United States and result in passengers paying higher airfares and receiving less service," the Justice Department said in a news release.

Funny how we didn't see them try to block DL/NW, UA/CO, or WN/FL which all reduced competition. Over the span of a decade(ish) we've gone for a dozen or so major airlines and are nearing just 4 big boys with a few regional/national carriers left. The time to worry about consumer impacts died years ago.

HangryHippo
08-13-2013, 09:26 AM
Yep, I was surprised to see DOJ actually file against this and it certainly doesn't seem prudent given they've not blocked any other merger. So you think this actually gets resolved via additional concessions? If not, this could be a long, bumpy ride going through an anti-trust suit.

venture
08-13-2013, 09:49 AM
I just can't see how they can block this based on what they approved before. This combo has overlap on only 12 routes and they are relatively spread out. Hub coverage is pretty good too...

AA: JFK/LGA, MIA, ORD, DFW, LAX(ish)
US: PHL, CLT, DCA, PHX

The other combos...
UA: ORD, IAD, DEN, SFO, LAX(ish)
CO: CLE, EWR, IAH
Outcome: ORD, IAD, DEN, SFO, LAX, CLE, EWR, IAH - all saved for the most part

DL: ATL, CVG, SLC, LGA(ish)
NW: DTW, MSP, MEM
Outcome: ATL, SLC, LGA, DTW, MSP - CVG and MEM got axed. CVG was #2 for the longest time and a massive operation.

For US/AA many expect PHX to die and be offset with LAX. PHL has a good niche as an international connection point that JFK can't provide right now (without the AA/B6 code-share). CLT is a huge operation and the only real competitor in the southeast against ATL. MIA does great with connections going south to Latin America.

DCA is probably what it is all coming down to. They are going to want slots to be dumped by the combined carrier to open it up to more competition. However, the more slots that are given up - unfortunately - the more Small Hub and smaller classified (by the FAA/DOT) airports get dropped and more service to large trunk routes.

It is a fine like they are walking now. Of course I would love to see them grow as stand alone airlines, but allowing the last 2 mega mergers go through, as well as WN buying FL, just means it is going to be tough. Ideally at this point we should be see a new crop of start ups trying to grab market share and keep the big guys honest, but the cost of entry into the industry is just ridiculous now. California Pacific is still sitting out there with their first aircraft unable to get going. PeoplExpress had to go out an buy a small charter carrier to get a certificate to keep costs down, but they too still aren't operating scheduled services.

At point it seems we are on the path back to the old trunk carriers and then a rebirth of the local airlines (i.e. Central, Frontier, Mohawk, Allegheny, Lake Central, etc.) to start filling in the holes. Give me the freedom, backing, and a couple dozen ATR-72s/Dash-8 Q400s and I would have a field day in the market right now. :)

venture
08-13-2013, 10:05 AM
DOJ's response: USDOJ: Justice Department Files Antitrust Lawsuit Challenging Proposed Merger Between US Airways and American Airlines (http://www.justice.gov/opa/pr/2013/August/13-at-909.html)

State's that have joined to block the merger include Texas, Arizona, Florida, Pennsylvania, Tennessee, and Virginia and also DC.

bradh
08-13-2013, 10:22 AM
Man, that would be a huge blow to Phoenix to lose hub status. I guess if that's being thrown around it's just assumed that HQ is going to be in DFW, not PHX?

venture
08-13-2013, 10:36 AM
Man, that would be a huge blow to Phoenix to lose hub status. I guess if that's being thrown around it's just assumed that HQ is going to be in DFW, not PHX?

Plan from Day 1 is HQ will be in DFW. US Airways management team takes over, but they are all moving.

damonsmuz
08-13-2013, 11:13 AM
Very surprised by this, but it will pass through.

AMR's stock (OTC) has taken a 40% hit on this with all other airline stocks down.

bradh
08-13-2013, 11:44 AM
Plan from Day 1 is HQ will be in DFW. US Airways management team takes over, but they are all moving.

Is anything being left in PHX? I still have a lot of friends there who work for US. They've got a damned nice building on Tempe Town Lake

MustangGT
08-13-2013, 11:48 AM
Keeping DFW as the HQ hub was a foregone conclusion from the start. Fort Worth/Dallas/State of Texas would not have allowed the merger if DFW did not remain HQ. I forsee the conglomerate having to give up slots are various stations and a few other considerations. Eventually I suspect the DOJ will "approve" the merger after sufficient concessions are made.

venture
08-13-2013, 12:12 PM
Is anything being left in PHX? I still have a lot of friends there who work for US. They've got a damned nice building on Tempe Town Lake

Probably a focus city operation compared to what DL did to CVG and what MEM is...for now. Perhaps they should forget TX and AZ and move back into the "Crystal Palace" back in Crystal City, VA. Could help with the politicking. LOL


Keeping DFW as the HQ hub was a foregone conclusion from the start. Fort Worth/Dallas/State of Texas would not have allowed the merger if DFW did not remain HQ. I forsee the conglomerate having to give up slots are various stations and a few other considerations. Eventually I suspect the DOJ will "approve" the merger after sufficient concessions are made.

Scroll back up where the Attorney General of Texas is with the DOJ fighting to block this. The cities of Fort Worth and Dallas could have moaned and complained all they wanted, but at the end of the day what a city has to say on a merger like this is worthless. It also wouldn't have served any purpose since they are going to remain the largest hub for the combined airline.

I'm not sure exactly what slots everyone is expecting them to give up. The only ones that should be a target are those at DCA. People seem to forget than only a handful of airports in this country are slot controlled (DCA, LGA, JFK PM only, EWR, SNA and LGB). LGA is the next largest batch of slots but Delta is already far larger than a combined US/AA there since the US/DL slot swap a few years back. JFK isn't going to yield anything meaningful...no domestic airline wants to deal with JetBlue. So that eliminates much of the domestic slot options. Next would be international and LHR is the only one of value and the EU has already approved the merger.

I'm still 70% certain this goes through. If it doesn't, then a few regionals will be thrilled that they won't be gutted (Air Wisconsin).

bradh
08-13-2013, 02:31 PM
so will this merger in any way affect the Wright Amendment?

venture
08-13-2013, 03:03 PM
so will this merger in any way affect the Wright Amendment?

Wright Amendment is dead next year regardless. Love will still have restrictions on int'l flight and the max number of gates on field, but otherwise it is irrelevant.

damonsmuz
08-13-2013, 08:31 PM
So, after the announcement of the whole US/AA merger thing that happened today, time to look into the future and start playing some guessing games. If AA and USAir remain a standalone company, what type of new routes do you see coming to OKC? Or do we remain as is?

How bad does OKC/TUL need AA/USAir to merge? Or are we better off with no merger?

Anyone know where Oklahoma stands on this?

no1cub17
08-13-2013, 10:10 PM
As mentioned above it'll be truly shocking if this merger doesn't go through. I thought if anything UA/CO would get blocked/altered - given that it gives one airline control of several key business markets (New York, Houston, somewhat Chicago, San Francisco). AA/US is far more benign - DFW is a dominant operation but still smaller than IAH, PHL is inferior to NYC, AA has no real west coast "hub" (although they're sure building up LAX). Either way Oklahoma stands to do well - I'd expect at least one-two OKC-east coast routes opened up. Maybe not OKC-DCA but OKC-PHL/OKC-CLT should be doable. So in that way it would be a win. As for AA frequent flyers, not so sure.

venture
08-13-2013, 11:16 PM
If the merger dies...it'll be rough for OKC to get much. I want to think OKC has a change to get LGA and MIA eventually on AA, but I wouldn't hold my breath. US would need to regroup and start growing. The big problem with them is the lack of a mid continent hub. DFW would have fixed that (in respect to the US network) but without it there isn't much they can do. STL isn't fully recovered and WN is too big there now. MCI is the city airlines go to start ups and then die. ORD/MDW, DFW/DAL, IAH/HOU, and MSP are all taken already. OKC is too small. AUS *might* be able to do something, but too far south. I'm not sure if MEM is really worth going after.

If it goes through...I feel CLT is a lock and possible PHL, LGA, and MIA eventually.

venture
08-23-2013, 06:54 AM
US and AA have filed a motion to get in front of the court and plea their case. The earliest that is going to happen will be November 12th. The merger agreement expires at the end of November so either carrier can walk away if this isn't resolved by then.

no1cub17
08-27-2013, 01:43 PM
I *hope* AA walks away. The last thing we need is for AA to become a LCC which is Parker's vision. No thanks. If only AA's labor force wasn't so pissed off at management.

venture
08-27-2013, 05:33 PM
I *hope* AA walks away. The last thing we need is for AA to become a LCC which is Parker's vision. No thanks. If only AA's labor force wasn't so pissed off at management.

Parker actually has said he intends to keep many of the premium products in tact. So he isn't going to take it the way he did US Airways when he got ahold of it. Sure there will be some changes to the product, but I wouldn't expect it to be horrible. Heck, all the US employees are getting pay raises as they snap up to current AA levels.

Personally I would rather they stay separate as well and grow internally.

MsProudSooner
09-05-2013, 10:15 AM
US and AA have filed a motion to get in front of the court and plea their case. The earliest that is going to happen will be November 12th. The merger agreement expires at the end of November so either carrier can walk away if this isn't resolved by then.

Aren't these things usually resolved by the carrier giving up some slots at the airports in question?

no1cub17
09-05-2013, 10:45 AM
Parker actually has said he intends to keep many of the premium products in tact.

People say lots of things. DL said they wouldn't dismantle MEM/CVG. Parker has to allay AA frequent fliers' fears that their airline is being turned into a larger version of Spirit. If you read the DOJ document they repeatedly quote US's execs openly discussing their disdain for things such as in-flight wi-fi, IFE, meals, etc.

I really think if AA's labor force didn't hate management so much they would go it alone. Will be interesting to see how this trial turns out. Bc I think it's obvious US needs AA far more than the other way around.

venture
09-05-2013, 12:17 PM
Aren't these things usually resolved by the carrier giving up some slots at the airports in question?

A lot of it depends on what they are going after. In this case it should just be DCA slots, but apparently they are wanting LGA slots as well which is uncalled for. Combined AA/US in LGA is still going to be much smaller than DL currently is, so that should be off limits. The DCA slot issue is one that will likely impact smaller markets since because they'll be the pawns in this game.


People say lots of things. DL said they wouldn't dismantle MEM/CVG. Parker has to allay AA frequent fliers' fears that their airline is being turned into a larger version of Spirit. If you read the DOJ document they repeatedly quote US's execs openly discussing their disdain for things such as in-flight wi-fi, IFE, meals, etc.

I really think if AA's labor force didn't hate management so much they would go it alone. Will be interesting to see how this trial turns out. Bc I think it's obvious US needs AA far more than the other way around.

Oh I agree. We all knew MEM/CVG were dead. I wouldn't be shocked that AA's domestic product gets changed some but internationally they are going to keep it relatively the same. US domestic vs. international is night and day right now.

damonsmuz
11-12-2013, 09:59 AM
Time to bump this thread back to the top... looks like the DOJ got what it wanted from US/AMR... and I expect that the 2 airlines will move very quickly on this merger.

With the slot give ups at DCA.... does it at all appear possible for OKC-DCA or does that seem dead now?

venture
11-12-2013, 10:23 AM
DCA - 52 slot pairs going back to the DOT and 8 pairs to be sold to the highest bidder. These are slots not reserved for small commuter service.

LGA - 17 slot pairs to be sold.

Giving up gates at LAX, ORD, BOS, DAL, LAX, and MIA.

WN & B6 get first opportunity to pick up the leased slots.

Existing hubs must be maintained for 3 years.


The Reagan National and LaGuardia slots will be sold under procedures approved by the department. Under the terms of the settlement, JetBlue at Reagan National and Southwest at LaGuardia will be given the opportunity to acquire the slots they currently lease from American. The remaining 88 slots at Reagan National and 24 slots at LaGuardia plus any JetBlue or Southwest decline to acquire will be grouped into bundles, taking into account specific slot times to ensure commercially viable and competitive patterns of service for the recipients of the divested slots. The parties will divest these slot bundles and all rights and interests in any gates and other ground facilities (e.g., ticket counters, baggage handling facilities, office space and loading bridges) as necessary to support the use of the purchased slots.

The gates at the five airports will be transferred on commercially reasonable terms to the new acquirers. The acquirers of the slot and gate divestitures also require approval of the department. Preference will be given to airlines at each airport that do not currently operate a large share of slots or gates.

venture
11-12-2013, 10:34 AM
Breaking things down a bit more...

Concerning LGA
- 5 slot pairs are owned by AA and leased to WN. WN has first right to purchase those outright.
- 12 remaining slot pairs will be sold/given back to the DOT.
- Overlapping service includes 5 daily LGA-CLT which makes those easy to cut. I would agree with what A.net is saying and that LGA-PHL (11 daily) gets cut back some.
- As far as OKC, I don't see this really hurting the chances overall at ever getting service, but I think it puts it way down the list for any operator.
- I think WN pushes to pick up the remaining 12 at all possible.

Concerning DCA
- 8 of the pairs owned by AA are leased to B6 currently and they have first right to purchase.
- 44 remaining pairs with 8 pairs currently overlapped between AA & US. 36 flights will be cut overall.
- Depending on who gets them will impact OKC's chances. Since these will likely go to B6 & WN, I think are chances are probably 10% right now unless things change.

no1cub17
11-12-2013, 01:05 PM
Time to burn the AA miles ASAP. I hope this isn't going to be as horrible as it seems for AA flyers, but I'm not holding my breath.

HangryHippo
11-12-2013, 01:21 PM
Time to burn the AA miles ASAP. I hope this isn't going to be as horrible as it seems for AA flyers, but I'm not holding my breath.

Why such doom and gloom over this deal? Can't be any worse than what Delta is doing to flyers.

I will be curious to see what happens to Tulsa as this progresses.

venture
11-12-2013, 02:18 PM
Yeah...Delta and United now are devaluing their FF miles. Southwest already announced a slight devaluation as well.

The days of spending 20k-25k miles and fly anywhere for free are long gone unless it is a system like WN that is based on dollar amount (and you catch them during one of their two big annual fare sales).

ljbab728
11-12-2013, 09:56 PM
Any changes by Delta are basically insignificant for coach class and very little change for business or first.

Travel From the U.S. & Canada | SkyMiles® Award Travel Mileage Charts | Delta Air Lines (http://www.delta.com/content/www/en_US/skymiles/use-miles/award-travel/airlines-and-mileage-charts/travel-from-the-u-s-canada.html)

Same for United. Basic coach class domestic awards are still the same.

http://www.united.com/web/en-US/content/news/United-Award-Chart-02-01-14.pdf

Of course, finding seats available is another issue. :)

venture
11-14-2013, 08:31 AM
Delta apparently feels they will get the 2 gates leased by AA in DAL (one is currently used by DL) by announcing 18 new daily flights from Dallas Love when the Wright ends in October.

damonsmuz
11-14-2013, 08:39 PM
2 gates/ 18 daily flights. Any idea what markets they will try to target out of DAL? I'm guessing OKC will def. not be one of them.

How much of a following does DL still have in North Texas? I used to try and fly non-rev out of DFW and it was next to impossible to do. When DL pulled their little hub out of DFW, many of the DL workers stayed in DFW and would commute daily.

Not sure if it's still like that anymore.

venture
11-14-2013, 09:25 PM
Umm...if I remember right it is LGA, CVG, MSP, DTW, and LAX. Pretty much just connecting to hubs.

I would think they still have a decent number of SkyMiles people from the old hub at DFW, but its been awhile.

damonsmuz
11-27-2013, 02:59 PM
AA/USair will merge next Weds. AA will exit bankruptcy that day as well.

Not sure how long the merging process will take but I assume that both companies started the merging details long ago.

And to Venture: the legacy of USAir will live as long as your avatar photo does :)

venture
11-28-2013, 08:05 AM
Not to mention on my display shelves with about two dozen USAir models. LOL

Ahhh...the good ol' days. Well...time to see what Parker does with the new AA.

http://cdn-www.airliners.net/aviation-photos/photos/3/7/5/0001573.jpg

Snowman
11-28-2013, 08:21 AM
...time to see what Parker does with the new AA.

I hope an early change involves a better paint scheme for the tails of AA

HangryHippo
11-28-2013, 08:43 AM
I hope an early change involves a better paint scheme for the tails of AA

Agree 100%

catch22
11-28-2013, 10:53 AM
I like it..

venture
11-28-2013, 04:32 PM
The AA livery has grown on me a bit, but I would like to see something more done with it.

I just hope all the retro planes get to stay and even more added.

venture
12-16-2013, 06:09 PM
AA and US employees started voting today on whether or not to keep the new American tail livery (only the tail is up to change). They can choose to keep it or revert back to the double AA with the eagle. I wish they had a none of the above option, but I don't have a vote. :)

Also Doug announced to them today that they will introduce a TWA heritage plane at some point soon, so that is awesome news there. They will also retain one in the US Airways paint scheme and the AA paint scheme prior to this newer one. They will be in addition to the PSA, America West (original and final scheme), Piedmont, and Allegheny liveries.

Existing heritage liveries in the fleet that will remain:

http://www.usairways.com/en-US/resources/images/aboutus/pressroom/plane_thumb16.jpg http://www.usairways.com/en-US/resources/images/aboutus/pressroom/plane_thumb12.jpg http://www.usairways.com/en-US/resources/images/aboutus/pressroom/plane_thumb11.jpg http://www.usairways.com/en-US/resources/images/aboutus/pressroom/plane_thumb5.jpg http://www.usairways.com/en-US/resources/images/aboutus/pressroom/plane_thumb4.jpg http://www.usairways.com/en-US/resources/images/aboutus/pressroom/plane_thumb14.jpg https://upload.wikimedia.org/wikipedia/commons/thumb/2/29/Aa.b777-200er.n781an.arp.jpg/180px-Aa.b777-200er.n781an.arp.jpg

Possibilities for future heritage liveries...

https://upload.wikimedia.org/wikipedia/commons/thumb/3/3c/AirCal_Boeing_737-200_N466AC_Marmet.jpg/180px-AirCal_Boeing_737-200_N466AC_Marmet.jpg https://upload.wikimedia.org/wikipedia/commons/thumb/a/a8/Air_California_Boeing_737-200_Silagi-3.jpg/180px-Air_California_Boeing_737-200_Silagi-3.jpg https://upload.wikimedia.org/wikipedia/commons/thumb/e/e8/Reno_Air_N823RA.jpg/180px-Reno_Air_N823RA.jpg https://upload.wikimedia.org/wikipedia/commons/thumb/5/5f/Convair_880_N830TW_TWA_ORD_24.04.71_edited-3.jpg/180px-Convair_880_N830TW_TWA_ORD_24.04.71_edited-3.jpg https://upload.wikimedia.org/wikipedia/commons/thumb/a/af/Trans_World_Airlines_Lockheed_L-1011-385-1-15_TriStar_100_Marmet.jpg/180px-Trans_World_Airlines_Lockheed_L-1011-385-1-15_TriStar_100_Marmet.jpg https://encrypted-tbn3.gstatic.com/images?q=tbn:ANd9GcQmF6VPHx2-ov99ovOifFTH4GdN-jC9fh7GIjSu154dnRZOG15s5w https://encrypted-tbn0.gstatic.com/images?q=tbn:ANd9GcSMmHCcnw4gKEpVgWrrhjGHQXkUAe3KH _AC4OzjJx7CffYdxUNX https://encrypted-tbn2.gstatic.com/images?q=tbn:ANd9GcQaha3li2vFKDAtKnRS9G3rE8hbz8yVN o96xHBsHAuCxHH3fddhCw https://upload.wikimedia.org/wikipedia/en/thumb/c/c3/Mowhak_Postcard_1970s.jpg/180px-Mowhak_Postcard_1970s.jpg https://upload.wikimedia.org/wikipedia/en/thumb/7/77/Mohawk_N1018C.png/180px-Mohawk_N1018C.png https://upload.wikimedia.org/wikipedia/commons/thumb/c/c6/Mohawk_N1122J.png/180px-Mohawk_N1122J.png https://upload.wikimedia.org/wikipedia/commons/thumb/e/e2/Douglas_DC-9-31_N976Z_Ozark_ORD_28.07.75_edited-2.jpg/180px-Douglas_DC-9-31_N976Z_Ozark_ORD_28.07.75_edited-2.jpg

Snowman
12-16-2013, 06:48 PM
I think the US Airways tail would go well with the rest of the AA livery

damonsmuz
12-16-2013, 07:48 PM
So basically these are the options here:

5452

In this case stick with the new tail. Otherwise you have 2 logos on a plane...an old logo and a new logo. The tail adds color.