I read an article today on the Chicago Tribune that said CO's leaders (CEO, other top officials, etc.), will be the head of a merged company between United and Continental. This looks to me that Houston will keep an airline HQ (and Houston still has the regional carrier ExpressJet).Originally Posted by MisterNifty
No way to they put the HQ of a merged CO-UA airline in Houston. Chicago is a world class city, with the 2nd busiest airport in the world and more international influence. CO leaders may take the top jobs, but the HQ will be in Chicago.
At current levels, we are only talking about 350 people at recently moved United headquarters. http://www.united.com/press/detail/0,6862,54552,00.html
If they do merge with CO they might keep a "branch" office there, but the airline headquarters will be Houston.
"Liberalism: Moochers Electing Looters to Steal from Producers."
If CO is doing the buying, it'll be in Houston. Although given what I've read about these mergers, I doubt a UA-CO one goes through until the NW-DL merger happens. I know there are some "Golden Share" provisions with NW and CO that would first need to be solved before all of this could shake out.
No two ways about this, the headquarters for this potential new airline will be in Houston (assuming approval).
I don't see an AA-CO merger happening.
By the power of greyskull!
Anyone here with actual airline industry operations experience care to weigh in?
A wise man speaks because he has something to say; a fool because he has to say something. - Plato
British Airways, Iberia in combination talks
11:31 AM CDT on Tuesday, July 29, 2008
Associated Press
http://www.dallasnews.com/sharedcont...ia.b1c517.html
LONDON – British Airways PLC and Spain's Iberia SA said Tuesday they are in talks over a potential all-share combination.
BA and Iberia, which are long-term partners in the oneworld alliance, said that each would retain its branding under the tie-up.
The pair said the negotiations are supported unanimously by both boards, but did not disclose any financial details in a statement.
BA and Iberia have also been in discussions for several months with American Airlines to potentially form a trans-Atlantic joint venture, but they did not provide any immediate update on those talks.
BA Chief Executive Willie Walsh said airline consolidation is long overdue as the aviation landscape changes.
"The combined balance sheet, anticipated synergies and network fit between the airlines make a merger an attractive proposition, particularly in the current economic environment," Walsh said in a statement.
The pair said they expect it will take "several months" to reach agreement on the terms of the combination and to finalize a joint business and integration plan for the combined group.
...
Oneworld will go the way of Skyteam and eventually form something as close to one giant company as possible. BA-IB is the first step. Anti-trust immunity with those two and AA will be next and I wouldn't be shocked if BA eventually bought the maximum allowable share of AA when it has digested Iberia.
From what I'm hearing, the DFW-MAD flight should start next summer on AA. Subject to change, of course, but that seems to be the operating assumption in some parts of Centerport at the moment.
Associated Press
BA closes in on deal with American
By JANE WARDELL 08.04.08, 7:36 AM ET
LONDON -
British Airways PLC, which is already in talks with Spain's Iberia SA over a combination, said Monday it hopes to seal an alliance with its U.S. partner American Airlines within weeks.
BA spokesman Euan Fordyce said that the carrier expected final preparations for a deal to be completed within two weeks, and an application to U.S. regulators for antitrust immunity to be filed shortly afterward.
Full Story Here
"Liberalism: Moochers Electing Looters to Steal from Producers."
British Airways in merger talks with Qantas
By JANE WARDELL
AP Business Writer
http://hosted.ap.org/dynamic/stories...l&SECTION=HOME
LONDON (AP) -- British Airways PLC said Tuesday it is in talks with Australia's Qantas Airways Ltd. about a potential merger, sending its shares soaring as it confirmed expectations of consolidation in the hard-hit aviation industry.
BA, which is already pursuing a revenue-sharing deal with American Airlines and Spain's Iberia SA, said it is exploring a "potential merger" with Qantas "via a dual-listed company structure."
...
http://online.wsj.com/article/SB1252..._LEFTWhatsNewsThe Wall Street Journal
* SEPTEMBER 12, 2009, 6:16 P.M. ET
AMR's American, Japan Air in Joint Venture Talks
By MIKE ESTERL
AMR Corp., the parent of American Airlines, is negotiating with Japan Airlines Corp. to form a far-reaching joint venture, according to people familiar with the matter.
Fort Worth, Texas-based AMR also would be willing to invest hundreds of millions of dollars in financially struggling JAL to help seal a pact, these people added.
AMR has been in "intensive negotiations" with JAL for more than a month, according to one of the people familiar with the talks.
Tighten the female dog!
And then everyone else is talking about how Delta is looking to invest a sizeable investment in JAL. The interesting thing about these two stories is that they seem to not even notice each other. Delta is trying to invest in JAL and AA is trying to form a BA/AA/IB type merger with JAL. Nevermind both of these things can't happen.
Either way its played, DL and AA know that the Open Skies agreement with Japan is well on its way to being completed. AA/Oneworld can't stand to lose such a major player to DL/Skyteam.
...and now BA is throwing their weight behind keeping JAL one of the worst performing airlines in the world as part of Oneworld.
I suppose it's better to have one of the worst and great access to Japan vs having no Japanese alliance partner at all...
I am not sure what you mean? JAL's service is not bad they are a good airline. The problem with JAL is that it is saddled with the old style government flag carrie beaucratic labor and management. And I think the Japanese Govt still has a stake in the airline that prevents change. I do wish that AA flew to more countries in Asia besides Japan. It would definately give us more options for connections to other One World Airlines.
I agree. My experiences with JAL have been very positive. I meant that perhaps it's better to have a poor performing airline with great access to Japan and Asia vs. not having one in the alliance at all.
It's curious to me what's going on with airlines. Is it just me, or has there been a surge in airlines joining one of the three big alliances?
http://dallas.bizjournals.com/dallas...2/daily34.html
Dallas Business Journal - by Jeff Bounds Senior staff writer
AMR Corp., the parent of American Airlines, is talking with China Eastern Airlines about joining the oneworld Alliance, according to a published account.
Citing an interview with AMR's chief financial officer, Tom Horton, Reuters reported that AMR is also in "advanced talks" with a Brazilian carrier about joining oneworld.
While Horton did not reveal the name of the Brazilian airline, Reuters said the carrier is likely Gol Linheas Aereas Inteligentes SA, whose primary rival is part of a separate alliance of carriers called Star.
Officials of Fort Worth-based AMR weren't immediately available for comment Thursday afternoon.
In addition to oneworld and Star, the third large alliance among airlines is called SkyTeam. The groups are aimed at sharing revenue and cutting costs.
On Tuesday, Kingfisher Airlines of India said it was joining oneworld. Should Kingfisher get the required regulatory approvals, it will become the 12th member of oneworld.
Isn't there some date in the future, like in three of four years, from which it will no longer be illegal for a company in one country to own an airline operating in another? Something like that.... Delta cannot own Cathay, Cathay cannot own British Airways... you know.
It looks to me that we're seeing the transformation from Legacy Carrier to Super Carrier. The alliances have already set the stage for huge mergers, or at least a much more fluid revenue flow among partnered airlines.
The only airlines not participating in Airline alliances for the most part are Low Cost Carriers.
Cooperation with other airlines is not part of their business plan yet.
Yes, there has been a surge. It appears that a lot of airlines with an international focus are finding that these alliance area a great way to extend their reach (and for smaller, more regional carriers to capitalize on international traffic).
These things are determined on a country-by-country basis, for the most part. You might be thinking of the EU, which now allows carriers from one EU country to own carriers based in other EU countries.
The U.S. has a strong prohibition against foreign control of airlines and I don't see that being relaxed anytime soon. Virgin America was strongly attacked by existing domestic carriers when it started up operation in the U.S.
I think nationalistic tendencies and union opposition will serve to inhibit outright mergers, but I agree with you-- we will continue to see the economic ties between international airlines continue to strengthen.
A few notes:
-The whole experience with JAL highlighted how far behind oneworld is behind the other alliances. That's hard to see from DFW sometimes, but the alliance was a very distant third behind the others. The tide started to change when JAL decided not to bolt and the AA/BA/Iberia/Royal Jordanian/Finnair transatlantic antitrust immunity was tentatively approved. (which is HUGE for AA, and probably bad for the rest of us)
-The point of the alliances is to reduce expenses through what would otherwise be unfair collusion. The airlines will probably raise fares, while cutting back house expenses and gain additional revenue streams through onward connections that previously were more cumbersome to book. These immunities are GREAT for airlines (and hence why AA wants one across the Pacific with JAL) even if they're pretty crappy for the rest of us. Given the financial state of this industry, they don't really have any other choice.
-If AA can't buy or merge with Continental, they essentially have to grow with their own money and metal, or strengthen their alliance. The proposed additions to oneworld (at last count including all possible carriers: S7 (Russia), Kingfisher (India), China Eastern, GOL (Brazil)) are a manifestation of that plan. AA's purchase, or planned purchase, of new aircraft is another element of this plan.
-The repeal of the Bermuda II treaty a few years ago, which gave us DFW-LHR flights is actually a two-part deal. The first part, access to LHR, has been realized. The second part, which includes relaxation of foreign ownership restrictions of US carriers is set to come into effect soon. If it doesn't, the entire treaty can be repealed. We'll see if that actually happens. My hunch is that none of AA's alliance partners have the capacity or cash to buy a large chunk of AA. BA certainly couldn't without outside capital and until it has fully digested its proposed merger with Iberia.
These are interesting, if not necessarily good times for the entire industry. In 5 years, I think it will paradoxically look entirely different with fewer carriers and yet very familiar with big name carriers and the alliances surviving.
-
European regulators say American Airlines, partners have offered to give up London flights
09:44 AM CST on Wednesday, March 10, 2010
By TERRY MAXON / The Dallas Morning News
tmaxon@dallasnews.com
http://www.dallasnews.com/sharedcont...19407cc62.html
The European Commission said Wednesday that American Airlines Inc., British Airways and Iberia have offered to surrender enough slots at London’s Heathrow Airport to give competitors six additional flights a day to U.S. cities.
The proposal from the Oneworld partners seeks to overcome opposition to their planned joint business venture across the North Atlantic. Included is a request for immunity from European antitrust laws.
In their proposal, the partners would surrender enough slots to operate 14 flights a week to New York Kennedy; 14 flights a week to Boston; seven flights a week to Dallas/Fort Worth; and seven flights a week to Miami.
The carriers also agreed to let passengers on those competing flights earn miles in their frequent-flier programs.
In addition, the carriers would allow competing carriers to feed passengers to and from their own flights and to pro-rate the revenues from air fares.
...
The three carriers want antitrust immunity so they can jointly set fares, coordinate schedules, work together on marketing their flights, offer mileage in each other’s fare programs and otherwise cooperate.
Two other Oneworld members, Finnair Oyj and Royal Jordanian Airlines, are also part of the application for antitrust immunity.
...
This is great news! One of the major problems identified by both the U.S. government and the European Union in their individual reviews of the proposal was that it would actually be quite harmful to the DFW marketplace by essentially giving AA and BA a monopoly on the DFW-London route, leading to higher airfares and potentially less service.
Bizarrely, the DFW Airport Board and Mayor Leppert both endorsed the application without modification and made the unsupported claim that the application would somehow benefit North Texas.
http://www.dfwairport.com/pressroom/...-agreement.pdf
Last edited by UptownDallas; 10 March 2010 at 04:42 PM.
AA is starting DFW-Madrid service. When will we get DFW-Helsinki and DFW-Amman?
I wonder if this new cooperation will lead to AA giving JetBlue one or both of their gates at DAL after the Wright Amendment departs...
American Airlines, JetBlue propose swap of slots in New York, Washington
12:03 PM CDT on Wednesday, March 31, 2010
By TERRY MAXON / The Dallas Morning News
tmaxon@dallasnews.com
http://www.dallasnews.com/sharedcont...1ffbffc44.html
American Airlines Inc. and JetBlue Airways Corp. are exchanging airport slots so that American can boost its service in New York and JetBlue can grow in Washington.
The deal, announced Wednesday morning, would also include a marketing partnership so that JetBlue will feed passengers to American’s international flights from New York and Boston, and American will feed passengers to JetBlue’s domestic flights.
"Our announcements today demonstrate our strong commitment to New York, and we look forward to expanding that commitment in the months and years to come," American chairman and chief executive officer Gerard Arpey said.
"We have a long history in New York, and we're going to grow those roots with new routes, new partnerships, even deeper local relationships, and the kind of service that New Yorkers expect and that will attract more visitors and commerce to the city," he said.
As part of the deal:
• American would pick up 12 pairs of landing and takeoff slots at New York’s Kennedy International Airport from JetBlue.
• JetBlue would obtain eight pairs of slots at Ronald Reagan Washington National Airport and one slot pair at White Plains, N.Y., from American.
• American would feed passengers to JetBlue’s U.S. flights on routes on which they do not compete.
• JetBlue would feed passengers to American at Boston Logan Airport and New York Kennedy to the 12 international destinations that American serves from those cities.
• The two will also consider other areas of cooperation.
...
http://online.wsj.com/article/SB1000...CONDTopStories
People familiar with the matter said Glenn Tilton, UAL's CEO, would become non-executive chairman of the combined airline for two years if the merger plan is finalized and receives antitrust clearance. Continental CEO Jeff Smisek, 55 years old, would become CEO of the combo immediately and add the chairman's post when Mr. Tilton, 62, stepped down. The two airlines already have agreed the combined company would be based in Chicago and United would be the surviving brand.
I am not the airline guy, so you frequent flier junkies, how do you think this merger (should it happen) would affect DFW and LUV? It appears UAL could have a lock on both ORD and IAH.
Tighten the female dog!
A few sources are saying Chicago would be the HQ (really just the Chicago Tribune that started that rumor), but most others have no mention of it. Here is a more recent article: http://www.bizjournals.com/dallas/st...26/daily1.html
Seems to me that United is trying to dictate everything. Aren't they the airline in more trouble and not Continental? I say, you keep the United name and have the HQ in Houston, or keep the Continental name, but have the HQ in Chicago. Hopefully it doesn't happen, because if Continental does merge with United and only the top executives move to Chicago, we all will have one gigantic crappy airline. United service is beyond horrible. Why anyone would fly them is beyond me.
Hasn't it been pretty much said that its going to be Continental execs running the company? Its beyond me why when faced with the choice of doing business in Chicago or Houston and you already have offices in both, why you would pick Chicago. United has been consolidating its Chicago operations back to the United Center downtown moving its support centers away from the airport anyways.
United 2.0 needs Houston to be the gateway to Central and South America where AA has a stranglehold via Miami. And Continental is weaker in Europe, Austraila and SE Asia. CLE is done as a hub and if I was Denver I would shaking in my boots, it would a be redundant hub with ORD, LAX, IAH, IAD... but the real question is would the New World Order let DEN cease to be a hub???
As far as the worst air carrier, United, ruining what people seem to think is a decent airline, Continental... If you can't be the best airline, just try to be the biggest airline. I think thats been the mantra of the airline industry for the last 25 years.
Last edited by aygriffith; 27 April 2010 at 02:17 AM.
United has not had a decent culture for a long time, then with cutback/givebacks and reductions it went downhill a lot more. There is little doubt the good culture of Continental will be seriously trashed by the current United. Will the combo make it through the next 5 years? I guess miracles can happen...
"Liberalism: Moochers Electing Looters to Steal from Producers."
Never to fear. Houston's own SJL is getting in the game: http://www.chron.com/disp/story.mpl/...s/6976389.html
But I am sure United is also calling its own contacts in DC, last I checked, Chicago has quite a few contacts in DC. Maybe if those Chicago contacts in DC give United a nod and wink on future destinations in Asia, and telling the DOJ not to be too hard, United could probably pull it off.
Tighten the female dog!
More on United-Continental
http://blogs.wsj.com/deals/2010/04/2...al-brand-name/
Tighten the female dog!
With Republic Airways now owning Frontier and strengthening Frontier's operations there along with Southwest making a strong push for growth at Denver, I would highly doubt that they would let it go by the wayside. Especially since it is the only international carrier there that can easily connect to both Europe and Asia bound flights.... but the real question is would the New World Order let DEN cease to be a hub???
Not just Sheila Jackson-Lee. She started it, but more are taking over:
More at the link.City leaders eager to hold on to Continental
By JENALIA MORENO and PURVA PATEL
Houston Chronicle
April 27, 2010, 10:01PM
http://www.chron.com/disp/story.mpl/...s/6978844.html
Houston leaders said they want a chance to offer incentives to encourage Continental Airlines to keep its headquarters here if it merges with Chicago-based United Airlines.
There are indications that if the two carriers merge, the new company would be based in Chicago. Two years ago, the airlines discussed merging, and Chicago was planned as the headquarters of the new company until Continental ended those talks.
While no incentive package has been assembled yet, state and city officials said they were willing to match anything Chicago has to offer and simply want a seat at the table.
“We may be a little bit late to the dance because we weren't aware these talks were going to suddenly go on to the front burner, but we're definitely reaching out and we feel the board and chairman of Continental know what a great place Houston is and how much we have to offer them,” Parker said during a news conference also attended by state Sen. Rodney Ellis, D-Houston.
On Tuesday, Mayor Annise Parker, County Judge Ed Emmett and the Greater Houston Partnership sent a letter to Jeff Smisek, Continental's chairman, president and CEO, and Glenn Tilton, United's chairman, president and CEO.
As soon as news of merger talks hit the media, Parker said, she left messages for Smisek to let him know the city was willing to work with a merged company in order to keep its headquarters in town.
She said a potential merger was a business decision and that the city doesn't need to sell leadership at Continental about Houston's assets, but does need to persuade the leaders of United.
Gov. Rick Perry made a similar call, said Aaron Demerson, director of the governor's economic development and tourism division. If the merged company leads to job creation in Texas, the state could consider an award from the Texas Enterprise Fund among incentives, he said.
What's with all these politicians freaking out about Continental maybe becoming United and moving corporate jobs to Chicago? Remember last year when EDS, ACS and Perot Systems got bought by HP, Xerox and Dell?
I don't remember the Governor or Representatives or Senators or Mayors or anyone staging publicity events to keep these homegrown companies, principal leaders of the much larger, growing Information Technology industry headquartered in Dallas/Plano. AND, I don't remember any of the politicians wringing their hands about losing jobs because of the acquisitions.
What's so special about Continental and the airline industry that it gets such attention, while the IT Industry and loss of IT management company headquarters in North Texas was treated with indifference?
I don't get it.
Last edited by tamtagon; 28 April 2010 at 11:33 AM.
You will notice a lot more Democratic politicians than Republicans are out in front of this issue. Airlines are highly unionized, and as we will know, labor tends to vote Democratic. Also, airlines are much more regulated than the IT industry, so there is a natural synergy between politics and regulated industries/sectors.
Tighten the female dog!
http://online.wsj.com/article/SB1000..._LEFTWhatsNews
Continental already has agreed in theory to allow the combined airline to be based in Chicago, United's home base, and to retain the United brand. Jeff Smisek, Continental's chief executive officer, would become CEO of the merged carrier; Glenn Tilton, UAL's CEO, would become non-executive chairman for two years, after which Mr. Smisek would take over that role too, said people familiar with the matter.
Other people familiar with the matter said the mood of the talks was more relaxed and positive than earlier this week, when the two sides were at an impasse over the share price. They said negotiations seemed to be back on track with a narrowing of differences over the share price, leading these people to believe a deal could be announced early next week.
Tighten the female dog!
It's only the Houston city leaders that care. It's the dubious prestige about which city has the HQ. The union jobs are not going anywhere.
It makes sense to move your horses to Chicago. United is an airline that requires serious repair, top to bottom, and it's not going to happen remotely from Houston. I'd expect that it won't be too pleasant for the Chicago staff. The HQ may stay, but many of them won't. The CEO could deputize a change agent to do the housecleaning. He likely feels it's too important to the combined firm's success to not direct it himself or be very close to it.
I think it's the exact opposite. Moving to Chicago will only make it worse. If you want real change, have the HQ in Houston.
They've been ceding market to Southwest and Frontier for quite awhile in DEN. The only reason for them to keep the hub is not to give up all the Mountain West traffic to Delta in SLC (which they've been giving up for the past 5 years anyways). It would be a huge blow to DEN as they would basically close off Concourse B. That would make DEN the biggest white elephant former hub since STL and PIT.
I predict "focus city" in the future for DEN... They have minimal key international routes that aren't already served in higher frequency from LAX, ORD, and IAH. UA/CO can't operate two mid continent hubs (ORD, IAH), a Mountain West hub (DEN), 2 West Coast Hubs (LAX, SFO), Rust Belt hub (CLE), two East Coast Hubs (IAD, EWR). Thinking they'll keep all of these is like thinking DL will have all of their combined hubs within 5 years.
But with both airlines operating quite a bit of Airbus product it seems like it would be a great fit to merge. UA did just get rid of their last B737 last year but will be adding them back by gaining CO's NG 737's. UA's first class product is dismal compared to CO's and generally their planes' interiors just aren't as nice as CO's. UA gains access to intra-texas which it lacked, CO gains mountain west and intra west coast routes which it lacked... but as imagined most of the other domestic routes are redundant.
But the thing people haven't asked is... Who's going to buy US Airways now?
United's international traffic at Denver has steadily declined. Denver sees less European traffic than DFW and the cargo operations are minimal compared to what we have here in Dallas. I know that there is only one British Airways and one Lufthansa flight, but after that I think it is all conducted by United, and I believe that there are no operators from Asia that have service to Denver. It would not surprise me to see them consider it as a "focus city", but it would be quite a large operation for that.
Denver is a wonderful airport though, especially for us aviation geek types, cause there is always a good view. I have always enjoyed traveling through Denver always a good time.
http://online.wsj.com/article/SB1000...=djemalertNEWS
Continental Airlines Inc. and UAL Corp.'s United Airlines are expected to announce Monday that they are merging to form the world's largest airline by traffic, people familiar with the matter said.
The United board is meeting Friday, while Continental's board is meeting Friday and Sunday to discuss the deal, these people said.
These people cautioned that negotiations could fall apart at the last minute as they did in 2008, when Continental backed away. But after a hiccup over pricing the transaction, the talks appear to be on track, they said.
Tighten the female dog!
So are AA and US Airways next? Forget about the fleets not matching and the guy that runs US Airways. The hub and routes seem to really compliment each other.
Last edited by ihavebeenseen; 30 April 2010 at 07:51 AM.
And you would have the two worst customer service airlines merging... yay...
20 years from now the global airline industry will be like the Las Vegas strip - 20 different casinos owned by 4 or 5 companies.And you would have the two worst customer service airlines merging... yay...
Tighten the female dog!
http://www.reuters.com/article/idUSTRE63T3TI20100430
(Reuters) - United Airlines (UAUA.O) and Continental Airlines (CAL.N) can expect to win U.S. government approval of any merger proposal as their combined operations do not appear to raise serious competition issues.
Deals
The Obama administration would likely approve a deal to create the world's biggest airline but could first require the sale of certain routes or other assets to boost competition, antitrust attorneys and industry experts told Reuters.
"Given the nature of the airline industry, the antitrust regulators will not block this merger, in my judgment," said antitrust expert Evan Stewart of the law firm Zuckerman Spaeder
LLP.
But the carriers should not expect a Justice Department review to be as swift as the 2008 acquisition of Northwest Airlines by Delta Air Lines (DAL.N), which was deliberately timed to be considered by the business-friendly Bush administration.
"It will take a long time and there will be a lot of people complaining behind the scenes, especially the unions," said John Briggs, an antitrust attorney with Axinn, Veltrop and Harkrider LLP.
Sources familiar with the discussions have told Reuters that United and Continental are close to proposing a merger for the second time in two years, and a deal could be announced within days. Discussions in 2008 ended with Continental walking away, concerned about bigger United's financial health.
Neither United nor Continental have confirmed they are talking again.
Analysts have trumpeted such a deal as good for all U.S. carriers and the 700 million passengers they fly each year due to expectations the merged entity would remove excess capacity and prompt greater efficiency.
With passenger demand on the upswing in an improving economy, the timing of any deal is better than 2008 when airlines were in financial turmoil amid recession.
Although the Justice Department has deep experience analyzing airline merger proposals, the Obama administration's top antitrust enforcer, Christine Varney, has not concentrated on traditional industries.
"She is focused on technology and those sorts of issues because that's where America has competitive leadership. There's some important issues here but I don't think it's her priority," Stewart said.
UNITED TURBULENCE
United's experience with the U.S. government has been anything but smooth since 2000.
A proposed merger with US Airways (LCC.N) in 2001 foundered over competition concerns. United's bid for a federal loan guarantee in 2002 was rejected by a Treasury board, stunning the carrier and pushing it into bankruptcy.
United's latest application, a waiver from antitrust law as part of an overseas alliance with Continental, was approved earlier this year by the Transportation Department over strong objections by Justice antitrust officials.
It is unclear if any concerns from the contentious antitrust waiver case would spill over into a merger review.
Antitrust review of a merger's impact on consumers focuses on nonstop routes where parties compete directly, proximity of hubs and other big operations, and the potential for fare increases in concentrated regions.
Big airlines with merger aspirations argue that concerns about competition should be muted because of the fragmentation of the U.S. airline market where more than a dozen carriers and regional affiliates operate.
Airlines are no longer hemorrhaging financially but there are key players, like United Chief Executive Glenn Tilton, who believe consolidation is crucial for industry health. Airline mergers historically have an uneven success rate, but the Delta deal has generated cost savings, and the carrier has narrowed losses and expects to be profitable this quarter.
Continental flew more than 30 million passengers between February 2009 and January 2010, according to Transportation Department figures. Its two biggest hubs are Houston and Newark.
United flew 47 million passengers over the same period, more than half of them using hubs in Chicago, Denver, San Francisco, Washington Dulles and Los Angeles.
The carriers have no overlaps in their hubs or top 10 domestic nonstop flights, according to a review of their biggest operations.
"That is definitely a plus," said Beau Buffier, an attorney with Shearman & Sterling LLP.
Another antitrust attorney said the Justice Department could require the carriers to give up some routes or other assets to boost competition, perhaps in the greater New York area, where operating rights to key airports is heavily regulated. Access there is coveted as a destination and jumping off point for premium domestic and international business travel.
"Because Continental controls Newark and United is not tiny at (John F. Kennedy) and LaGuardia, they could require something at those airports," he said.
(Reporting by John Crawley and Diane Bartz; Editing by Phil Berlowitz)
Socialism - bringing a greater good to a greater many, one golden parachute at a time.
Taking "Service With a Snarl" to whole new heights.And you would have the two worst customer service airlines merging... yay...
"Liberalism: Moochers Electing Looters to Steal from Producers."
News Alert
from The Wall Street Journal
UAL's United Airlines is expected to announce early Monday that it will acquire Continental Airlines in a share swap valued at more than $3 billion, a deal that would create the world’s largest airline.
The boards of UAL and Continental were scheduled to meet Sunday and, barring a last-minute snag, were expected to sign off on a merger agreement that would pay Continental shareholders a price higher than the airline's current market capitalization of $3.1 billion.
http://online.wsj.com/?mod=djemalertNEWS
Tighten the female dog!
The only good part of an AA/USAir merger would be the old America West routes. Flying them out west was a pleasure. The new planes and friendly staff were a welcomed departure from the torture that you have to endure on the east coast with USAir.
With the possible exception of their international crews/planes AA has a lot of ground to make up vs the new mega airlines. I have never had a bad experience on Delta or Continental. Hopefully, Continental's level of service will spread through UA (though, I highly doubt it...)
I can't wait until teleportation is perfected.
Tighten the female dog!
Is that an official rendering of the new United paint/labeling scheme (including the old Continental Livery)? Or, is that someone's unofficial idea of what the new airplanes will look like?
Last edited by Mballar; 03 May 2010 at 05:18 PM.
A wise man speaks because he has something to say; a fool because he has to say something. - Plato
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