AMR hints it could be looking for Merger Partner

Discussion in 'American Airlines | AAdvantage' started by stuartfla, Oct 20, 2011.  |  Print Topic

  1. stuartfla
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    stuartfla Silver Member

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    From Houston Chronicle today.

    AMR-USAirways: The next airline merger?

    On a conference call today, Tom Horton, the president of American’s parent company, hinted that American could be looking for a dance partner, according to SkyTalk’s Andrea Ahles.

    In response to a question by TheStreet.com’s Ted Reed, Horton said that he believes there could be “further consolidation” in the U.S. airline industry.
    “Does that include you?” Reed asked.

    “Yeah, it could,” Horton said.

    http://blog.chron.com/lorensteffy/2011/10/amr-usairways-the-next-airline-merger/

    I for one am hoping against the potential of a US-AMR merger - there is no product/culture value in US Airways that I see from a longtime American Frequent Flyer perspective.
     
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  2. milchap
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    milchap Gold Member

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    A cross alliance merger?
     
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  3. DestinationDavid
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    I don't see US as a good match, brings almost nothing to the table. At least AS would cover some of the west coast gaps.

    B6 seems like a better candidate if I'm picking dance partners, and seems like AA has cozied up with them much more than anyone other US based airline.
     
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  4. iolaire
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    iolaire Gold Member

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    I've never read the merger threads, but wouldn’t it make more sense for a well-run (profitable) airline like Alaska to take them over?
     
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  5. yaychemistry

    yaychemistry Silver Member

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    AS has repeatedly said they don't want to merge, or take over another airline. They repeatedly stress in their earnings calls that part of their profitability comes from the fact that they are a smaller and thus can easily adapt their network to changes in demand. (e.g. when the economy sucks and business travel dries up, send half of their planes to hawaii). They also benefit from an all 737/Q400 fleet, which reduces maintenance and training costs.

    So I highly doubt AS to be involved in a merger. Of course, that's just my opinion and I could very well be wrong!
     
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  6. stuartfla
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    stuartfla Silver Member

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    B6 would be more welcome from my perspective then US, however it would seem like another try at a version of TED if that combo would keep the B6 equipment as is. The cost and time to change the planes might be too high of a hill to climb?
     
  7. DestinationDavid
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    VS. the labor and route structure money pit US would bring? ;)
     
  8. yaychemistry

    yaychemistry Silver Member

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    I could see B6 as a partner. However, there aren't that many candidates left in the domestic market anyway (SY?). The hint could also just mean more route-sharing between the strong AA/IB/BA transatlantic joint venture agreement. I might even hazard a guess creating a transpac joint venture with another OW partner (JAL?) or perhaps even a joint venture with LAN?

    Just taking random guesses.
     
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  9. DestinationDavid
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    I think consolidation is a bit different than JBV, so the openness that was affirmed would be an actual merger, IMHO.

    Plus, AA already has JBV with JL, BA and IB, and is in the process of having JBV with QF approved.
     
  10. stuartfla
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    stuartfla Silver Member

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    That would be some of what I hope Dallas folks are saying--if the decision makers were looking with that perspective, I am just not so sure that is the view finder the current AMR team has - all this from my very lay and "not in the know" thinking. US on many levels would be a bad choice, but the Houston Chron is not the only one throwing that out - and I am hoping they are all incorrect as Horton certainly did not hint at any potential dance card dates on the earning call!
     
  11. iolaire
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    iolaire Gold Member

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    Thanks, as I was writing it I also was thinking why would AK want to deal with AA's issues. If they really wanted to go bigger they probably could figure out a way to ramp up their current slow expansion. I appreciated them more than ever in early 2000 when they stated that the owned their planes and would expand during the down market rather than pay to have them sit unused...
     
  12. mowogo
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    mowogo Gold Member

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    US is a labor pit, not a money pit. They actually have decent management, just labor relations that make American's look wonderful. The only way US will be able to merge with anybody is Chapter 7, since nobody wants to even assume the labor issues.
     
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  13. DestinationDavid
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    I feel like US is often batted around because it's pretty much the only obvious "dancer" left, not to mention it's been fairly vocal about its desire to merge in the past, though maybe not so much now.
     
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  14. DestinationDavid
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    Considering how the two are related as you've laid out, I'm not sure there's more than a semantic difference.
     
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  15. JohnDeere19
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  16. DestinationDavid
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  17. jbcarioca
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    Wild speculation does not equal fire, just smoke. US is in no position to take over anyone, much less AMR. It is not reasonable to ascribe reality to such rumors based on a few easily misinterpreted words. We have heard about these things now for months, not weeks. Everyone is preoccupied with how AA has failed. They are not yet dead. I, for one, want to give them a chance on their own.
     
  18. RestlessLocationSyndrome
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    Everyone knows labor costs are a huge issue for AA. No logical business leader will want in on that situation... especially since they all filed Chapter 11 to avoid it themselves.
     
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  19. Gaucho
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    I suggest American merge with Aerolineas..... that will surely make AR a better company....

    (ducking for cover)
     
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  20. kw335
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    If there was anything to be had from US Airways, it would be Doug Parker replacing Gerard Arpey as a CEO of AA.
     
  21. Jaimito Cartero
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    Wow, Air Asia buying AA? I'd take the AK flight attendants over AA any day :)
     
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  22. HaveMilesWillTravel
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  23. kansaskeith

    kansaskeith Gold Member

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    Don't forget that just this summer, The New York Times reported that Mr. Horton had said sometime in his lifetime, he hoped that AA, IB and BA could fully merge. Yes, there is the restriction on foreign ownership of United States airlines right now, but Mr. Horton said this anyway. Less than three months ago. http://dealbook.nytimes.com/2011/08/01/american-airlines-hopes-for-a-b-a-merger/
     
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  24. alohastephen

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    or Hawaiian?
     
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  25. canucklehead
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    canucklehead Gold Member

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    Would a merger with Alaska be sufficient to help AA? While I hear USAirways being mentioned, I wonder if they are perceived to have dealt with corporate culture differences from the previous merger. IAG would make sense if US ownership laws were lifted. I remember articles like this one about EU pushing for looser restrictions but nothing has come from those talks.
     
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