Report: Delta assessing bid for American Airlines

Discussion in 'Delta Air Lines | SkyMiles' started by KENNECTED, Jan 12, 2012.  |  Print Topic

  1. KENNECTED
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    KENNECTED Silver Member

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    I'll believe this when pigs fly & and 6'3" tall!

    Delta needs to concentrate on getting their current house in order.

    read more here: http://travel.usatoday.com/flights/...aycomTravel-TopStories+(Travel+-+Top+Stories)
     
  2. flyingdawg
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    flyingdawg Gold Member

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  3. DeacFlyer1
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    DeacFlyer1 Silver Member

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    "Delta has conducted an antitrust analysis on a possible tie-up with AMR and concluded that with some concessions, such a deal has a good chance of getting approval from regulators, according to The Journal."

    http://aviationblog.dallasnews.com/archives/2012/01/wsj-reports-delta-and-tpg-capi.html

    "Delta" was not the name I would've ever thought in a million years to put in the same sentence as "merger with AA" before reading this...
     
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  4. MSPeconomist
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    MSPeconomist Gold Member

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    FYI, there's another longer thread where this is being discussed In more detail on MP. It's currently in the AA forum. Of course, there are also threads on TOBB.
     
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  5. DTWBOB

    DTWBOB Silver Member

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    The fact that Delta is looking at it doesn't mean anything is going to happen, but it would be err-responsible to their stock holders for them not to do so -- (any pun intended).

    DTWBOB
     
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  6. rwoman
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    rwoman Gold Member

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    In the far off case this happened, I guess all this time in AA the past year would just add to my MM balance...;) guess the secondary airline would become UA. :p
     
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  7. MSPeconomist
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    MSPeconomist Gold Member

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    Yes, but I hope DL would recalculate AA MM miles according to DL rules.

    Of course, with AA merging with DL in SkyTeam, either US would move into oneworld or some of the unaligned airlines like AS and Virgin America would do so.
     
  8. jbcarioca
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    jbcarioca Gold Member

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    And SkyTeam, largely useless as they are, would suddenly be quite a powerhouse with even South America suddenly gaining coverage next year anyway. Those joiners may be quite dismayed to see AA suddenly under their tent. OH, it is interesting!
     
  9. zshanlon

    zshanlon Silver Member

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    Me either. Its an interesting thought though. It would basically wipe our all the competition in MIA and NYC. It would give them a great market to the West and more competition in ORD which might allow them to finally shut down CVG, MEM, or MSP....

    Im from W-S. Go Deacs!
     
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  10. TRAVELSIG
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    TRAVELSIG Gold Member

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    Anti-trust would approve this? Wow. It would wipe out all competition in both MIA and NYC- to huge aviation markets. Latin America would be another area where the dominance would not be the best thing for the consumer. Let's hope this doesn't come to anything further than a "look".
     
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  11. jbcarioca
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    jbcarioca Gold Member

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    DL actually is not a major LA player, and the impact for MIA and ATL would be negligible. Remember this is about non-stop city pairs, not hub dominance, as MSPEconomist reminded us upthread. The MIA competition is largely from non-US carriers, such as anybody has success there, and in freight LAN is a huge player (LAN freight is based in MIA). As for NYC, it is nowhere a fortress hub other than *A at EWR, unaffected by this merger. LGA and JFK will obviously see more concentration, but most of that does not cross non-stop city pairs. ORD and DFW, even, will not see huge challenges.

    So long as the review is city-pair based this deal would not be a hard thing to imagine.
    The fun thing for me is to imagine how they'd choose an alliance. I'd wager they'd prefer OW to ST because of the Asia and Europe coverage they'd have. Clearly they'd need to do some fast moves in China!
     
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  12. TRAVELSIG
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    TRAVELSIG Gold Member

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    Interesting discussion jbcarioca.

    What the recent formation of the IAG- wasn't there some thinking a while back about bringing AA into this group?
     
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  13. jbcarioca
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    jbcarioca Gold Member

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    Yes I recall such debates. However the US foreign ownership rules would really make that a nearly impossible task. They also debated JAL, IIRC.
     
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  14. TRAVELSIG
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    TRAVELSIG Gold Member

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    Isn't there (finally/yet) discussion on changing the USA foreign ownership rules? I thought Virgin America was also pushing for something to get change here.
     
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  15. autolycus

    autolycus Gold Member

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    I'm hardly an insider, but I do know some DL employees and I read a lot of business news about them, being an ATL resident. With DL doing the buying, I don't think there's any way they'd go to OW. I just don't think their corporate culture would allow it. They're a founding member of SkyTeam and have far too entrenched a relationship with their European partners for them to move to another alliance willingly. I think the odds would be better that DL and SkyTeam would make a major play at one or more of the Asian carriers to jump ship from OW to ST.
     
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  16. jbcarioca
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    jbcarioca Gold Member

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    Virgin American had to remove the US-born US-citizen Fred reid as CEO in order to get operating approval based on the facts that: 1) he knew Richard Branson, 2) He was a former President of Lufthansa. It probably did not help that he is fluent in French and German, either. Virgin America cannot share loyalty programs with Virgin Atlantic either. They certainly would like to see rules changed, no doubt about that.
     
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  17. jbcarioca
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    jbcarioca Gold Member

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    Of course the DL team that formed ST are no longer anywhere involved and the connections with AF and SU were based on lots of affinity between DL top managers of the time and the teams of AF and SU. While I do not think this deal will happen, I do think there would be a real horserace to choose the eventual alliance were that to happen. After all, who would you rather have;
    1) DL, AF/KL, SU, KE or
    2) BA/IB, CX, JL, QF
     
  18. mtkeller
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    mtkeller Silver Member

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    Don't forget the China situation. SkyTeam is much stronger in China, and I think DL would be wanting to pull some defectors with from ST were they to move to OW. If DL could snag a mainland Chinese carrier and 9W could get their financial house in order (and maybe LATAM were lured to go OW over *A), I think DL would dump AF/KL in a heartbeat. I think there's too many conditionals on that, so in the unlikely event the acquisition goes through to some degree or another, I would guess DL stays in ST.
     
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  19. autolycus

    autolycus Gold Member

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    Oh, I'd much rather DL be partnered with CX, JL and QF for sure. I have no real preference on BA vs. AF/KL simply because I personally see some big advantages to some of the exotic francophones that AF flies to (e.g. PPT and MRU), and I don't really want to possibly have to pay the exhorbitant taxes associated with Heathrow--I plead total ignorance on whether those have to be paid when transferring through LHR from US to EU or just when LHR is the O/D airport. I think the death of AA would put a lot of pressure toward consolidation to just two global alliances, or would at least cause a few major airlines to jump from one alliance to another.

    I, like most on this board, doubt this merger would ever happen. I think the labor issues alone could be a kill any benefits, but perhaps DL could pull off something like they did with NWA and smooth things over fairly well before a buyout is even in place. They certainly managed the labor issues better than US Airways has been able to.

    I'm sure AA's preference for any buyout scenario would be for someone like TPG to step in, prop them up, give them a kick in the butt, and get them moving forward again as AA.
     
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  20. redtailshark

    redtailshark Silver Member

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    There's only one certainty about this merger, if it ever happens.

    The otherwise valuable AA Aadvantage program overnight would become *best in clAAAAAAAAAAAAAAAAAAAAAAssss*
     
  21. LETTERBOY
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    LETTERBOY Gold Member

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    There may be some discussion, but it'll never happen. Certainly not in the current economic environment. "US companies being sold to foriegners!!!! Eeeeek!!" Now, we all know it really wouldn't have much impact, but that's what the politicians will say, and there are people who will buy that. And when you factor in the presidential election, and all the pronouncements and grandstanding that entails, there's just no way.

    Evern if the economic and political situation were better, politicians and America-first types would scream loudly enough to most likely stop it, for better or worse.
     
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  22. jbcarioca
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    jbcarioca Gold Member

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    Strange that the US ostensible right is against this and the ostensible left is for it. I wish I understood the US, after all I am a born American, but I feel clueless.
     
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  23. USAF_Pride
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    USAF_Pride Gold Member

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    But whose website would they end up using? That is the real question that needs to be answered!!! ;)
     
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