Possible US Air and AA merger, what if means for frequent flyers

[markis10]

We live interesting times.

Consumers likely won't lose the miles they've already accumulated if a merger does come to pass. However, when other airlines have merged, consumers have lost some popular perks such as free upgrades and the chance to accumulate points while flying other carriers.
"All things being equal, I would expect a merged American-US Airways frequent flier program to be somewhat less generous than the two airlines' programs today," said Seth Kaplan, managing partner of Airline Weekly in Fort Lauderdale, Florida. "Maybe you'll need more miles for free tickets to certain regions, or maybe award seats will be more scarce, or maybe it'll be harder for elite fliers to get first-class upgrades."

http://www.reuters.com/article/2012...airline-merge-loyaltycl-idUSL2E8FP5C620120425

 

[drron]

Already being discussed on several threads including this recent one-
http://www.australianfrequentflyer....us-positions-potential-aa-takeover-38766.html

All is speculation.Some reports are already discounting US Airways chances-
AA Creditors Side With Airline, Favor Ending Union Contracts | NBC 5 Dallas-Fort Worth

NBC 5's Scott Gordon reported from New York that the creditors committee is siding with the company and favors ripping up union contracts. The three unions each have a seat on the committee but were unable to convince the other six members to support their position.

 

[markis10]

Already being discussed on several threads including this recent one-
http://www.australianfrequentflyer....us-positions-potential-aa-takeover-38766.html

All is speculation.Some reports are already discounting US Airways chances-
AA Creditors Side With Airline, Favor Ending Union Contracts | NBC 5 Dallas-Fort Worth

Given their failed merger with Delta I agree it could be hard, interestingly things did seem to heat up today, so I suspect a go or no go decision is close.

 

[NM]

The merger option is being pushed by the unions. I wonder how much influence they will have over the accountants that will ultimately make the decisions about AA life post Chapter 11?

 

[drron]

Not all the unions are convinced that the merger will take place.here is the TWU view-

Please take note that the judge DOES NOT write a new contract. He does not rule on any individual contract items at all. He simply grants or denies the AA motion to completely reject and cancel our contracts.
As you know bankruptcy law is very labor unfriendly, and in the vast majority of cases large corporations win their 1113 cases. This is the harsh reality of the prior court rulings.
Finally, we will soon be posting information on the USAir terms. NOTE THAT THE AA 1113 RATIFICATION VOTE HAS NOTHING TO WITH THE POSSIBLE USAIR MERGER. The issues are legally unrelated. Even a yes vote on the AA final offer will not prevent a possible merger, which still faces many hurdles unrelated to labor issues.

Comes from the Dallas News.-
Airline Biz Blog | dallasnews.com

The US airways unions are not overjoyed either-

The International Association of Machinists and Aerospace Workers put out word Tuesday that its members at US Airways aren't happy about US Airways' announcement that it has deals with American Airlines' three unions for a possible merger.

And Court reports are that the Unions were unable to get other members of the Creditor's committee on side-
On

Monday, the unsecured creditors committee told U.S. Bankruptcy Judge Sean Lane that it backs American Airlines' motion to reject the carrier's labor contracts.
In addition, the committee's attorney said the committee supports American's standalone plan that calls for emerging from bankruptcy as it is today, without merging with any other carrier.

In the long run I would think it is likely AA and US will merge.US wants it to be soon as then their executive team will be in charge.If it occurs after AA emerges from bankruptcy then it will be the AA team in charge.Which CEO has the biggest ego?

 

[serfty]

The merger option is being pushed by the unions. I wonder how much influence they will have over the accountants that will ultimately make the decisions about AA life post Chapter 11?

In pretty basic terms the unions have three 'votes' out of nine. (It more complicated than that, but it's the same effect.)

AA employees currently have the most beneficial employment terms of any of the USA legacy carriers and with AA proposing to cut them and US indicating it would retain them it is not a surprise they are supportive of the US proposal.

It will be interesting to see what the AA is like after this - for example, First/Business class catering.

Generally, US flights under 3½ hours scheduling do not provide a First Class meal service at all - merely a few snacks. For AA it's under two hours for First/Business class.

I am in the middle of flying to the Caribbean from LAX on US and back on AA - all in First/Business.

On US, only the PHL-SJU segment will provide a meal, on AA a LAS-LAX segment will provide snack mix, full meals will be available on all other flights.

Having experienced both regularly, I have found that generally food quality is on a par, service on AA is more formal and AA meals are larger. Also, AA's service comes with warm nute and baked cookies.

Here's US's catering philosophy: (US Airways | About First Class)

What to expect

< 1.5 hours Snack on a Biscoff sweet biscuit or savory coughtail mix.
1.5 - 3.5 hours Enjoy our new upgraded snack basket with tastier, specialty snacks.
3.5 + hours Taste heartier meals and more vegetarian-friendly dishes.

Here's what AA has to say: (North American / Caribbean Meal Service and Food For Sale Program)

Complimentary food service is offered in First Class on all flights systemwide that have flying times over two hours and that operate within traditional breakfast, lunch and dinner times. Generally, a snack service will be provided on flights greater than two and a half hours that fall outside of a traditional meal time. A light snack may include our signature warm mixed nuts and baked on board cookies.

 

[burmans]

One advantage of a merger would be that US would finally have it's own forum.

Is it only me or does anyone else feel that the fact we have one post with over 80000 views might indicate we actually need a US Air forum!

 

[cove]

NBC are reporting this afternoon that US Air and American Airlines are in merger discussions.

 

[serfty]

They had a scheduled meeting for Tuesday last week in NYC - "Sandy" had that postponed for a week.

See here for dome FT comment: US Airways & AMR / AA Takeover Rumors and Discussion (consolidated) - Page 133 - FlyerTalk Forums

American-US Airways merger proposal expected to come soon | Dallas-Fort Worth Airlines News - Business News for Dallas, Texas - The Dallas Morning News

 

[Paddy55]

So long as the new entity stays in OneWorld....

 

[serfty]

So long as the new entity stays in OneWorld....

That's already been stated by Parker, the head honcho at US.

However, while I do believe a merger will happen, it is likely to be next year after AA emerges from Ch11.

 

[anat0l]

However, while I do believe a merger will happen, it is likely to be next year after AA emerges from Ch11.

You're pretty confident about that?

Of course, having seen most Americans (and, if we take the magnified level of affairs, FTers) endure the latest merger between UA and CO, most are naturally cautious and pessimistic about a merger, most likely in the guise of loss or dilution of benefits. I wouldn't be surprised if we saw another one or two lawsuits related to these things (FT has a thread of a man, perhaps an FTers, who has filed a case against United asking for damages and/or honoring of his million miler benefits, which were modified after the merger).

The effect might be magnified even more as a handful of UA or CO elites moved over to AA, turning their backs on the programme which supposedly abandoned their interests.

It will be interesting to see how they combine AAdvantage and US Dividend Miles (I'm guessing most likely a 1:1 conversion from one to the other). Dare I mention it, does this potentially open up an interesting tack of stocking up on US points on the cheap in anticipation of possibly being able to burn them with oneworld later... (Yes, I'm aware that such things are invariably fraught with risk, often unacceptable levels of risk...)

 

[serfty]

You're pretty confident about that? ...

Going by the most credible posts on FT, US will not survive in the present environment much longer.

After AA first entered "Ch. 11" (I won't refer to it as bankruptcy) US made a "hostile" takeover/merger offer, even reaching an agreement with the AA unions should that succeed.

Since than AA has reached agreement with most of it's unions and other creditors, the only major holdout is with the pilots union and an agreement with them is expected to ratified soon.

AA does need to consider merger options as part of the Ch 11 process; so such discussion with possible suitors is required. Whether they actually accept a proposal is another matter.

 

[burmans]

They had a scheduled meeting for Tuesday last week in NYC - "Sandy" had that postponed for a week.

See here for dome FT comment: US Airways & AMR / AA Takeover Rumors and Discussion (consolidated) - Page 133 - FlyerTalk Forums

American-US Airways merger proposal expected to come soon | Dallas-Fort Worth Airlines News - Business News for Dallas, Texas - The Dallas Morning News

Beyond the hype it seems to me that all this says is that they are having yet another meeting to talk about it! While I appreciate some parts of US are keen on this, seems to me it takes two to tango and there aren't many indications of enthusiasm coming out of AA.

 

[fjc]

Heard on BBC that the merger may be going ahead. Did some searching and found following links:
American Airlines, U.S. Airways Considering Merger « CBS Chicago

The pilots’ union at American Airlines says pilot discord could jeopardize a possible merger (Updated 10:30 p.m.) | Airline Biz Blog

 

[markis10]

The fiscal cliff will change the landscape pretty quickly if it comes to pass! If it does, expect things to move quickly!

 

[Hvr]

The fiscal cliff will change the landscape pretty quickly if it comes to pass! If it does, expect things to move quickly!

But not necessarily for the better.

 

[markis10]

But not necessarily for the better.

Definitely not for the better I suspect.

 

[drron]

Heard on BBC that the merger may be going ahead. Did some searching and found following links:
American Airlines, U.S. Airways Considering Merger « CBS Chicago

The pilots’ union at American Airlines says pilot discord could jeopardize a possible merger (Updated 10:30 p.m.) | Airline Biz Blog

Basically some of the AA pilots really dont want a quick merger with US-
APA Pilots Opposing USAir Merger
Howard OShell