US Airways has signed American Airlines Non-Disclosure Agreement and plans to engage in reviewing sensitive American Airlines information with AA in order to make a better determination if a merger can be done and, if so, how it should be done.
Expect both airlines to go pretty radio silent on this issue for many weeks now. It takes time to review data and it takes time to do an analysis on that data. US Airways has until December, more or less, to formulate a plan and have it ready for presentation.
If we hear of anything from AA about this process, especially from Tom Horton, expect this to become a much more ugly fight.
AA goes into this with the public thinking that it is already improving its situation with respect to reported profits for the past 2 months. Those reported profits aren’t “real”. Bankruptcy has allowed AA to stop paying many creditors and to reduce payments to others. Its operating costs are artificially low presently and combine that with the summer season and you get what appears to be “profit”. It’s a nice publicity announcement and can certainly go a long way towards confusing public perception but analysts know better.
Also of interest is the fact that AA has revealed it has signed NDAs with other parties as well. These may not be airlines and, in fact, they may be investment companies interested in participating in a stand-alone exit where the equity they would hold is quite likely to see a considerable gain in the first year.
Laura Wright, CFO of Southwest Airlines, has announced her upcoming retirement. Wright will retire on Sept 20th but remain within the company until the end of the year to assist in the transition to her named successor, Tammy Romo (current VP of Planning).
Wright is one of many exceptional airline executives that sit at Southwest Airlines. Frankly, I’ve often wondered why some of those executives don’t get headhunted by other airlines as they tend to be the very cream of the cream of the crop. Wright’s talent as CFO as well as her ability to partner with SWA executives is an excellent example.
As always, I expect that some will speculate on change at Southwest Airlines with a newcomer. The thing is, Southwest not only has great executives, they are a great training ground for upcoming executives. These people get mentored into the company in ways not seen at any other airline. And somehow they are kept in the fold.
The truth is that SWA could lose half of its executives overnight including the CEO and I think they would barely miss a beat in operating the airline. Wright was mentored by CEO Kelly and has no doubt mentored a number of people at SWA as well. Her calm guidance will be missed when it comes to publicly talking about the airline.
Watch this brief video of a very late, very tight A340 Air France go around as it approaches the island of St. Maarten as Tropical Storm Isaac approached.
Airline industry analyst, Richard Aboulafia, gets it. He’s written his monthly letter and addresses almost exclusively the mis-steps that Boeing has been engaged in. You can read it HERE.
Even if they seem like me too’s, I want to dig in here. The 787 and its launch was a signal event for Boeing in that they managed to not really do anything innovative for nearly 2 decades prior to that. The 777 did embody some innovation, yes, but it also had a lot of roots in evolution too. The 787 signaled that Boeing was to raise the stakes considerably.
The effect was to make the market start responding to Boeing rather than see Boeing react to its competitors. That was a very good thing. Even despite the 787 problems, Boeing managed to command the attention of both customers and its competitors. Admittedly, that has been diluted somewhat by Boeing’s “McDonnell Douglas” approach to the 747-8i.
In the narrow body race, Boeing barely got on the train. It got on but barely and even today there are things we just don’t know about the 737MAX that we already do know about the A320NEO. It’s taking a bit too long to reveal the 737MAX, in my opinion.
The market response to the 777-X concepts was an unqualified “We want it!”. You could not have had a more positive response to the ideas being floated and those responses were notable both for Aboulafia’s reasons as well as one other: They came from just the right mix of airlines. The kind of airlines that are near ideal as a mix of customers. You should never, ever ignore that.
More importantly, not only is the defection important psychologically and within the market. Here’s another problem: When these customers defect, you may not get a chance to address your mistakes with them for 20 or more years. That makes a defection very, very bad in terms of impact to a business like Boeing.
Finally, a capital intensive business such as Boeing doesn’t win by tossing rewards to its shareholders. It wins by being brave *and* right, over and over again. To be right in a business that requires engineering innovation to provide the gains that airlines want in performance, YOU MUST BE BRAVE ENOUGH TO TRY.
Boeing just signaled that its losing its courage. Not good. Not good at all. Aim for excellence, execute to get to that goal and you will win and thrive. Wait to see what the other guy is doing in order to provide something just 1% better leaves you exposed to being a has been.
Since behaving like responsible adults and taking their own best interests into account was too difficult, the Allied Pilots Association has now decided to stamp its feet and shakes its fists.
The APA has taken steps, very publicly, to get a strike vote against American Airlines. The APA board has taken a vote to authorize that steps be taken to make “. . . necessary preparations to conduct a strike vote of the membership and to initiate balloting upon the first action of AMR to impose any of the negative term sheet provisions.”
The problem is, the National Mediation Board has to give the APA permission to take this kind of action and even when it does, it imposes a 30 day cooling off period first. Not only has the NMB traditionally been very, very reluctant to release parties from negotiations, in the past decade it has shown no inclination to even hear a union out fully on its desire to strike.
Furthermore, once an airline exits bankruptcy, the NMB will be inclined to keep parties at the table for a long, long time.
So, lacking any influence on the bankruptcy for AA in the form of having a promised 13.5% equity stake in the airline or an influential seat at the unsecured creditors committee, the APA decided to fire its rational voice (David Bates) and act like a union from the old school days in making noise in the press about its desire to strike.
Well, there will be no legal strike over the next several years at American Airlines.
When the pilots stop throwing temper tantrums, I’m afraid their going to discover that they have sent themselves backwards 10 years or more both in compensation and quality of life. All because the membership making it personal.
QANTAS has shown a loss for its 2nd Quarter results and in the process announced a cancellation of its orders for the 787-9. Nominally, the basis for this is to reduce spending and QANTAS has already deferred some A380 deliveries for the same reason.
Reasons for QANTAS’ losses are in its international division and include very high fuel costs in that region. This begs the question as to why QANTAS would want to give up aircraft that would improve its position on fuel costs considerably. The international division relies upon a lot of 4-engine airliners presently and older Boeing 767 aircraft as well. While it has reduced its average fleet age, that has come about primarily through purchases of a few A330 aircraft and new Boeing 737-800 aircraft.
It’s notable that the 737-800 becomes less than desirable with the 737-8MAX on the horizon.
I would think that by now QANTAS would have come up with a rational fleet approach for its international long haul flying. While it has some critical mass on the A380, it still is operating an ever aging 747-400 fleet with some of those aircraft not due for retirement until 2018. The 767s can be improved upon massively with the 787 and that would help considerably.
The age of 4-engine airliners for even QANTAS’ trans-Pacific flying is ending in many respects. Virgin Australia is using the 777-300ER for similar routes to the US West Coast now and likely seeing far better CASM than what QANTAS experiences with the 747-400.
In a tiered approach, one would expect the 787-8 to replace about half of the 767 aircraft. The 787-9 could replace another 1/4 to 1/3 of that 767 fleet. The 777-200/300 could replace the remaining 767/747 flying easily and that leaves the A380 for high demand, trunk routes. With a 787/777 fleet, QANTAS would also experience better flexibility in its pilot group since a pilot can transition between either aircraft in just a handful of days.
It’s possible that if Boeing got off its delay in offering the 787-10, this aircraft could provide QANTAS with a nice fleet for medium to long haul travel at a fuel cost that would not be beat by any other airline.
A part of me sees QANTAS becoming a smaller and smaller player in the international domain. It lacks good partnerships with other airlines and the partnerships it does have sees those partners leaning heavily on QANTAS to do much of the expensive flying. It needs partnerships that are more equal in scope and which allow the airline to perform successfully on routes it can fly while offering customers options on routes it cannot fly.
It feels as if QANTAS and its leadership are simply managing the airline to mediocrity and you quickly become irrelevant in the marketplace that way.
Lest one believe that the APFA was going to meekly accept its contract and go forward quietly . . .
Surprise. They aren’t. APFA President Laura Glading has communicated that: “Now we need to work together to get rid of American Airlines management.” Glading says that the goal of the contract was to provide a mechanism to support a merger between US Airways and American Airlines with US Airways management taking over.
There is no doubt that APFA leadership does want that merger to happen. They’re angry and they want to show it to the current AA management, who, in fairness, has earned the enmity. But I’m not sure that rank and file saw it as quite the same purpose. The APFA membership are tired, beat up and fairly miserable. Yes, they’re angry too but the chatter I saw out there prior to the vote seem to indicate a certain inevitableness to the process.
The APA is now demanding information from AA to back up its filing for Section 1113 terms. This amuses me since their contention is that the contract was worth less savings than the Section 1113 terms are. So . . . why the hell didn’t you vote for the contract?
Because your membership is angry as hell and likely wouldn’t vote for any deal ever proposed by AA management.
I think that the APA is now officially irrelevant in most of the bankruptcy process. It denied itself a seat at the table by voting their contract down and trying to get that leverage back by challenging AA in court is a somewhat desperate move. The bankruptcy judge essentially agreed with American’s terms except in two relatively minor areas and where he did disagree, he provided a roadmap to AA to refile its motion and win.
This is going to be painful to watch the APA relegated to the sidelines and with a terrible contract to boot.
JetBlue CEO David Barger says that not only have they not received a non-disclosure agreement from American Airlines nor any contact regarding a merger, JetBlue does not want to merge with American Airlines.
Under any circumstances. Barger says that JetBlue sees its future as a successful independent and not bringing any value to the table in a merger with an airline such as American.
I agree. Purchase of JetBlue is an asset purchase, primarily, where American Airlines would suddenly be free to try to operate JetBlue routes with a cost structure exceptionally higher than JetBlue’s. Even after a successful, stand-alone bankruptcy exit, AA is unlikely to be able to operate at the same cost level of JetBlue or even close to it. So how does it win with JetBlue routes?
I like JetBlue still but I do think the airline has stagnated considerably since the departure of David Neeleman. In fact, I think that JetBlue has missed opportunities just preceeding and after American Airlines’ bankruptcy filing. Opportunities that I think Neeleman would have gambled on and won. That said, the airline is profitable, successful and operating in its niche acceptably. Barger isn’t wrong about not adding value to an airline such as AA.
Two senior QANTAS 747 pilots got into a heated argument over what data to input into a flight management system for takeoff. This occured on the QANTAS flight from DFW to Brisbane August 14. Ultimately, the flight was cancelled and set to take off the next day due to weather. However, it was determined that these two pilots could not work together and a replacement crew was sent. Both pilots are now suspended from duty.
Was this a safety of flight risk? Possibly. The environmental data one inputs into a modern flight management system determines things like take-off thrust and the speed at which an aircraft should lift off. On shorter runways, this can be criticial. On a flight like the DFW to Brisbane one, it is particularly critical since the aircraft will typically be fully loaded with a full fuel load. The flight is the longest that a 747 currently flies and is at the very edge of the range performance for a 747-400. On the other hand, DFW possesses runways that are extraordinarily long and even with a slightly incorrect performance calculation, a pilot would be able to adjust and continue the take-off or even reject the take-off if he/she sensed a problem.
But getting along in the cockpit is critical and this speaks to two pilots acting very unprofessional just prior to a flight where working as a team is what gets the aircraft to its destination. A destination that requires crossing 6000 miles of Pacific Ocean.
The Association of Professional Flight Attendants (APFA) of American Airlines has voted to accept the last and best final offer from American Airlines. This will please the bankruptcy court at the minimum.
American Airlines executives may choose to crow about this but I wouldn’t. The APFA doesn’t appear to have done this with enthusiasm or even belief in the idea that AA can thrive. They seemed to have done it out of exhaustion and the fact that the alternative gave them no hope for any improvement whatsoever for many, many years. It wasn’t the wrong choice but it wasn’t an enthusiastic endorsement of AA either.
In a couple of weeks, we’ll find out just how bad it will be for pilots at American Airlines when the bankruptcy judge rules to impose Section 1113 terms on the pilots. Make no mistake, this will hurt the pilots today, hurt them tomorrow and hurt them 5 years from now. Rather than position themselves to have a voice in their future and their airline, they are now positioned to sit and eat crow year after year. If any pilot believes the NMB will grant them the right to strike in the next 5 years, they’re kidding themselves like no one else out there. They may negotiate, that doesn’t mean they will be one step further along in pay or benefits than they will be two weeks from now.
Investors and creditors take note. This is a bad development for American Airlines. Even if they achieve their costs targets, this is the equivalent of winning the battle and losing the war. Costs may be low enough to survive but the costs are and will remain so, only half of the equation.
The other half is the somewhat more nebulous revenue side. The only way AA improves revenue is by marketing a better service to customers. It’s not enough to be the price winner in this environment. The other guys can match you fare for fare in the marketplace. It’s not enough to have the vaunted Cornerstone Strategy which, at best, concentrates business in hotly contested markets.
You have to have a product that someone wants to buy. American doesn’t have that today. An airlines employees are a massive factor in delivering service that brings customers back. Other airlines have proven this true over and over again.
American has a badly bruised and very angry workforce that will come in contact with every one of those passengers. That will have severe consequences for American Airlines over the next several years.
Let me ask you this: Where is American Airlines Cornerstone Strategy for improving employee morale and service product? That’s the cornerstone strategy that I would like to see talked about. Today, it doesn’t exist.
Mexican LCC carrier, Volaris, has announced it will begin service to Denver with twice weekly flights starting on the weekends and then moving these flights to daily as the peak season begins. The airline will serve the route between Mexico City and Denver.
The truly interesting thing in this is what isn’t being said . . . at least not yet.
Volaris is Southwest Airlines’ international partner in Mexico. The two airlines have a code share of sorts in place today (although it requires purchase of tickets from each airline to get the flight(s) you want.) Southwest is supposed to be working on technical solutions that will allow it to truly do a seamless codeshare with Volaris and other operators. So far, Southwest has been awfully quiet on this and when asked it generally responds that it has enough on its plate with the Airtran integration.
This would appear to be an opportunity for Southwest to enjoy more feed back and forth with Volaris given how big Southwest is in Denver. But no one has said a thing about it and it is entirely possible that nothing will be done to expand on it.
I’ve begun to suspect that Southwest has looked at its Volaris opportunities and balanced them against the capabilities that Southwest has bought with Airtran. Owning Airtran, Southwest is able to institute direct flights to Mexico and control the feed and revenue stream without having to cooperate with another company. It hasn’t figured out how to codeshare with Airtran operations any better . . . yet. But there is incentive to do so and it’s notable that in its purchase of Airtran, SWA likely does have a pathway to international operations in Mexico that is more clear.
Furthermore, SWA’s desire to operate Houston Hobby as a kind of “international focus city” to Mexico and Central America signal that it may be more interested in serving those destinations itself. I think this is exactly what is going on. Southwest sees opportunity and, more importantly, I think it sees a way to operate to those destinations without necessarily having to establish a large international infrastructure. It’s notable that SWA flights from Houston to Mexico and Central American destinations could be done without crew layovers in international cities. They would be international turns.
It’s time someone ask Southwest what it’s plans are for 2013 and what it’s plans are for international destinations. My bet is a 2015 start date for international operations using a new IT infrastructure.
Bankruptcy Judge Sean Lane did not impose Section 1113 terms per American Airlines’ request on pilots yesterday but don’t think that that was a win for the pilots. Judge Lane found two small areas where he disagreed with need. The first was unlimited codeshares and the second was an overly large number of furloughs.
American Airlines will revise its proposed terms and hand them back to the court in days and something will be decided. The pilots can crow victory for labor all they want, this wasn’t a win for them on any level. American Airlines is going to get fundamentally what they want and the judge signaled that, so far, he sees nothing out of line with the forming business plan despite the specious arguments made by pilots that it was unsustainable.
The business plan isn’t pie in the sky. I honestly don’t think they have made a strong business case for a long term view either. The continued focus on costs ignores the revenue problem which, despite AA PR, remains pretty bad. Costs are much easier to quantify and therefore generally remain in focus during bankruptcy. Revenue is based on a plan and projections that fundamentally rely on business conditions that are assumed and the ability to execute the plan.
My reservations about American Airlines are based on two fundamental observations. First, the executive team in place today is in no way fundamentally different than the one in place for the past decade. Over that past decade, the executive team has not shown itself capable of executing a plan to success. As a result, the company has lost more than $10 Billion over 10 years. That is not a company proving itself.
Second, business conditions in the industry are too volatile for making sound projections. Delta Airlines exited bankruptcy with a business plan based on $80 / barrel oil prices. Within months they were faced with $130 / barrel oil prices. The airline industry is subject to strong influences from a variety sources that are entirely outside of the airline industry’s control. The sum of American Airlines’ plan for revenues is “the other guys are doing this and we therefore think that with reduced costs, we can do that or better.”
The problem with that is you only know how the other guys are doing today, not how they’ll be doing tomorrow. The other guys have other issues to cope with that aren’t always the same issues that AA is presented with. Delta fixed many of its issues with a merger and built an unparalleled network as a result. Then they doubled down and did a deal to capture the NYC market. United did its merger in the reality that to compete with Delta, it needed scale and it remains to be seen that the ContiUnited merger is a true success. There is evidence that they’ll succeed, we can’t declare it a success quite yet.
My problem with American is that, so far, the business plan seems to ignore weaknesses that are inherent in the system today. In part, the Cornerstone Strategy relies upon capturing market share in very competitive markets. Anyone who follows this industry knows that in light of the capacity restraints that airlines have shown, American Airlines has been the least effective in this and hasn’t shown much restraint. Furthermore, to gain that market share means getting it on price (which sets off an industry war on fares) or on service. American Airlines continues to do virtually nothing to improve service and demonstrate that it has a handle on service issues and can get its employees to assist in raising the customer experience level.
I think American Airlines needs a team that can execute a revenue and service plan. That team sits at US Airways, not American Airlines.
American Airlines CEO Tom Horton told the Financial Times that an American Airlines merger partner could be decided within weeks. In the Financial Times story, Horton also reiterates his claims of being a consolidation advocate before it was cool to be one as well as that he suggested a US Airways / AA merger before Doug Parker did.
Want to know what I notice? US Airways and Doug Parker have gone radio silent. They have been largely radio silent for a few weeks now. Despite Horton’s Weird PR Trip, Parker & Company are nowhere to be seen.
And that does not mean that US Airways is having second thoughts. It’s not the snake you hear that bites you. It’s the snake that you don’t hear and don’t see that gets you.
I also note that Tom Horton is sounding very shrill these days.
A C-17 managed to land at the wrong airport a few days ago and I suspect that a pilot’s career may be over as a result. The C-17 landed at a private airport which has a 3500 foot long runway. It was intending to land at MacDill Air Force Base which has an 11,500 foot runway that was just 5 miles further along and which uses the same runway headings. The plane had to be significantly lightened and fuel burned off for a max power take-off to leave the small airport. Here is the video:
Terry Maxon at the Dallas Morning News has THIS blog entry on why we might have not heard much from the APA on a US Airways merger lately. The short version is that the APA board issued orders that APA President David Bates not speak about this after his appearance with Doug Parker in Washington earlier last month. Color me unsurprised.
The Allied Pilots Association Board is very dysfunctional. It’s comprised of Captains elected from pilot bases who each are sure they know one hell of a lot more about an airline than any other person. As a result, they run their union a little bit like the Mafia runs New York. They’re unified but only to a point and damn anyone who gets in the way of their opinions.
This means that unions officers such as the president, vice-president, etc really don’t get much power to execute in their offices. I think we now know why David Bates was asked to resign: He had already upset the board who wants its opinions to be public, not his.
No good deed goes unpunished and David Bates was punished.
This also speaks a lot on why the APA voted down its last offer: there was one set of voices advocating for the contract and entire board arguing against it in the background. No pilot wants to piss off his local union representative either.
What does it all mean? Simply this: Expect much more dysfunctional behavior on the part of the APA in the coming months. Do not be surprised if they appear to back away from US Airways as the APA board is going to want to be in charge of such a merger when it comes to the various pilots unions and it will want to use its power in endorsing a merger to get satisfactory terms. To do that, it first has to go silent on Doug Parker.
The problem is . . . by voting down that contract, Parker can’t use them nearly as much as he could have. He now has to work with other unions and bondholders and other members of the unsecured creditors committee. By allowing ego to get in the way of strategy, the APA has nearly completely removed its voice from the process.
But, hey, they sure smacked David Bates and Tom Horton around, didn’t they? (insert sarcastic tone)
There is a “heavy” circling JFK airport at this moment dumping fuel and preparing for an emergency landing. That’s all I can get right now but more as I learn it.
Well, it wasn’t a heavy. It was a Pinnacle Airlines Delta Connection airplane. Flight 3285. A regional jet with 2 blown tires and they proceeded to JFK from Boston after concluding the winds at Boston were too high for a safe landing.
As was inevitable, there are now public interest groups decrying a merger between US Airways and American Airlines as anti-competitive and bad for the consumer. No surprise.
Industry consolidation has been good for airline profits and we definitely have seen airlines move towards a more sustainable business model as a result. I would, however, credit capacity restraint for as much improvement in airline profits as anything else. Frankly, all of the major airlines in the United States (with the exception of AA) have impressed me with their discipline in the marketplace. It isn’t a discipline ever seen before and after 4 years, I think we’ve seen a transition to a truly different way of operating airlines.
That new model for operating as an airline includes looking at routes in the right manner, for once. They are now being treated as “businesses” and evaluated individually for profitability. In the old model, it was about market share at any cost. The problem with market share at any cost is that it required unfettered, almost violent, competition between airlines on routes and found routes being operated at a substantial loss for years. That has largely stopped now and I applaud the airlines for showing enough discipline over the last 4 years to make that stick.
Airlines also now seem to recognize that defending market share at any cost is a bad model as well. Curiously, the one airline that seems to have continued to trouble itself with defending routes is American Airlines. Until bankruptcy, the airline has “punished” intruders on its “turf” over and over again with high frequency, high capacity and extremely low fares to push out that intruder.
Finally, I think airlines have actually realized that providing a reasonable service experience is important again. It’s not the service model of the 1970s or 1980s, no. However, it also isn’t the embodiment of the idea that all a customer ever wants is a rock bottom price. If price was truly the only key to winning on a route, Spirit Airlines and Allegiant would be exploding with growth never seen before. They aren’t. In fact, what we have seen is that broader offerings of service levels attract more revenue per seat and that’s what airlines need.
US Airways has, in many ways, been a leader in executing change to meet the new industry model. It has figured out how to drive incremental revenue in ways that exceed most any other airline. At the same time, they have steadily improved customer experiences across their lines both on and off the airplane. They are now an airline that can be depended upon to deliver passengers to their destinations reliably and with their luggage. Am I the only one to notice that US Airways is about the only legacy airline to not experience a major public embarrassment over customer treatment in recent times?
American Airlines is actually the antithesis of US Airways and has shown a strong reluctance to acknowledge the industry changes. They’ve pursued market share, they’ve defended routes at all costs, they’ve been more price driven than any other legacy airline and many LCC airlines. They have not upgraded or improved their cabin experiences in any significant way since the 1980s. Their website drives customers away or at least angers customers. Their aircraft are old, inefficient, and painful to fly.
The SuperLegacies, United and Delta, have done quite a bit to improve everything across the board and one thing that AA hasn’t done: evaluated routes for profitability on a regular basis. Furthermore, UA and Delta now see opportunity on routes that have traditionally been owned by American Airlines. They’ve even overwhelmed cities where American Airlines was once a major presence and a dominant player (NYC, Wash D.C., Chicago, Los Angeles).
SuperLegacies are now evaluating competitors routes and going after those routes which are yielding major revenue. Delta and United both are targeting both AA and US Airways as well as holding their own against airlines such as JetBlue and Southwest Airlines.
Yes, American Airlines and US Airways need each other. American’s operations need US Airways executives who know how to methodically fix operations in a lean manner. US Airways needs American’s hubs and routes to build much better network yield. Yes, US Airways can exist quite nicely as a stand-alone airline. It cannot expect to rise to the scale of the SuperLegacies and compete both domestically and internationally over the long term without a merger.
A combined US Airways / AA company nominally looks like the biggest airline in the world once complete. That won’t necessarily be true. There will be consolidation and rationalization between the two airlines but the entity will be a member of the SuperLegacy group and it will have the potential to compete in the market on a level playing field. That’s all they can ask for.
3 SuperLegacy airlines, Southwest (who doesn’t quite fit into any category now), and a smaller stable of LCC carriers looks about right for the modern competitive landscape. At this point, I actually think we will see increased competition over the long term among the Big 4 and that will be good for the consumer. We will not, however, see that increased competition until there is a Big 4 and until those airlines have time to settle their operations in the new competitive landscape. If the US Airways / AA merger were consummated by the end of 2013, I would expect a rational and highly competitive marketplace to be fully emerged by 2017/2018.
If there is an area where I see reduced competition in the US, it’s among the LCC carriers (and doesn’t include SWA). I think the narrowed gap in costs and differences in revenue models between the LCC carriers and SuperLegacies removes the best business argument for an LCC carrier. It will be a struggle for those carriers in the future and we do need them. On the other hand, if a relatively new LCC carrier with rock bottom costs can’t compete against SuperLegacies, the market place has done its job.
So, no, I do not think the proposed US Airways / American Airlines merger is wrong.
Iran has announced its intention to build a 150 seat single aisle airliner to meet its own (projected) need for 600 airliners in the future and to eliminate the problems in acquiring aircraft from Airbus and Boeing due to sanctions.
This will never happen ever.
Expect Iran to approach China about participating in some small way on the COMAC 919 airliner some time next year. China might even agree to it but I rather doubt it given the US participation in that project. China needs the US way more than it needs the irrational government of Iran.
The APA board has named American Airlines first officer Keith Wilson interim president of the Allied Pilots Association. Interesting to me is that Keith Wilson has been told to work towards getting respect for all the sacrifices made over the past 11 years by AA pilots. Also interesting is the fact that it is Keith Wilson who ran against David Bates in the last APA officer elections.
The patients have taken over the asylum (again) and are asking for all the warm milk and cookies they can get since they had to forgo some of that a while back.
