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Topic: Possible Antitrust Probe Of DL
Username: Triple7LR
Posted 2012-11-02 15:01:34 and read 9552 times.

According to The Hill Delta really upset some folks by canceling MEM-AMS:

http://thehill.com/blogs/floor-actio...-delta-after-tenn-flights-canceled

Topic: RE: Possible Antitrust Probe Of DL
Username: spiritair97
Posted 2012-11-02 15:17:06 and read 9482 times.

Even if they did break a "promise", why should DL keep a route that is losing money and bad for their busineess just to please Memphis? Yes, it is sad to see more widebody and international service leaving MEM, but is it really worth all this trouble?

"On Wednesday, he reiterated arguments that Delta has said Memphis would not lose jobs or flights, "

Did DL really say this? If they did, this probably wasn't very smart to do. And if they saw some potential for MEM at the time, obviously something hsa changed that made it logical to downsize MEM operations.

Topic: RE: Possible Antitrust Probe Of DL
Username: MaverickM11
Posted 2012-11-02 15:19:39 and read 9466 times.

Oh, blackmail. What fun!

Topic: RE: Possible Antitrust Probe Of DL
Username: Triple7LR
Posted 2012-11-02 15:33:37 and read 9350 times.

Personally I thinks it's a little petty on the Congressmans part and I've never heard of a merger that didn't have some job lose.

Topic: RE: Possible Antitrust Probe Of DL
Username: deltaffindfw
Posted 2012-11-02 15:51:00 and read 9241 times.

Every congress member in every state does the same thing for any company that does something detrimental to them. It's the nature of getting re-elected or looking good to your constituents versus the merits of the argument...

Topic: RE: Possible Antitrust Probe Of DL
Username: milesrich
Posted 2012-11-02 16:03:33 and read 9158 times.

Quoting spiritair97 (Reply 1):
"On Wednesday, he reiterated arguments that Delta has said Memphis would not lose jobs or flights, "

Did DL really say this? If they did, this probably wasn't very smart to do. And if they saw some potential for MEM at the time, obviously something hsa changed that made it logical to downsize MEM operations.

I think he is confusing Richard Anderson with a well know major party politician.

Topic: RE: Possible Antitrust Probe Of DL
Username: MSPNWA
Posted 2012-11-02 17:57:04 and read 8781 times.

If was a representative of that area, I'd be pretty upset too. We all know that recent airline acquisitions was primarily to eliminate competition. But they still get approved as long as the airlines say the right things.

Take this note: "The Delta spokesman said the decision to cut direct service to Amsterdam had nothing to do with the merger."

We all know that's a bunch of baloney. The dismantling of the MEM hub, and subsequent MEM-AMS cut, is a direct result of the combined airline.

Topic: RE: Possible Antitrust Probe Of DL
Username: B757forever
Posted 2012-11-02 18:01:57 and read 8751 times.

Quoting MSPNWA (Reply 6):
We all know that's a bunch of baloney. The dismantling of the MEM hub, and subsequent MEM-AMS cut, is a direct result of the combined airline.


How so?

Topic: RE: Possible Antitrust Probe Of DL
Username: mayor
Posted 2012-11-02 18:11:04 and read 8698 times.

Quoting MSPNWA (Reply 6):
If was a representative of that area, I'd be pretty upset too. We all know that recent airline acquisitions was primarily to eliminate competition. But they still get approved as long as the airlines say the right things.

Take this note: "The Delta spokesman said the decision to cut direct service to Amsterdam had nothing to do with the merger."

We all know that's a bunch of baloney. The dismantling of the MEM hub, and subsequent MEM-AMS cut, is a direct result of the combined airline.

What DL HAD said was that no "frontline" jobs would be lost due to the merger and I doubt if there were any as a direct result of the merger, but THAT was 3- 4 years ago. How long will it be before anyone (including on here) stops blaming EVERYTHING on the merger. Is there like a time limit?  


Is DL supposed to keep operating a flight, that is losing money, just because some "thinks" a promise was broken? It was not.......there were no jobs lost, in MEM or systemwide, as a direct result of the merger. Now, 4 years later, they MAY be reducing employees at MEM ( we have heard none of that in this) but are reducing a money losing flight.

[Edited 2012-11-02 18:19:14]

Topic: RE: Possible Antitrust Probe Of DL
Username: thegoldenargosy
Posted 2012-11-02 18:17:35 and read 8655 times.

Just wait, soon it'll be someone bitching about out UA is pulling out of CLE.

Topic: RE: Possible Antitrust Probe Of DL
Username: Newark727
Posted 2012-11-02 18:22:24 and read 8622 times.

Antitrust is a valid issue with any large merger but this just comes off a bit parochial in its concerns. I'm not familiar with antitrust law but it seems as if in this case it isn't so much a lack of competition (that's probably the case with most hub-and-spoke networks at a hub city) but rather redundancy now that the merged carrier has more hubs to choose from. If he was concerned about DL eliminating competition above all there would/should have been more stipulations back when the merger took place about where NW's assets went.

Topic: RE: Possible Antitrust Probe Of DL
Username: jcwr56
Posted 2012-11-02 18:30:00 and read 8588 times.

At the end of the day, being a Congressman has its privileges on being able to call people out on things. In the end, DL will have to appease him somehow especially when political payback might be needed with his House friends from Georgia.

Topic: RE: Possible Antitrust Probe Of DL
Username: MSPNWA
Posted 2012-11-02 19:16:37 and read 8455 times.

Quoting B757forever (Reply 7):
How so?

Do I really need to explain that?

Alright then. Why is MEM being dismantled as a hub? I bet it's because the largest hub in the world is nearby, and so Delta is largely competing against itself for connection service. Of course you don't want to compete against yourself, so one half of the equation goes away to fix that. We would call that collusion if we had still had two separate companies, but now with one, it's fair game.

Quoting mayor (Reply 8):
How long will it be before anyone (including on here) stops blaming EVERYTHING on the merger. Is there like a time limit?

Simple. When there's no more actions that were significantly affected by the acquisition. But don't hold your breath on that. Look at how the AA/TW deal still affects current actions. The ripples last for a long, long time. If an airline doesn't like the feedback, tough beans. They've asked for it.

Topic: RE: Possible Antitrust Probe Of DL
Username: RyanairGuru
Posted 2012-11-02 20:07:54 and read 8289 times.

Quoting deltaffindfw (Reply 4):
Every congress member in every state does the same thing for any company that does something detrimental to them. It's the nature of getting re-elected or looking good to your constituents versus the merits of the argument...

And don't forget the timing... I'm sure they'll be a nice front page article in the Memphis Daily News (replete with a photograph of said Congressman) bashing Delta for destroying Memphis jobs etc etc, very conveniently 3 days before his re-election...

Or am I too cynical  

Topic: RE: Possible Antitrust Probe Of DL
Username: michman
Posted 2012-11-02 20:24:54 and read 8208 times.

Quoting MSPNWA (Reply 12):
Alright then. Why is MEM being dismantled as a hub?

High fuel costs. Limited O & D traffic. Continued economic weakness in the US and the EU. I could go on, but of course the conspiracy theorists will never acknowledge any of these issues. I find it ironic that a member of congress is telling a company how to run their business while the US gov is running trillion+ deficits year after year. If they worked in the business world, they would have sacked years ago for malfeasance.

Topic: RE: Possible Antitrust Probe Of DL
Username: mayor
Posted 2012-11-02 20:26:38 and read 8195 times.

Quoting MSPNWA (Reply 12):
Simple. When there's no more actions that were significantly affected by the acquisition. But don't hold your breath on that. Look at how the AA/TW deal still affects current actions. The ripples last for a long, long time. If an airline doesn't like the feedback, tough beans. They've asked for it.

Knowing your dislike for DL, I expect I'll be dead and buried by that time. The least little thing, that DL does that you don't like, you'll manage to spin it as being a result of the merger.

Topic: RE: Possible Antitrust Probe Of DL
Username: michman
Posted 2012-11-02 20:31:08 and read 8176 times.

Quoting MSPNWA (Reply 12):
Look at how the AA/TW deal still affects current actions.

Yes, let's look at the the AA/TW deal. If not for the AA merger, it was pretty clear that TW was headed for Chapter 7 liquidation. The STL hub would have been dead from the get go, and all the staff would have had to start over from scratch.

Topic: RE: Possible Antitrust Probe Of DL
Username: okie
Posted 2012-11-02 21:17:39 and read 8036 times.

Quoting RyanairGuru (Reply 13):
And don't forget the timing... I'm sure they'll be a nice front page article in the Memphis Daily News (replete with a photograph of said Congressman) bashing Delta for destroying Memphis jobs etc etc, very conveniently 3 days before his re-election...

Or am I too cynical

  

Bingo!!!

This election season is getting ludicrous around here as well. The closer the election date and the worse it gets as the opponent will not have time to respond.

Okie

Topic: RE: Possible Antitrust Probe Of DL
Username: AirAfreak
Posted 2012-11-02 23:14:45 and read 7583 times.

I wonder if the Memphis - Amsterdam flight was cancelled due to low demand ex-Memphis OR due to the inbound flights feeding into Memphis did not carry enough demand to Amsterdam via Memphis?

Could this cancellation be due to an overwhelming number of passenger complaints in regards to their perception of the arrivals/departures facilities at Memphis?

How can Delta bring this flight back to make everyone happy? What needs to be done at Memphis? I'm sure someone at Network Planning can shed some light into what brought this flight to a halt.

(If I answered my own question, then someone please follow-up with facts.) This is an interesting topic to discuss.

Topic: RE: Possible Antitrust Probe Of DL
Username: xjramper
Posted 2012-11-03 00:08:24 and read 7407 times.

I am confused. There are a ton of exUSA flights to AMS on DL. I cannot imagine that DL would suspend this service without some serious thought if the loads were completely dependent on O&D travel. With flights originating from ATL/DTW/MSP/BOS/NYC/PDX/SEA, this is hardly an anti-trust issue.

Also, no offence to the MEM folks, but out of the NW hubs MEM was(is) my least favourite, strictly based on type of aircraft available into that city. Heck I even punish myself by flying into and out of NYC just to avoid a trip through MEM. Which is sad because if you are routed through MEM, you avoid a FAC fee (usually $5).

Having never using MEM customs, I cannot directly answer that question, but I cannot imagine a worse CBP/FIS facility than JFK T3.

But back to the OP. To me it seems to be politically driven, rather than strictly an anti-trust issue. You may get to AMS via almost every city DL flies non-stop to, along with a lot of other KLM connections with the JV.

Topic: RE: Possible Antitrust Probe Of DL
Username: rwy04lga
Posted 2012-11-03 00:52:22 and read 7289 times.

Quoting MSPNWA (Reply 6):
We all know that recent airline acquisitions was primarily to eliminate competition.

We do?

Quoting MSPNWA (Reply 6):
We all know that's a bunch of baloney.

The only thing we (everyone but you) ALL know is that NWA doesn't exist anymore...not at MSP, MEM, or anywhere else.

Please speak for yourself. WE don't need you to tell us ALL how to think or what to think.

Topic: RE: Possible Antitrust Probe Of DL
Username: milesrich
Posted 2012-11-03 01:22:11 and read 7184 times.

Quoting jcwr56 (Reply 11):
At the end of the day, being a Congressman has its privileges on being able to call people out on things. In the end, DL will have to appease him somehow especially when political payback might be needed with his House friends from Georgia.

I don't think you understand how Congress, and especially the House of Representatives works. Steve Cohen, who represents Shelby County (Memphis) Tennessee in the House of Representatives, is a Jewish Democrat. Of Georgia's 13 Congressional Districts, there are five Democrats and eight Republicans. Of the Five Democrats, only one is white, and he has been redistricted and will be probably be defeated next week, plus Georgia picked up a seat so the new line up will be Four Democrats, all of whom are black and represent the City of Atlanta, and areas around it, and 10 Republicans. Now which one of these members of the House are going to help out Steve Cohen? NONE. And the Majority Republicans are not going to touch a complaint like this with a ten foot pole.

Topic: RE: Possible Antitrust Probe Of DL
Username: jcwr56
Posted 2012-11-03 03:01:23 and read 6918 times.

Quoting milesrich (Reply 21):

Oh I know exactly how Congress works and let me tell you, being Jewish, Black or any race has little to do with it. In Congress you're in a members only club and at times they do take care of each other regardless of political sides.

Topic: RE: Possible Antitrust Probe Of DL
Username: yellowtail
Posted 2012-11-03 06:55:55 and read 6088 times.

Quoting thegoldenargosy (Reply 9):
Just wait, soon it'll be someone bitching about out UA is pulling out of CLE.

or IAH-CDG getting cancelled cause of the merger.

Quoting AirAfreak (Reply 18):
What needs to be done at Memphis? I'm sure someone at Network Planning can shed some light into what brought this flight to a halt.

Who needs NP? It got canned cause it wasn't working and wasn't in thier strategic plan going forward.

Topic: RE: Possible Antitrust Probe Of DL
Username: milesrich
Posted 2012-11-03 09:18:28 and read 5290 times.

Quoting jcwr56 (Reply 22):
Oh I know exactly how Congress works and let me tell you, being Jewish, Black or any race has little to do with it. In Congress you're in a members only club and at times they do take care of each other regardless of political sides.

No offense, but I think you have been in a political coma since 1994 when Newt Gingrich engineered the GOP takeover of the House of Representatives. Cohen is just blabbering for his own political purposes. He is a white Southern Democrat, a vanishing species, and he represents a very large black population, Harold Ford's old Congressional Seat. No Congressman in Georgia is going to go after Delta Air Lines, one of if not Georgia's largest payroll producer, let alone do anything to hurt Delta's hub operation at Hartsfield JACKSON.

Topic: RE: Possible Antitrust Probe Of DL
Username: B757forever
Posted 2012-11-03 09:32:45 and read 5412 times.

Quoting MSPNWA (Reply 12):
Do I really need to explain that?



Sure, give it a try. How would you maintain a hub with low O&D and very high fuel costs?

Topic: RE: Possible Antitrust Probe Of DL
Username: FI642
Posted 2012-11-03 09:40:39 and read 5340 times.

Why was anyone surprised to see this happen? Some were surprised it lasted as long as it did.

Topic: RE: Possible Antitrust Probe Of DL
Username: PHX787
Posted 2012-11-03 11:40:16 and read 4797 times.

Quoting Triple7LR (Thread starter):
According to The Hill Delta really upset some folks by canceling MEM-AMS:

DL upset quite a lot of people across the board, especially at MEM and CVG. I had a feeling this was coming for a while, especially after I took a unit on anti-trust politics in school. There are also some lawyers in Cincinnati, by the way, who have been doing some research into DL's policies at those airports, to see if it does break anti-trust laws....but at the same time, it's a very complicated situation. MEM, MSP, and DTW were NW's hubs, which DL bought in the merger. There is so much overlay from this merger so many analysts thought that hub downsizing was inevitable, but what's the legality behind it?

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-03 11:50:15 and read 4729 times.

Quoting PHX787 (Reply 27):
There is so much overlay from this merger so many analysts thought that hub downsizing was inevitable, but what's the legality behind it?

Cutting service would almost never violate competition law.

Topic: RE: Possible Antitrust Probe Of DL
Username: Mir
Posted 2012-11-03 11:54:15 and read 4716 times.

If DL never agreed to anything with the DOT relating to retaining capacity out of MEM as a condition of the merger (and I don't believe they did), then he's got no case. DL can promise that jobs and flights won't be cut, but all you had to do was look at the state of the airline and you'd see that they weren't being honest about that.

Quoting MSPNWA (Reply 6):
Take this note: "The Delta spokesman said the decision to cut direct service to Amsterdam had nothing to do with the merger."

We all know that's a bunch of baloney. The dismantling of the MEM hub, and subsequent MEM-AMS cut, is a direct result of the combined airline.

   The writing was on the wall for this the moment the merger was announced. There was no way MEM would stay around with ATL still there.

Quoting RyanairGuru (Reply 13):
And don't forget the timing... I'm sure they'll be a nice front page article in the Memphis Daily News (replete with a photograph of said Congressman) bashing Delta for destroying Memphis jobs etc etc, very conveniently 3 days before his re-election...

Or am I too cynical

Well, the cut was announced recently. So it's not like he's had months to say something about it but is just speaking out now.

Quoting B757forever (Reply 25):
How would you maintain a hub with low O&D and very high fuel costs?

You don't, unless you have no other hub geographically close that can pick up the lost feed. Which was the case with NW, but not the case with DL.

-Mir

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-03 12:07:06 and read 4635 times.

Quoting Mir (Reply 29):
There was no way MEM would stay around with ATL still there.

There was a way, just not a way that panned out: 4 percent annual GDP growth and $40 oil. (Somewhat smaller growth numbers and higher oil prices would work too.)

Topic: RE: Possible Antitrust Probe Of DL
Username: DeltaMD90
Posted 2012-11-03 12:12:16 and read 4617 times.

Quoting PHX787 (Reply 27):
There are also some lawyers in Cincinnati, by the way, who have been doing some research into DL's policies at those airports, to see if it does break anti-trust laws....

Kinda silly... JFK posed a significant threat to CVG. DTW undoubtedly made things worse, but I don't really see how CVG would survive fully with the JFK and LGA expansion. Had the merger not happened, I wonder what CVG would look like today... (better but not that great and trending down I think)

Topic: RE: Possible Antitrust Probe Of DL
Username: Mir
Posted 2012-11-03 12:15:25 and read 4597 times.

Quoting DeltaMD90 (Reply 31):
JFK posed a significant threat to CVG. DTW undoubtedly made things worse

DTW killed CVG off, not NYC.

-Mir

Topic: RE: Possible Antitrust Probe Of DL
Username: PHX787
Posted 2012-11-03 12:47:57 and read 4441 times.

Quoting Mir (Reply 32):
Quoting DeltaMD90 (Reply 31):
JFK posed a significant threat to CVG. DTW undoubtedly made things worse

DTW killed CVG off, not NYC.

   despite DL's promises to KCAB, we all knew that the downsizing was going to happen, but we're equally as pissed as travelers. We're just glad that P&G subsidizes our international service.

Topic: RE: Possible Antitrust Probe Of DL
Username: DeltaMD90
Posted 2012-11-03 14:44:06 and read 3825 times.

Quoting Mir (Reply 32):
DTW killed CVG off, not NYC.

Yes I know that and stated that. I am saying that in a non-merged DL I think we'd see JFK/LGA start eating away at CVG (not at the rate we see now but I don't think it would be as large as some people would like)

Topic: RE: Possible Antitrust Probe Of DL
Username: flyguy89
Posted 2012-11-03 15:05:58 and read 3727 times.

Quoting DeltaMD90 (Reply 34):
Quoting Mir (Reply 32):
DTW killed CVG off, not NYC.

Yes I know that and stated that. I am saying that in a non-merged DL I think we'd see JFK/LGA start eating away at CVG (not at the rate we see now but I don't think it would be as large as some people would like)

I don't think so, DL was already down-sizing CVG pre-merger so I agree with you that absent a NW merger, CVG would have been smaller than before, probably around ~350-400 daily flights. But JFK/LGA don't really compete with the traffic flows that CVG served (i.e. DSM-ORF or LAX-FWA) and CVG's TATL routes were always comparatively fewer and only to the largest European cities, not really competitive with JFK.

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-03 15:40:41 and read 3609 times.

Quoting flyguy89 (Reply 35):
absent a NW merger, CVG would have been smaller than before, probably around ~350-400 daily flights.

The more interesting question is whether the poor economics of 50 seat CRJs would have killed CVG absent a merger. Before the DL/NW merger, no legacy really tried to be all things to all people, so I might argue that CVG would not have remained only to serve traffic flows like DSM-ORF or LAX-FWA, flows on which DL was likely at a significant cost disadvantage to UA, NW and perhaps even AA.

Topic: RE: Possible Antitrust Probe Of DL
Username: flyguy89
Posted 2012-11-03 15:54:04 and read 3564 times.

Quoting Cubsrule (Reply 36):
Quoting flyguy89 (Reply 35):
absent a NW merger, CVG would have been smaller than before, probably around ~350-400 daily flights.

The more interesting question is whether the poor economics of 50 seat CRJs would have killed CVG absent a merger.

Oh that definitely would have been a major hurdle, but I don't think so. CVG did well as a hub for about 10 years before the 50-seat RJ made it's debut with Comair. If I had to guess, props would have probably replaced the bulk of the short hop flying as was the case before the CRJ.

Quoting Cubsrule (Reply 36):
so I might argue that CVG would not have remained only to serve traffic flows like DSM-ORF or LAX-FWA, flows on which DL was likely at a significant cost disadvantage to UA, NW and perhaps even AA.

I don't really see how they would have been at a cost disadvantage. There are so many variables that would come into play, but are we talking about a CVG hub if NO mergers at all had taken place? In any case, CVG did serve a purpose in the PMDL network, it was DL's ORD and without it they would have had a negligible to non-existent presence in one of the most populous areas of the country, a region where every other carrier had a presence in.

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-03 16:48:51 and read 3465 times.

Quoting flyguy89 (Reply 37):
In any case, CVG did serve a purpose in the PMDL network, it was DL's ORD and without it they would have had a negligible to non-existent presence in one of the most populous areas of the country, a region where every other carrier had a presence in.

Oh, I agree. The question is whether RJ economics would have gotten so bad at some point that we would have seen CVG cut back to 150-200 flights. Remember that today - even at its much reduced size - CVG still serves many of the flows we are discussing.

Topic: RE: Possible Antitrust Probe Of DL
Username: mayor
Posted 2012-11-03 20:13:25 and read 3259 times.

I'll say it again.......if a route, flight or city is cut from the system, say, 20 years down the road, does that qualify as being a result of the merger?   Are there any route decisions, made today, that are the result of the C&S, NE or WA mergers? No? Didn't think so.

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-03 20:28:33 and read 3258 times.

Quoting mayor (Reply 39):
Are there any route decisions, made today, that are the result of the C&S, NE or WA mergers?

Today, no, but when was LAX-GDL cut? It was more than a decade after the WA merger and was arguably cut as a result of the merger.

AA took close to a decade to pare STL down after the TW merger.

Topic: RE: Possible Antitrust Probe Of DL
Username: PHX787
Posted 2012-11-03 20:29:02 and read 3246 times.

Quoting Cubsrule (Reply 38):
Oh, I agree. The question is whether RJ economics would have gotten so bad at some point that we would have seen CVG cut back to 150-200 flights. Remember that today - even at its much reduced size - CVG still serves many of the flows we are discussing.

I honestly think that w/o the merger and WITH the 50-seaters retiring, DL would've probably updated OH's fleet to something more profitable. Sure flights would be lost but as stated above by someone else it would probably be between 250-350/day.

Topic: RE: Possible Antitrust Probe Of DL
Username: Mir
Posted 2012-11-03 21:51:40 and read 3153 times.

Quoting mayor (Reply 39):
I'll say it again.......if a route, flight or city is cut from the system, say, 20 years down the road, does that qualify as being a result of the merger?

20 years from now, probably not. But we're not even 10 years removed from the merger.

-Mir

Topic: RE: Possible Antitrust Probe Of DL
Username: PHX787
Posted 2012-11-04 00:09:27 and read 3052 times.

Quoting Mir (Reply 43):
20 years from now, probably not. But we're not even 10 years removed from the merger.

We're barely 4 in fact. IIRC it was announced in 2008 and finalized in 2010.

Topic: RE: Possible Antitrust Probe Of DL
Username: delta2ual
Posted 2012-11-04 06:31:03 and read 2870 times.

Quoting Mir (Reply 29):
If DL never agreed to anything with the DOT relating to retaining capacity out of MEM as a condition of the merger (and I don't believe they did), then he's got no case. DL can promise that jobs and flights won't be cut, but all you had to do was look at the state of the airline and you'd see that they weren't being honest about that.

That's why airlines (actually every corporation) always adds "at this time". Where I work, everytime someone asks a question about furloughs, we are told by our leaders "we don't anticipate any layoffs at this time". I highly doubt DL ever said "as a result of this merger, we don't anticipate any furloughs, base closures, or hub reductions EVER".

Topic: RE: Possible Antitrust Probe Of DL
Username: mayor
Posted 2012-11-04 14:04:47 and read 2599 times.

Quoting Mir (Reply 42):
Quoting mayor (Reply 39):
I'll say it again.......if a route, flight or city is cut from the system, say, 20 years down the road, does that qualify as being a result of the merger?

20 years from now, probably not. But we're not even 10 years removed from the merger.

What I'm getting at is, WHEN does an action cease to be as a result of the merger?

Quoting Cubsrule (Reply 40):
Quoting mayor (Reply 39):
Are there any route decisions, made today, that are the result of the C&S, NE or WA mergers?

Today, no, but when was LAX-GDL cut? It was more than a decade after the WA merger and was arguably cut as a result of the merger.

I believe it was cut before I retired in '05, but how is that a result of the WA merger? True, DL wouldn't have had the route, in the first place, if they hadn't merged, BUT there are any number of other reasons the route was cut, not even related to the merger.

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-04 14:39:21 and read 2566 times.

Quoting mayor (Reply 45):
True, DL wouldn't have had the route, in the first place, if they hadn't merged, BUT there are any number of other reasons the route was cut, not even related to the merger.

I'd suggest that that is exactly the situation with MEM-AMS or, if you think that is too far removed from the merger, routes like ATL-PVG. The picture changes little. All that changes is the passage of time.

Topic: RE: Possible Antitrust Probe Of DL
Username: mayor
Posted 2012-11-04 14:50:41 and read 2548 times.

Quoting Cubsrule (Reply 46):
I'd suggest that that is exactly the situation with MEM-AMS or, if you think that is too far removed from the merger, routes like ATL-PVG. The picture changes little. All that changes is the passage of time.

ATL-PVG could have been cut, merger or not. The only connection that MEM-AMS has with the merger is that it was a NW route, but the reason it was cut, is because it hasn't been doing well. Besides, if the people in MEM need to go to AMS, there are any number of ways they can get there.....it just won't be a non-stop.

Topic: RE: Possible Antitrust Probe Of DL
Username: PHX787
Posted 2012-11-04 14:56:08 and read 2519 times.

Quoting mayor (Reply 45):
What I'm getting at is, WHEN does an action cease to be as a result of the merger?

IMO after all the cuts that happen immediately after the merger happens cease, or when the airline begins expanding into further markets beyond what was acquired in the merger. In DL's case they were working on NYC for quite some time before the merger happened.

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-04 15:01:13 and read 2528 times.

Quoting mayor (Reply 47):
The only connection that MEM-AMS has with the merger is that it was a NW route, but the reason it was cut, is because it hasn't been doing well.

ATL-PVG did well?

Quoting mayor (Reply 47):
Besides, if the people in MEM need to go to AMS, there are any number of ways they can get there.....it just won't be a non-stop.

Likewise, if people in ATL need to go to PVG, there are any number of ways they can get there . . . just not nonstop.

If anything, the merger gave MEM-AMS a stay of execution because the route was far more likely to work on a 767 than on a D10 or 330.

Topic: RE: Possible Antitrust Probe Of DL
Username: mayor
Posted 2012-11-04 17:14:13 and read 2384 times.

Quoting Cubsrule (Reply 49):
ATL-PVG did well?

Where did I say that? I think I indicated that ATL-PVG would have been cut, merger or no merger and the merger wouldn't have been the reason.

Quoting Cubsrule (Reply 49):
If anything, the merger gave MEM-AMS a stay of execution because the route was far more likely to work on a 767 than on a D10 or 330.

So, then I'm right. The merger was the reason that it was given a stay of execution, but not the reason it was cut?

Topic: RE: Possible Antitrust Probe Of DL
Username: Mir
Posted 2012-11-04 17:21:25 and read 2366 times.

Quoting mayor (Reply 45):
What I'm getting at is, WHEN does an action cease to be as a result of the merger?

That's a subjective question - it depends on the route. But it's pretty clear that the drawdown of a hub acquired by merger in close proximity to a larger pre-existing hub is merger-related.

Quoting mayor (Reply 47):
The only connection that MEM-AMS has with the merger is that it was a NW route, but the reason it was cut, is because it hasn't been doing well.

Because the hub was being drawn down. You're never going to fill that route on O&D alone, so you need good connecting feed in MEM in order to make the route work. If you're drawing down MEM because of ATL's presence (i.e. because of the merger), then you're not going to have that feed and the route won't do well. But it's still related to the merger.

-Mir

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-04 18:11:26 and read 2290 times.

Quoting mayor (Reply 50):
I think I indicated that ATL-PVG would have been cut, merger or no merger and the merger wouldn't have been the reason.

Why do you think that? It was PMDL's only way to access China. It was more indispensible than MEM-AMS.

Quoting mayor (Reply 50):
The merger was the reason that it was given a stay of execution, but not the reason it was cut?

I never said the merger was the reason it was given a stay of execution. It was cut because the merger made it - and MEM in general - unnecessary, just like the merger made ATL-PVG unnecessary.

Topic: RE: Possible Antitrust Probe Of DL
Username: mayor
Posted 2012-11-04 19:30:15 and read 2150 times.

Quoting Cubsrule (Reply 52):

Ok.....lets put it this way. How long should an airline maintain a route that is losing money, without worrying whether the reasons were merger related or not? How long should you wait if some Congressman, who probably couldn't find his butt with both hands, starts to ask completely irrelevant and uninformed questions, hmmmmm?


Did DL EVER say that their would be NEVER be a drawdown in MEM or that routes from MEM would NEVER be cut or did they just say that there would be no cutbacks in frontline employees, due to the merger (never implying that it might not ever happen)? I seem to remember the latter.

Topic: RE: Possible Antitrust Probe Of DL
Username: Flighty
Posted 2012-11-04 19:42:19 and read 2132 times.

I think it is important to remember that, yes, the scenario that played out at MEM does demonstrate precisely why approving the DL/NW merger was no slam dunk.

On some level, we all know that allowing unfettered mergers will result in higher prices and higher profits for airlines. The exact mechanics of this involve acquiring and dismantling competitive hubs. The DOJ has always known this, and has always had ample statutes to control it. If they are so motivated.

Topic: RE: Possible Antitrust Probe Of DL
Username: toobz
Posted 2012-11-05 01:50:31 and read 2002 times.

It's so strange people get upset over things like this. DL wouldn't be cutting the route if it was making money. Why would they!? Should they keep it just to satisfy the airport, city or state? If they really appreciated it, they would speak with their wallets. Obviously DL didn't think they were..

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-05 05:18:58 and read 1964 times.

Quoting mayor (Reply 55):
How long should an airline maintain a route that is losing money, without worrying whether the reasons were merger related or not?

It shouldn't. That was sort of my point. It's not like there's some point at which the merger is magically no longer relevant to network planning.

Topic: RE: Possible Antitrust Probe Of DL
Username: Mir
Posted 2012-11-05 06:29:03 and read 1957 times.

Quoting toobz (Reply 57):
It's so strange people get upset over things like this. DL wouldn't be cutting the route if it was making money. Why would they!? Should they keep it just to satisfy the airport, city or state? If they really appreciated it, they would speak with their wallets. Obviously DL didn't think they were..

Here's why that logic doesn't really work in this case: that route was doomed the moment the merger happened. MEM could never support the flight on their own, and DL was going to draw down the MEM hub anyway because of ATL's presence nearby, getting rid of the feed the flight would need to be successful. Unless everyone in MEM was going to be expected to start flying to Europe more to compensate and show their appreciation (which is pretty unreasonable), the route was going to go.

That said, unless DL made some agreement with the DOT to keep that route around as a condition of receiving approval for the merger or for something else, there is no case against them. But I can understand how people in MEM would be irritated by the downsizing of their hub.

-Mir

Topic: RE: Possible Antitrust Probe Of DL
Username: RDH3E
Posted 2012-11-05 07:34:46 and read 1946 times.

Quoting PHX787 (Reply 43):
We're barely 4 in fact. IIRC it was announced in 2008 and finalized in 2010.

It depends what you mean by finalized. You could look at it a couple ways...

"On September 26, 2008 it was announced that both Delta and Northwest's shareholders had approved the merger.[8]"

"On October 29, 2008, the United States Department of Justice approved Delta's plan to acquire Northwest.[15]"

"Both Delta's and Northwest's operating certificates were merged on December 31, 2009. From a technical standpoint, Northwest has ceased to exist as an independent carrier. Ground operations and reservations systems was later combined on January 31, 2010."

Personally I'd say that if was finalized in 2008 with the DOJ approval. SOC isn't really the "finalization" of the merger.

Topic: RE: Possible Antitrust Probe Of DL
Username: DTWPurserBoy
Posted 2012-11-05 07:51:12 and read 1952 times.

Also, DL likes to play MEM against the ATL Airport Authority--especially when negotiating lease rates. Remember a couple of years ago when they threatened to move all of the caribbean flying out of ATL to MEM due to cheaper lease rates? With the public support of the MEM business community, DL was able to negotiate the facility lease rates it wanted to pay in ATL. It would be just as convenient to channel passengers thru MEM on their way to the caribbean and Central America as it would be through ATL. DL is not afraid to use their power when they need to do so.

DL moves/cancels/reinstates flights whenever it sees an opportunity for a better yield elsewhere. In the end it all boils down to yield management.

Topic: RE: Possible Antitrust Probe Of DL
Username: PHX787
Posted 2012-11-05 09:57:33 and read 1943 times.

Quoting RDH3E (Reply 58):
Personally I'd say that if was finalized in 2008 with the DOJ approval. SOC isn't really the "finalization" of the merger.

Still it is a short time. For lawyers sake, DL would not immediately axe and merge CVG and MEM to ATL and DTW, because that would result in the anti-trust officials going haywire.

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-05 10:02:27 and read 1934 times.

Quoting PHX787 (Reply 60):
For lawyers sake, DL would not immediately axe and merge CVG and MEM to ATL and DTW, because that would result in the anti-trust officials going haywire.

Why? Again, it's not usually anticompetitive to cut service.

Topic: RE: Possible Antitrust Probe Of DL
Username: PHX787
Posted 2012-11-05 10:03:57 and read 1936 times.

Quoting Cubsrule (Reply 61):
Why? Again, it's not usually anticompetitive to cut service.

But after promising to keep service? Here's the thing- we need to figure out what kinds of "promises" that DL made to CVG and MEM regarding their service post-merger. If you ask me, if you actually need to make "promises" to these airports to keep service and not to the other airports, that's a bit sketchy to me.

Topic: RE: Possible Antitrust Probe Of DL
Username: enilria
Posted 2012-11-05 10:12:32 and read 1934 times.

This is all political, but I do think if we are going to have 3 airlines in this country, there should be periodic anti-trust review of the remaining players.

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-05 10:53:35 and read 1929 times.

Quoting PHX787 (Reply 62):
But after promising to keep service?

You need to separate "anticompetitive" - which is an antitrust law issue - with "anticonsumer" - which is not. Cutting routes doesn't present any antitrust law problems. It may be undesirable for other reasons, and some might think that those other reasons justify government intervention.

Topic: RE: Possible Antitrust Probe Of DL
Username: PSU.DTW.SCE
Posted 2012-11-05 11:06:26 and read 1935 times.

Absent a merger, it unknown how an independent DL and independent NW would've made it through the aftermath of the economic downturn, the run-up in fuel prices, the Japan Earthquake, and the European economic crisis.

All of these could've let to further consequences in each carrier's network and size.

There is no indication that things would've been better without a merger, and could've in fact been worse.

Topic: RE: Possible Antitrust Probe Of DL
Username: MSPNWA
Posted 2012-11-06 00:53:38 and read 1916 times.

Quoting Cubsrule (Reply 61):
Why? Again, it's not usually anticompetitive to cut service.

Where it can be anti-competitive is when you buy out a competitor and use that acquisition to cut service and therefore competition. We're seeing that all across the airline industry now in combination with natural supply cuts. Of course it's all after the fact and shrouded in many economic factors, so the airlines are essentially immune from any penalty.

I do find it interesting that the DoJ thought AT&T buying T-Mobile went too far in the mobile world. Looking back, I believe that it should have done the same with DL/NW and UA/CO.

Quoting PSU.DTW.SCE (Reply 65):
There is no indication that things would've been better without a merger, and could've in fact been worse.

Of course we will never know concretely, but the evidence with MEM is pretty clear. It undoubtedly would have been better off without the acquisition. Even with the economic roller coaster, MEM didn't see major cuts until 2011, after the worst had passed. Throughout the economic troubles, the hub airline there didn't see MEM as a problem to its bottom line.

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-06 05:16:57 and read 1918 times.

Quoting MSPNWA (Reply 66):
Where it can be anti-competitive is when you buy out a competitor and use that acquisition to cut service and therefore competition.

No, again, cutting service is not generally anticompetitive because cuts theoretically make it easier for others to start service. That theory doesn't always work in practice, which is why I say there are other issues.

Quoting MSPNWA (Reply 66):
I do find it interesting that the DoJ thought AT&T buying T-Mobile went too far in the mobile world. Looking back, I believe that it should have done the same with DL/NW and UA/CO.

That is a concentration argument, which is different and is something addressed by competition law.

Topic: RE: Possible Antitrust Probe Of DL
Username: DeltaMD90
Posted 2012-11-06 08:54:10 and read 1912 times.

Quoting MSPNWA (Reply 66):
I do find it interesting that the DoJ thought AT&T buying T-Mobile went too far in the mobile world. Looking back, I believe that it should have done the same with DL/NW and UA/CO.

Well back then the airlines were struggling to make money. I'm not saying consolidation made all the difference, but it at least created a healthy environment. I think there's a good balance between competition and business now. Let's face it, not every city can be a hub. It would be nice to go back to the old days, but the world has changed and at least for now, the old days are unsustainable today

Topic: RE: Possible Antitrust Probe Of DL
Username: PHX787
Posted 2012-11-06 09:51:39 and read 1905 times.

Quoting MSPNWA (Reply 66):

It is also anti-competitive when you use predatory tactics to drive out other airlines while continuing to slash service and raise prices.

Topic: RE: Possible Antitrust Probe Of DL
Username: Flighty
Posted 2012-11-06 10:18:51 and read 1910 times.

Quoting MSPNWA (Reply 66):
I do find it interesting that the DoJ thought AT&T buying T-Mobile went too far in the mobile world. Looking back, I believe that it should have done the same with DL/NW and UA/CO.

That event was *particularly* interesting, yes. It showed they do have a functioning office for network antitrust issues. DL-NW was iffy. Losses in the industry justified it... not the merits alone. The law is designed to protect consumers. Consumers were harmed. Therefore the law has teeth. DLNW-US would have been a no-go in my opinion. Monopoly of the whole legacy Southeast ex Florida? The more yields rise in the industry, barriers to entry at large airports will be scrutinized most carefully by DOJ. Or that is my expectation.

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-06 10:20:56 and read 1909 times.

Quoting PHX787 (Reply 69):
It is also anti-competitive when you use predatory tactics to drive out other airlines while continuing to slash service and raise prices.

What law does slashing service and raising prices violate?

Topic: RE: Possible Antitrust Probe Of DL
Username: PHX787
Posted 2012-11-06 10:34:15 and read 1909 times.

Quoting Cubsrule (Reply 71):
What law does slashing service and raising prices violate?

Anti-trust laws are extremely complicated. One can lawsuit on pretty much anything. A quick look at wiki will show you what kinds of options CVG has, for example. And MEM is getting its service slashed while having the highest fares in the country. Something definitely is not fair here.

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-06 10:38:57 and read 1909 times.

Quoting PHX787 (Reply 72):
Anti-trust laws are extremely complicated.

I'm familiar with them. I have studied and worked in the field. I don't believe that cutting service and raising prices (by itself) is illegal. You evidently disagree, and I'd like to know why.

Quoting PHX787 (Reply 72):
One can lawsuit on pretty much anything.

That does not mean, however, that one can succeed in any lawsuit.

Topic: RE: Possible Antitrust Probe Of DL
Username: TVNWZ
Posted 2012-11-06 10:46:03 and read 1907 times.

Quoting PHX787 (Reply 69):
It is also anti-competitive when you use predatory tactics to drive out other airlines while continuing to slash service and raise prices.

How can you have a predatory tactic by slashing service and raising prices. I have only seen it work the other way: add service to the extreme and lower prices, thus accepting losses to make it prohibitively expensive for a competitor to operate. How does that work, precisely?

Quoting PHX787 (Reply 72):
And MEM is getting its service slashed while having the highest fares in the country. Something definitely is not fair here.

And any airline is free to enter the market with more service and lower fares.

Topic: RE: Possible Antitrust Probe Of DL
Username: phxa340
Posted 2012-11-06 11:13:22 and read 1906 times.

Quoting PHX787 (Reply 72):
And MEM is getting its service slashed while having the highest fares in the country. Something definitely is not fair here.

Then stop paying the high fares. Obviously the market is OK with the high fares or they would stop paying them and utilize alternative airports or other modes of transportation. Economics 101. Airline travel is not a necessity but a luxury. What exactly is not fair about it ?

Topic: RE: Possible Antitrust Probe Of DL
Username: PHX787
Posted 2012-11-06 15:53:43 and read 1905 times.

Quoting TVNWZ (Reply 74):
How can you have a predatory tactic by slashing service and raising prices. I have only seen it work the other way: add service to the extreme and lower prices, thus accepting losses to make it prohibitively expensive for a competitor to operate. How does that work, precisely?

You're not really too familiar with the plight of the frequent flier out of CVG. We've dealt with lack of service quality and extreme expenses over the last few years. If DL is trying to attract more customers to CVG from competing airports, they're doing a horrible job at it. I'm about to actually schedule my Christmas flight on US to IND simply because I can't find anything decent to fly home with given my school schedule.

Quoting TVNWZ (Reply 74):
And any airline is free to enter the market with more service and lower fares.

And DL will force those airlines out.

Topic: RE: Possible Antitrust Probe Of DL
Username: TVNWZ
Posted 2012-11-06 16:03:41 and read 1904 times.

Quoting PHX787 (Reply 76):
You're not really too familiar with the plight of the frequent flier out of CVG.

Actually, I am.

Quoting PHX787 (Reply 76):
We've dealt with lack of service quality and extreme expenses over the last few years

I think you have a lot of service, just not as much as you used to have. That is the plight of several cities.

Quoting PHX787 (Reply 76):
And DL will force those airlines out.

That might be conjecture. Have they done that since the draw downs? You have more service than most cities your size. How is that anti-competitive? AA fled STL. And as it petered out, WN stepped in.

The market will decide what the market will bear.

Topic: RE: Possible Antitrust Probe Of DL
Username: mayor
Posted 2012-11-06 16:55:25 and read 1904 times.

Quoting PHX787 (Reply 76):
Quoting TVNWZ (Reply 74):
How can you have a predatory tactic by slashing service and raising prices. I have only seen it work the other way: add service to the extreme and lower prices, thus accepting losses to make it prohibitively expensive for a competitor to operate. How does that work, precisely?

You're not really too familiar with the plight of the frequent flier out of CVG. We've dealt with lack of service quality and extreme expenses over the last few years. If DL is trying to attract more customers to CVG from competing airports, they're doing a horrible job at it. I'm about to actually schedule my Christmas flight on US to IND simply because I can't find anything decent to fly home with given my school schedule.

But that's not a predatory tactic, is it? To be predatory, they would have to be trying to drive another carrier out. Has that happened in CVG? NO, it hasn't. A predatory tactic would be slashing fares and increasing service and that's not happening, is it?

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-06 18:12:21 and read 1901 times.

Quoting PHX787 (Reply 76):
And DL will force those airlines out.

. . . and that, if it happens, is anticompetitive. But it has not happened yet.

Quoting TVNWZ (Reply 77):
AA fled STL. And as it petered out, WN stepped in.

Careful. WN was already fairly large at STL before AA killed the hub. In, say, 2008, AA was around 200-250daily flights and WN was at about 80-85.

Topic: RE: Possible Antitrust Probe Of DL
Username: MSPNWA
Posted 2012-11-06 18:59:21 and read 1897 times.

Quoting Cubsrule (Reply 67):
No, again, cutting service is not generally anticompetitive because cuts theoretically make it easier for others to start service. That theory doesn't always work in practice, which is why I say there are other issues.

Cutting service alone is not illegal. It's how you do it that could be. I think we're in agreement on that.

Quoting Cubsrule (Reply 67):
That is a concentration argument, which is different and is something addressed by competition law.

Different? When competition law is antitrust law?

Quoting DeltaMD90 (Reply 68):
Well back then the airlines were struggling to make money. I'm not saying consolidation made all the difference, but it at least created a healthy environment. I think there's a good balance between competition and business now. Let's face it, not every city can be a hub. It would be nice to go back to the old days, but the world has changed and at least for now, the old days are unsustainable today
Quoting Flighty (Reply 70):
Losses in the industry justified it... not the merits alone.

Looking back, we shouldn't have believed that mergers were the only way to keep the industry alive. The bottom line is that virtually all carriers, merged or not, have rebounded and are doing very well. I believe that airlines would be making good profits regardless. Likely not as big, but still solid.

Quoting PHX787 (Reply 69):
It is also anti-competitive when you use predatory tactics to drive out other airlines while continuing to slash service and raise prices.

It may be anti-competitive, but there's nothing illegal about that.

Topic: RE: Possible Antitrust Probe Of DL
Username: texan
Posted 2012-11-06 19:03:05 and read 1896 times.

Quoting MSPNWA (Reply 80):
It may be anti-competitive, but there's nothing illegal about that.

It can be illegal if it is predatory, as PHX787 claims. It is almost impossible to prove, but the predation (predatory pricing) law claim can move forward. The Spirit v Northwest case illustrated that. But, again, it is very unlikely.

Texan

Topic: RE: Possible Antitrust Probe Of DL
Username: Cubsrule
Posted 2012-11-06 19:15:19 and read 1894 times.

Quoting texan (Reply 81):
The Spirit v Northwest case illustrated that. But, again, it is very unlikely.

AA v. Ozark II also.

Topic: RE: Possible Antitrust Probe Of DL
Username: mayor
Posted 2012-11-06 19:38:47 and read 1894 times.

Quoting texan (Reply 81):
It can be illegal if it is predatory, as PHX787 claims. It is almost impossible to prove, but the predation (predatory pricing) law claim can move forward. The Spirit v Northwest case illustrated that. But, again, it is very unlikely.

But, since we're talking about MEM (and throwing in CVG for good measure), the fact is that fares are HIGHER in those two cities and the operation has been downsized. Hardly a recipe for "predatory" actions, is it?


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