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Airtran Circling Rival  
User currently offlineQuickmover From United States of America, joined Mar 2004, 2494 posts, RR: 0
Posted (9 years 1 month 2 weeks 15 hours ago) and read 5387 times:

Interesting article

http://www.thedeal.com/NASApp/cs/CS?pagename=CBS&cid=1124206472416

50 replies: All unread, showing first 25:
 
User currently offline7E72004 From United States of America, joined Mar 2004, 3587 posts, RR: 2
Reply 1, posted (9 years 1 month 2 weeks 13 hours ago) and read 5164 times:

I think AirTran and Midwest would be a good match...it would give them the 2nd hub they need at MKE. I wonder how NW would react considering they have a focus city at MKE  Smile


The next generation of aircraft is just around the corner!
User currently offlineDrerx7 From United States of America, joined Jun 2000, 5192 posts, RR: 8
Reply 2, posted (9 years 1 month 2 weeks 13 hours ago) and read 5136 times:

So Midwest's signature service would go bye bye? Or would they operate them as a separate entity?


Third Coast born, means I'm Texas raised
User currently offline727LOVER From United States of America, joined Oct 2001, 6456 posts, RR: 20
Reply 3, posted (9 years 1 month 2 weeks 13 hours ago) and read 5089 times:

"They are clearly looking for a window to expand outside of Atlanta," Robert Mann, a Port Washington, N.Y.-based airline consultant, said of AirTran.


DFW anyone?



Listen Betty, don't start up with your 'White Zone' s*** again.
User currently offlineQuickmover From United States of America, joined Mar 2004, 2494 posts, RR: 0
Reply 4, posted (9 years 1 month 2 weeks 13 hours ago) and read 5084 times:

"So Midwest's signature service would go bye bye? Or would they operate them as a separate entity?"

I would think it would go bye bye in favor of a first class cabin and about 30 more total seats. If you check the airfares, YX rarely commands any premium fares for the signature service on competitive routes. Adding the extra seats and business class (for those willing to pay for it) would bring those 717s alot closer to profitability. Lack of signature service hasn't seemed to slow down NW in MKE and they use alot of rjs.


User currently offlineN1120A From United States of America, joined Dec 2003, 26536 posts, RR: 75
Reply 5, posted (9 years 1 month 2 weeks 13 hours ago) and read 5022 times:

Quoting Quickmover (Reply 4):
I would think it would go bye bye in favor of a first class cabin and about 30 more total seats. If you check the airfares, YX rarely commands any premium fares for the signature service on competitive routes. Adding the extra seats and business class (for those willing to pay for it) would bring those 717s alot closer to profitability. Lack of signature service hasn't seemed to slow down NW in MKE and they use alot of rjs.

Would be interesting to see if FL adopted the baked on board cookies, given the low cost. Then again, do they have hot capable galleys?



Mangeons les French fries, mais surtout pratiquons avec fierte le French kiss
User currently offlineQuickmover From United States of America, joined Mar 2004, 2494 posts, RR: 0
Reply 6, posted (9 years 1 month 2 weeks 12 hours ago) and read 4978 times:

Cookies are nice, but I just don't think they sell plane tickets. FL would surely want to keep things common with the rest of their operations. When you check the last round of load factor reports, just about everyone is coming in around 80%. Fares are relatively the same, the cost to operate a 717 is about the same. It seems like a no brainer business wise to be selling 80% of 117 seats rather than 80% of 88 seats. I think in that scenario, the YX jets would turn a profit.

User currently offlineMikey711MN From United States of America, joined Nov 2003, 1398 posts, RR: 8
Reply 7, posted (9 years 1 month 2 weeks 12 hours ago) and read 4992 times:

Quoting 727LOVER (Reply 3):
"They are clearly looking for a window to expand outside of Atlanta," Robert Mann, a Port Washington, N.Y.-based airline consultant, said of AirTran.

DFW anyone?

If this happened a year ago, I'd have agreed with you. But DFW's old DL gates have been available for a long time as has the incentive package for a carrier to set up shop there, so I would think that FL has, at least for now, let that go by the wayside.

As I've expressed in the few FL-YX threads before this one, IMHO the lack of response to DFW's vacancy combined with their enthusiasm for ATA's space at MDW leads me to believe that their expansion plans are a little more north than Texas, at least for a second hub or expanded point-to-point operations. To that end, YX is attractive enough...the fleet commonality (at least as far as the 717s are concerned) is a benefit to be sure, but it isn't the primary one (despite the opinions of a few a.netter's).

What makes such a deal between these two airlines so complicated is what MEH [Midwest Express Holdings] is vis-a-vis just Midwest Airlines. What does FL do with the MD's? the Skyway/Connect operation of 328s and 1900s? the charter operations? ATA didn't have nearly that much "baggage", but YX does, so any merger or buyout will really have to be creative.

So in the spirit of a.net armchair CEO'ing, I would guess that if a deal went through, it would be because FL was able to get the leases for the 717s and gate space at MKE and other YX stations, leaving MEH to fend for themselves on paying for the Connect operation and the MDs (which, IMO, could be configured to their fancy charter layout pending an analysis on adequate demand for such service). I'm not sure if FL would be interested in Connect providing regional services--even in some short term--to feed mainline services in MKE or anywhere else, but the guys at the cookie palace aren't going to let FL walk away with the cow and leave them holding the spoiling milk.

-Mike



I plan on living forever. So far, so good...
User currently offlinePHLBOS From United States of America, joined Mar 2004, 7524 posts, RR: 24
Reply 8, posted (9 years 1 month 2 weeks 12 hours ago) and read 4960 times:

Should a deal with Midwest fail to materialize, another potential AirTran target could include privately held Spirit Airlines Inc. of Miramar, Fla. Spirit has raised $225 million since February 2004 from private equity sources led by Oaktree Capital Management LLC in a move to build its operation across the Caribbean and Latin America, but the airline faces mounting competition as airlines big and small target tourist destinations such as those Spirit serves.

FL merging w/NK? There definitely would be some fleet commonality issues. Would FL inherit NK's proposed terminal expansion at ACY? They'll definitely be going head-to-head w/NW at DTW more so than they're originally planning to be.

AirTran also could make another run at ATA should that company's agreement with Southwest falter, or attempt to purchase gates or other assets at Washington's Dulles International Airport from struggling FlyI Inc. should that company need to restructure.

That would be one way to get some 738s rather quickly. Not that they would keep any of TZ's 752s, 753s, or any remaining charter L-1011s; but it would be interesting to see those planes in FL colors. I know, I know, it ain't going to happen.



"TransEastern! You'll feel like you've never left the ground because we treat you like dirt!" SNL Parady ad circa 1981
User currently offlineQuickmover From United States of America, joined Mar 2004, 2494 posts, RR: 0
Reply 9, posted (9 years 1 month 2 weeks 12 hours ago) and read 4926 times:

"That would be one way to get some 738s rather quickly. Not that they would keep any of TZ's 752s, 753s, or any remaining charter L-1011s; but it would be interesting to see those planes in FL colors. I know, I know, it ain't going to happen."

They were giving up alot of their 753s and 738s in favor of some old UA 735s and 733s I believe. I think they have 8 or so gates left at MDW which would not be as good as the 14 they originally wanted, but could be used for a very nice operation. I just don't know how WN still fits in this mix. ATA is probably obligated for a certain period of time providing code share services for WN. WN also owns a non voting stake in the company. ATA, still operating under ch. 11, would also have to have any FL aquisition approved by a judge. I'm sure WN would want to prevent this from happening, probably by bidding for the company themselves. IMO, MDW would be much better than MKE.

interesting stuff


User currently offlineWjcandee From United States of America, joined Jun 2000, 5196 posts, RR: 22
Reply 10, posted (9 years 1 month 2 weeks 11 hours ago) and read 4804 times:

Personal opinion: These people are idiots. There's no reason for Airtran to buy another company when it has plenty of wherewithal to buy ASSETS from distressed carriers or just buy what it needs new or used from the manufacturer or lessor. There are 717s out there beyond Midwest, if that's really what Airtran wants. Some of these guys, possibly including Midwest, will eventually go under, and Airtran can choose to cherry-pick some of their assets. But to buy an operating entity? Why? It just brings problems that Airtran doesn't need. Much better to expand sanely from within.

And -- hello? -- last I looked Milwaukee was a very different city than Chicago, no matter how "nearby" it is.


User currently offline7E72004 From United States of America, joined Mar 2004, 3587 posts, RR: 2
Reply 11, posted (9 years 1 month 2 weeks 11 hours ago) and read 4789 times:

Maybe FL should start GYY service  bigthumbsup 


The next generation of aircraft is just around the corner!
User currently offlineMaverickM11 From United States of America, joined Apr 2000, 17544 posts, RR: 46
Reply 12, posted (9 years 1 month 2 weeks 11 hours ago) and read 4743 times:

Quoting Drerx7 (Reply 2):
So Midwest's signature service would go bye bye?

Signature service is simply not viable these days; it might potentially be viable in ATL to select business markets, but MKE forget about it. I really believe its days are numbered, regardless of whether AirTran becomes involved with Midwest.

Quoting 727LOVER (Reply 3):
DFW anyone?

DFW has been a major disappointment for FL. I don't see much further expansion there for FL, especially if the Wright Amendment goes away.



E pur si muove -Galileo
User currently offlineKC135TopBoom From United States of America, joined Jan 2005, 12150 posts, RR: 51
Reply 13, posted (9 years 1 month 2 weeks 11 hours ago) and read 4709 times:

Quoting Mikey711MN (Reply 7):
If this happened a year ago, I'd have agreed with you. But DFW's old DL gates have been available for a long time as has the incentive package for a carrier to set up shop there, so I would think that FL has, at least for now, let that go by the wayside.

As has any other airline. You don't see anyone lineing up to beat down DFW's doors to get 22 gates and $22M, do you?  scared 

You have to ask yourself, why is that?  listen 

Because as part of the deal, at least 70% of the seats you fly from DFW have to fly to other airports already served by a DFW carrier.

Now, since AA has 83% of the service from DFW, who do you think you have to compete against?  scratchchin 


User currently offlineQuickmover From United States of America, joined Mar 2004, 2494 posts, RR: 0
Reply 14, posted (9 years 1 month 2 weeks 11 hours ago) and read 4708 times:

"Signature service is simply not viable these days; it might potentially be viable in ATL to select business markets, but MKE forget about it. I really believe its days are numbered, regardless of whether AirTran becomes involved with Midwest."

You're right. Adding a business class is the smart move, that way if you want the type of amenities that signature service offers, you pay for it. I would bet that most passengers just want to get from point a to point b on time in coach. At least this way, you're not obligating your entire aircraft to first class specs and charging coach fares. Plus you can reward loyal customers with upgrades and burn up FF miles another way. Much better revenue model for airlines.


User currently offlineTornado82 From , joined Dec 1969, posts, RR:
Reply 15, posted (9 years 1 month 2 weeks 11 hours ago) and read 4683 times:

Quoting 7E72004 (Reply 11):
Maybe FL should start GYY service

Naahhh, VPZ, it has less of a negative connotation than GYY.  Wink


User currently offlineRamerinianAir From United States of America, joined Nov 2003, 1486 posts, RR: 0
Reply 16, posted (9 years 1 month 2 weeks 11 hours ago) and read 4664 times:

I think they should invest their $$$ in purchasing their A/C. Most of the 717s are now leased. A lot of the DC-9s and MD-80s were owned outright. If they put this money into their A/C, it would help their bottom line. Also, they could reconsolidate their debt and put the money towards their debt to help file down financing costs- this also would go to help their bottome line. Both of these options will put them in a better position to battle higher fuel costs and DL.
Steve



W N = my Worst Nightmare!!!!!
User currently offlineSrbmod From , joined Dec 1969, posts, RR:
Reply 17, posted (9 years 1 month 2 weeks 9 hours ago) and read 4525 times:

Alright, which one of our members wrote this article?????

As Travatl has hinted to in a few threads, YX is not the possible merger target; an airline a little further west supposedly is.

Perhaps YX could be bought on the cheap leaving room for a second merger involving a western US based airline.....


User currently offlineCIDflyer From United States of America, joined Apr 2005, 2313 posts, RR: 3
Reply 18, posted (9 years 1 month 2 weeks 9 hours ago) and read 4506 times:

Quoting Srbmod (Reply 17):
YX is not the possible merger target; an airline a little further west supposedly is.

Who would that be? Frontier? Alaska?


User currently offlineMariner From New Zealand, joined Nov 2001, 25328 posts, RR: 85
Reply 19, posted (9 years 1 month 2 weeks 9 hours ago) and read 4465 times:
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Quoting CIDflyer (Reply 18):
Who would that be? Frontier? Alaska?

From the other thread about this:

RE: Airtran Raising $225 Mil. (by Mariner Aug 17 2005 in Civil Aviation)

$225 million wouldn't even get you in the door at Alaska. They have nearly $1 billion in the bank, their market cap is just under $1 billion, and any investor would expect a 50% premium.

To merge with Frontier would not be cheap, either. The market cap is up there at around $400 million, and, again, there would need to be about a 50% premium.

Quoting Quickmover (Reply 25):
code share: Frontier better route structure.

Airtran and Frontier discussed a code share a couple of years ago. It didn't happen because the computer systems were incompatible.

Since then, Frontier has changed to Sabre. i don't know what Airtran uses.

Quoting Quickmover (Reply 25):
They would be a great merger partner if they didn't have all of those planes that start with the letter "A".

Well, thank goodness they do. A code share might be good, but I don't want to see 'em merge with Airtran.

I'd miss the critters.


 Smile

cheers

mariner



aeternum nauta
User currently offlineQuickmover From United States of America, joined Mar 2004, 2494 posts, RR: 0
Reply 20, posted (9 years 1 month 2 weeks 9 hours ago) and read 4442 times:

Frontier would be the perfect merger for Airtran, but two things will probably stop it.
1) Boeing vs Airbus
2) Business class vs single class seating.

I just don't think it will happen.


User currently offlineMariner From New Zealand, joined Nov 2001, 25328 posts, RR: 85
Reply 21, posted (9 years 1 month 2 weeks 9 hours ago) and read 4399 times:
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Quoting Quickmover (Reply 20):
1) Boeing vs Airbus

And this is different from jetBlue's Airbus and Embraer how?

Quoting Quickmover (Reply 20):
2) Business class vs single class seating.

if the airlines merged, as opposed to code share, this could be changed.

However:

Quoting Quickmover (Reply 20):
I just don't think it will happen.

I agree. But for a different reason. The price tag on Frontier would be about $600 million.

cheers

mariner



aeternum nauta
User currently offlineFlashmeister From United States of America, joined Apr 2000, 2900 posts, RR: 6
Reply 22, posted (9 years 1 month 2 weeks 8 hours ago) and read 4333 times:
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The price tag on Frontier would be about $600 million.
At least. I think, given Frontier's position in a hub that UA is steadily retreating from, plus their extremely impressive RASM performance (up double-digits year over year), they'd likely command more than a 50% premium.

And, I think there could be a battle for Frontier if it suddenly went into play. jetBlue + Frontier has been discussed ad nauseum, but I think that if Neeleman and Soros saw their scrappy Southern competitor poised to grow bigtime, they'd jump in the fight. A battle drives the price up.

I'd be very surprised -- and even more skeptical -- if AirTran and Frontier sealed a deal. Frontier knows that they don't have to merge to stay afloat. Midwest doesn't have the same luxury.


User currently offlineAirTran737 From United States of America, joined Apr 2004, 3704 posts, RR: 12
Reply 23, posted (9 years 1 month 2 weeks 8 hours ago) and read 4323 times:
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I waited a while to weigh in on this one. It has been a rumor for years that FL and YX were going to get together. As a MKE based employee I can say that the rumors are more rampant now than they have ever been in the past. YX and FL make perfect sense, the only issue would be seniority, which I will break down in my opinion of how it would pan out.

Pilots-
Midwest is represented by A.L.P.A., AirTran by N.P.A.
Midwest pilots will lose out on this one. As small as the N.P.A. is, with FL being the aggressor, the pilots will either have to go to the bottom of the list, or be given prefered interviews.

Flight Attendants-
Both companies are represented by the A.F.A.
The advantage on this one will go to Midwest. A.F.A. always merges their lists, and being that YX is about 10 years older than FL any senior YX F/A's could win big on this one. Unless FL keeps the hubs separate from one another I see no way for the FL F/A's to win.

Mechanics-
AirTran is represented by the Teamsters, Midwest is non-union.
Midwest loses big time on this one, no ifs ands or buts.

Dispatchers-
AirTran is represented by the T.W.U. (correct me if I am wrong) YX is non union.
Midwest loses again.

Customer Service/Ramp
Both carriers are non-union. When the TZ deal almost happened we were told that any acquired employees would go to the bottom, and as the aggressive carrier in this potential deal I see no reason to believe otherwise.

Midwest Connect-
Skyway is a great little airline, their maintenance program is one to be envied, and those B1900's and 328Jets have kept YX afloat for a while. I don't know what would happen to them. I would hope that they would stay on, but I can't be too sure.

This deal could be great for both companies. For AirTran it gives them a Midwestern hub, and for YX it lets the employees keep their jobs. It maybe another airline, but they will still get a paycheck. FL wants another hub. After being scorned in the TZ deal by WN they have become more aggressive. MKE is only an hour and a half from downtown Chicago. The Milwaukee metro area has a population of well over a million people, and on top of that you would still be able to tap into Northern Illinois. This could be a great merger, fleet commonality will help ,and the fact that the aircraft are both financed through Boeing Capital is a plus for FL. I would love to see this go through. I await the "no way in Hell" response from 917ME and SideFlare.



Nice Trip Report!!! Great Pics, thanks for posting!!!! B747Forever
User currently offlineSideflare75 From United States of America, joined May 2005, 613 posts, RR: 1
Reply 24, posted (9 years 1 month 2 weeks 7 hours ago) and read 4214 times:

AirTran,

You say that only the FA's will come out ahead on this merger deal but then say that YX's employees get to keep their jobs. It can't be both.

I never said this would not happen, I just said the reasons that are giving are not enough to convince me. 717's are the only reason that even remotely makes sense, and I still say that if AirTran wanted more they could have just ordered them when they had the chance. Why go throught the mess of a merger for that?

So there's your "no way in hell" response that you wanted. I'm am trying to look at this logically and not because I work for YX. Give me some solid reasons that this should take place and try to convince me. All I hear are the same old reasons that have been around for years. Sorry but I'm not convinced.


25 PHLBOS : Neither FL nor YX fly any DC-9s anymore. They were retired within the last year or two.
26 JBo : If FL and YX were to merge, either the money would be there to expand the regional network. [with a more nationwide presence, the combined airline mi
27 Srbmod : Navitaire's Open Skies system. FL has been using it for years.
28 Indy : For an airline that is supposedly so interested in YX and MKE they haven't been beating down the door to add routes there. Could it be that there is s
29 Quickmover : quoting mariner "And this is different from jetBlue's Airbus and Embraer how?" I have not seen one JetBlue Embraer in revenue service yet. Granted Nee
30 Midway2AirTran : It is pretty obvious (now to most anyone) that AirTran is highly interested in the Chicago market, but IMO it will be happening in Chicago and not MKE
31 Indy : Where would they go in Chicago? MDW and ORD are full. They might want Chicago but odds are it isn't going to happen.
32 Post contains images Mariner : Yes, it has. A lot of things have worked for WN. A single class has worked for WN. The concept of "no hub" has worked for WN (helloooo, ATL and MKE).
33 Indy : Of course that brings up the debate whether you call MDW or BWI a hub for WN. If you look at the number of routes connecting in those airports you'd
34 Post contains images Mariner : Yes, I would call them both hubs. I would say that WN has several hubs. But the mantra is that WN does not have hubs and does point to point flying.
35 LawnDart : The A320 and the E190 serve different market segments...the potential fleet of 737/A319/A318/717 are much more closely spaced in capacity and capabil
36 ChiGB1973 : HEHE, when? At 2am? I live just north of downtown and it takes me 30 minutes to get to O'Hare. This is when I report to work at 5am. Granted, the tra
37 Mariner : I understand that. But Quickmover is using the WN model and arguing against any two type fleet. It is a completely valid point of view. I don't think
38 Quickmover : "But Quickmover is using the WN model and arguing against any two type fleet" I could also use the Frontier model, but there are not too many combinat
39 Quickmover : Although you really couldn't call YX a LCC.
40 DAYflyer : They would get my vote over the pretzles, thats for sure. Who else could they buy in Chicago? There is no one available for sale.
41 Mariner : Well - not quite. Yes, Frontier mainline is all A320 family. But Frontier is also one of the few LCC's (HP the other) that has a contracted Express c
42 Post contains images Tornado82 : Want to know where the WN hubs are, just look at where they began PIT service to. I'm still surprised we didn't get service to the BWI pseudo-hub, fo
43 Midway2airtran : Anything is available at a price. Considering that AirTran backed out increasing its low-end bid for ATA's assets and still continues to hold stance
44 BH : Maybe they are planning on NWA falling apart, who knows? New service to DTW and a possibility of expanding in MKE maybe the are just trying to positi
45 FutureFO : What everyone is seeming to forget that the rumours have been around for years. There will be no merger between YX and FL. That has been emphatically
46 Srbmod : If it's been a disappointment, why did they go from 2 DFW-LAS/LAS-DFW and 2 DFW-LAX/LAX-DFW to 3 dailies back in June? The loads are there for the fl
47 N917ME : Actually the MKE hub is great for YX. YX carries more than 50% of all MKE traffic, NW market share in MKE has steadily declined. I do not see YX and
48 Post contains images Midway2AirTran : Is that 50% of flights or passenger traffic? It would be great if YX could make a profit with that to help the rumor hit the fan finally! If B717 car
49 Post contains images Sllevin : Not that I'm saying it'll happen, but just to clarify, money in the bank, if anything, makes a takeover target MORE desireable. Cash on hand can then
50 Mariner : I'd be surprised. We did the math at the time of the rumors that Alaska was going to buy Frontier, a couple of summers ago. Alaska's share price is v
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