CALPSAFltSkeds From United States of America, joined Dec 2006, 2201 posts, RR: 8 Posted (6 years 5 months 3 days 22 hours ago) and read 6950 times:
Well, here I go with my first post after reading for a couple of years.
It appears to me that a combination of UA and CO can initiate growth that CO would like to accomplish internationally with current UA equipment while improving UA's efficiency and stage length.
1.) There would be numerous aircraft released from duplicated service on several routes, including EWR-ORD/DEN/LAX/SFO, IAH-ORD mainline plus RJ's on EWR-IAD and ORD-CLE. With combined schedules, some hub to hub flying would see reduced connection traffic as non-stops bypassing hubs could now be sold on the "other" airline's network. This may equal 10-20 aircraft which could be redeployed to free 752 or larger aircraft.
2.) The UA premium service between NYC-LAX/SFO can be converted to newer, just slightly smaller 738 or 739ER equipment, releasing about 12 757 aircraft for European and Latin American services. With the better economics of 738/739ER aircraft, PS expansion may be profitable. I believe further study would show whether the service should be from JFK or EWR, but should be based upon delays, travel to Manhattan and connection opportunities. Note that CO has 60 737NG's on order and have confirmed 24 of these to be 739ER aircraft.
3.) UA offers 777 and 763 service domestically on several major routes. ORD-/DEN/LAX/SFO, DEN-LAS/SFO/IAD, SFO-IAD. While some of this service may be necessary, it uses aircraft that could be used for Eastern Europe (or beyond) flying.
4.) UA 757 aircraft are assigned on numerous domestic routes from ORD, DEN, LAX and SFO. Some of these flights can be swapped out to offer additional aircraft for Europe and Latin American flying.
5.) I believe a combination of the two carriers should not include a full merger at this time. The contolling party (CO management, please) can coordinate schedules and pricing. Future equipment retirement and orders would move the two airlines toward commonality and an eventual merger at some point. Replacing the UA livery (old one or new one that looks like the aircraft is on a ski charter) and corporate drab grey with the CO globe livery would ensure the public of the new "mergered" partnership.
6.) Relocating gates, ticketing and combined computer operations would alllow efficiencies at individual airports. The trick would be to somehow integrate operations without a full merger. I suggest the the merged company (airline), would employ all staff except flight staff, could operate the equivalent of three wet lease airlines, UA, CO, and TED. The impact on ground staff employees and potential of folding Ted into UA or CO needs extensive analysis.
7.) The object of this merger would be the ablity to serve virtually all O&D markets in the US plus be a major international player to most continents. With major hubs at EWR, ORD, IAH, IAD, DEN, SFO and hubs at LAX, CLE, GUM and NRT plus expanded international service to Eurpope, Asia, Latin/South America and the South Pacific, it appears to me that a UA/CO combination would have it almost all covered. Of course, whatever milage plan is used needs to be combined and service coverage could create loyalty from everyone except those who reside in another airlines hub city (DFW, ATL, SLC, MIA, PHL, CLT, PHX plus WN's LLC attraction). With such coverage, I question if an alliance which includes another US carriers would be wise. Could US be dumped from the Star Alliance? Surely, the international alliance in Europe would be less important as numerous new destinations can be added from EWR, IAD and ORD.
8.) International flying should be the focus of new service of the combined carrier. CO's 41 752 aircraft, with International BF legroom, should be assigned to Europe from EWR and possibly IAD. UA's 752's could cover heavy domestic routes, Latin America and maybe serve Ireland and England, but I understand they have a limited ETOPS fleet that may be covering Hawaii. A few UA 763 and 772nonER aircraft could serve European destinations from EWR/ORD/IAD. Additions should include 757's to secondary French cities, HEL, 763 service destinations beyond 752 range (PRG, VIE, WAW, and consider every other international destination now served from JFK). IAH could get service to oil markets in England/Scotland and expanded South American service. 763 aircraft could release 762 aircraft for thinner routes mentioned above. According to Airfleets.net UA still has 3 744 aircraft at Victorville, many newer than those flying in their fleet today. 744 aircraft could operate EWR-LHR/CDG to free more overseas aircraft for expansion.
Tommy767 From United States of America, joined Aug 2003, 6171 posts, RR: 9 Reply 1, posted (6 years 5 months 3 days 22 hours ago) and read 6909 times:
Well I can tell you that if this actually happens, Satellite A-1 at EWR would free up (currently UA.) And the combined result would be Terminal C. I guess that CO would want to keep there A-2 gates, but you never know. Especially if IAD would become a domestic workhouse for the airline.
"Folks that's the news and I'm outta here!" -- Dennis Miller
AA737-823 From United States of America, joined Mar 2000, 5334 posts, RR: 11 Reply 3, posted (6 years 5 months 3 days 17 hours ago) and read 6541 times:
Disagree with point #3.
All such flights are repositioning flights for the aircraft to be at necessary airports for international hops. The NRT-LAX 744 might need to do a ORD-CDG run next, for example, so it hops LAX-ORD meanwhile and makes some more revenue.
That's just an example.
Otherwise, your propositions sound reasonable enough, but dang it, I want Conti to stay Conti, keep the management, and the name! A new livery would be nice though... the current one is too... dull. Bring back the golden tail in some way. Okay, that's off topic.
I don't think point #2 would work out. I think that, having just shoved a reconfig'd 752 down the throats of transcon pax accustomed to 762 flying, a further drop to a 738 (737-924ER isn't due till 2008) would be a PR and OnePass/Mileage Plus Elite catastrophe.
In response to point number 6, Continental will never do an airline-within-an-airline operation like Ted. They tried once, failed miserably, and won't make that mistake again. It's not really Conti's business model to offer a cheap product, anyhow. They advertise by service level, and where yields are too low, they put the incredibly low-cost aircraft on the routes: the 757-300.
I don't see all the hubs you name in point seven remaining operational. EWR and IAD? I don't know, those two are awfully close for what they are- TransAtlantic and east coast hubs. Continental DEFINITELY needs DEN and something in Cali though.
Point 8 is well thought out.
Thanks for your thoughts on this, good topic. I hope it doesn't come to this, I think, but we'll see. I'd like both names to stick around as successful stand alone carriers!
Boston92 From United States of America, joined Aug 2006, 3390 posts, RR: 7 Reply 4, posted (6 years 5 months 3 days 17 hours ago) and read 6517 times:
Quoting AA737-823 (Reply 3): Disagree with point #3.
All such flights are repositioning flights for the aircraft to be at necessary airports for international hops. The NRT-LAX 744 might need to do a ORD-CDG run next, for example, so it hops LAX-ORD meanwhile and makes some more revenue.
That's just an example.
Otherwise, your propositions sound reasonable enough
I will save me the time to rewrite what you wrote and just put a:
"Why does a slight tax increase cost you $200 and a substantial tax cut save you 30 cents?"
Drerx7 From United States of America, joined Jun 2000, 4905 posts, RR: 9 Reply 5, posted (6 years 5 months 3 days 16 hours ago) and read 6419 times:
If both IAD and EWR make money I could see them sticking around-- Worst case on the east coast - I'd see IAD downgraded to a focus op with key international routes. If CLE stays it'll probably be similar to what STL is to AA.
FlyHoss From United States of America, joined Feb 2005, 598 posts, RR: 0 Reply 12, posted (6 years 5 months 3 days 15 hours ago) and read 6214 times:
First, I'd expect some reductions of flights on routes that are currently served by both carriers. It's unfortunate, but there would be job losses. A year after the merger, the fleet would be considerably smaller than the two seperate fleets are today.
BAW716 From United States of America, joined Nov 2003, 1994 posts, RR: 31 Reply 14, posted (6 years 5 months 3 days 14 hours ago) and read 6143 times:
First, welcome to the active a.net community. Second, I hope you have really good kevlar You may need it. (Just kidding).
You've said a lot in your first post...it's taken me a while to get through it and since I'm known for being somewhat long winded, I am going to be as brief as I can.
First, I agree wholeheartedly with point 5) that the combination should not involve a full merger at the present time. I believe they should operate as separate entities for the time being and combine those functions which will bring efficiencies to the total entity a la the AF/KL merger.
There are some redundancies in what you have said in some of your points. To take your post and reduce it to a theme...the complexities involved in rationalizing the fleets, let alone everything else make point 5) even more an absolute necessity.
I think your post really brings into clear relief the complexities of bringing these two carriers together into one operating entity. Clearly, there will have to be fleet rationalization...the first thing to go will be the Airbuses. Commonality will dictate an all Boeing fleet...which is sad, because I really like the A319/A320 from the perspective of the passenger. Also, the aircraft are extremely efficient and are a real winner for UA. The problem is that to have the A319/A320 in the middle of a mix of Boeing variants is just going to be a nightmare to bring together within one maintenance organization (in my opinion).
The route/fleet combinations you have stated really need to be studied and frankly, I don't know that I agree with your points about placing more 757s on Europe. Continental has a problem with that aircraft right now...in that passengers HATE it...to Europe. In BF, it is barely acceptable, in Economy, it is absolute hell. 17 x 31 in pitch, single aisle, no PTV and a 7-8 hour stage on most segments...people will put up with it on 6+ hour flights, but get over seven hours and that aircraft is just horrid in its current configuration. If the pitch were increased to 32 inches and PTVs put in Y class...then it might make better sense.
The key is to get the right yield mix in Y class to make the bird profitable across the water and fill BF. IF CO goes with a flat bed BF product a la UAs F class on the PS product, then I think it will really be attractive and then would fill the cabin with enough high yield revenue to offset the reduction in the number of seats necessary to make the product viable in Y. I think if you look at passenger traffic, CO passengers will go east on the 757, and come west another way...via LGW on the larger aircraft.
But this is one market area and one aircraft...there is so much more...and getting the right mix of product between UA and CO in each market area. This is a very complex issue and one that I don't have an answer for without significant analysis on how well the two frequent flyer programs can be harmonized.
In my opinion, once a merger is consummated, this is the first step: Harmonizing the frequent flyer programs. Once this is accomplished, then it will not matter what metal a traveler flies on, the credit and reward will be equal. With different premium products, this means making changes to the accrual AND reward structures. If they do this first and make things equal between the two programs, then CO fliers will have an incentive to fly UA and vice versa.
The other major issue out of the gate is what alliance? No matter what happens, it is going to cost someone a bundle of money to get out of one of the alliances in penalties....and this will have to be brought into the equation at the front of the discussion even before the merger is done.
There is no doubt that the combined routes will make UA/CO the biggest US carrier. It will also make it the carrier with the largest network reach...far beyond any other carrier. Of course, this brings about another possibility...that this carrier exits all alliances and operates on its own, with alliance agreements with feeders at certain international points. This very point could force a fundamental shift in alliances as we see them today.
These questions are so complex...that it is difficult to approach them all in one post. That said, your post raises some interesting questions; however, I think your answers may not be completely on the mark. Please don't take this as a reflection of your ideas; it is a reflection of the complexity of the issues that will face this combined entity.
If they can get the alliance issues sorted out and get to a deal, then hold on to your hats....this will be one heck of a ride.
David L. Lamb, fmr Area Mgr Alitalia SFO 1998-2002, fmr Regional Analyst SFO-UAL 1992-1998
CALPSAFltSkeds From United States of America, joined Dec 2006, 2201 posts, RR: 8 Reply 15, posted (6 years 5 months 3 days 14 hours ago) and read 6124 times:
Regarding 744 service, it would probably make sense to keep the aircraft type on Pacific service. With 3 parked at Victorville, maybe EWR-NRT (taking 2 aircraft for a single round trip) is all that could be added, but might create a maintenance problem if checks were to be completed at EWR. Hopefully swaps could be made at NRT for maintenance.
It would be foolish to reduce at IAD as shifting flights to EWR would be problematic. EWR runway configuration can get pretty congested and if numerous new European flights were added, where do you park the aircraft? Long turns would be a norm on international operations and take up numerous gates in the noon-8pm time frame.
CO should use EWR and IAD as twin hubs to move people internationally and match up East Coast connections. As such, service could be reduced on some EWR short haul markets to allow for additional long haul operations. Some smaller domestic markets could overfly EWR to feed IAD on large European (and domestic) markets while larger domestic markets could feed EWR for smaller European markets. They could probably stand to lose small to small markets for the sake of operational integrity at EWR.
I'm not sure that switching out 738 or 739ER for 752 PS would be the problem. They have the same tube and the 738/739ER aircraft are brand new with I would assume more modern interiors and overheads. With better economics, frequency could be added, which could compensate for any grumbling. The largest concern would be the potential of westbound fuel stops. The conversion should not take place right away as expansion to Europe couldn't absorb 12 more 752's right away. Wait for the 739ER and see if minimal aux. fuel tanks are needed for a subfleet.
Don't get me wrong, I used to work for CO when it was the Proud Bird with the Golden tail and remember when riding CO was as envied as getting a Coors beer east of Colorado. I've was through the Lorenzo days before leaving and my wife's been through bankruptcy. After some tough times, CO progress has made it the better brand than UA. Any merger or acquisition would have problems with integration of employee groups. That being said, the industry may require a merger to survive and CO/UA route structure would be the best fit. It's the job of good management to be ahead of the game and plan to stay competitive.
CALPSAFltSkeds From United States of America, joined Dec 2006, 2201 posts, RR: 8 Reply 16, posted (6 years 5 months 3 days 14 hours ago) and read 6033 times:
I take no offense and agree with the majority of what you have to say. This is a complex issue. My expertise is in flight scheduling and agree that major steps would be the mileage program and alliance issue. My first post talked about the alliance issue and discussed whether any other domestic carrier should be in the UA/CO program. I think not. The merger carrier could develop it's own alliance as added European services could eliminate the need for some carriers.
As far as CO's 752 product, I agree that utilizing all 41 on mostly second tier European markets requires upgrades. PTV's, power ports and maybe more pitch in economy. The maketing guys and bean counters would need to decide on lay flat First Class seats, but whatever decision is made must be carried across the entire fleet or at least service by sector (Europe may have a different First product level than Asia).
My thought on fleet commonality was to keep the carriers maintenance separate for a period (number of years), which would allow the continued use of 320 and 319 aircraft. Unless Boeing offers a killer deal to buy back Airbus aircraft, they could be retied later as new aircraft (common to both carriers) are put into service. Same thing with 744 aircraft. While a Boeing killer deal could be seen as positive, it would also require additional training, which may not be a great idea early on in this potential venture.
KstateinALB From United States of America, joined Dec 2006, 732 posts, RR: 0 Reply 17, posted (6 years 5 months 3 days 14 hours ago) and read 6028 times:
Quoting Drerx7 (Reply 2): You'd probably see 744s come onto some of COs flagship routes
I agree. It would be great to see them in CO livery, but thats not as important. I was thinking that keeping them on the Pacific routes would be smarter because the aircraft and crews are acclimated to the airports, etc.. Probably not important either, but my 2 cents there.
Quoting FlyHoss (Reply 12): the fleet would be considerably smaller than the two seperate fleets are today.
Im wondering what they would take out. The 733's from UA probably. Would the Airbus narrowbodies be taken out? No idea... its a very complex situation with reagrds to that.
Drerx7 From United States of America, joined Jun 2000, 4905 posts, RR: 9 Reply 21, posted (6 years 5 months 3 days 11 hours ago) and read 5784 times:
Of note about the 757s--they are getting PTVs (AVOD) in Y starting in March or May of 2007. Seeing more widebodies at IAH is about the only positive I can get out of this merger--while I like United, I have to root for the hometown team.
UA772IAD From Australia, joined Jul 2004, 1635 posts, RR: 3 Reply 22, posted (6 years 5 months 3 days 10 hours ago) and read 5709 times:
Quoting CALPSAFltSkeds (Thread starter): 2.) The UA premium service between NYC-LAX/SFO can be converted to newer, just slightly smaller 738 or 739ER equipment, releasing about 12 757 aircraft for European and Latin American services
Quoting CALPSAFltSkeds (Thread starter): 4.) UA 757 aircraft are assigned on numerous domestic routes from ORD, DEN, LAX and SFO. Some of these flights can be swapped out to offer additional aircraft for Europe and Latin American flying.
Quoting Supa7E7 (Reply 9): One new thing would be IAD-Europe 757 flights.
UA's 757s will not fly to Europe, ever. United's B757 fleet does not have the capability to serve most European destinations without assuming significant passenger and payload weight restrictions. Unlike Continental's and American's B757 aircraft, United's B757s have lower thrust engines and lower max takeoff weights. Since these missions would be flying from a slightly more southern starting point (IAD), limit the number of passengers and the amount of cargo that could be carried. This in turn would dramatically reduce revenue.
UA only has 16 ETOPs configured 757s which are dedicated to Hawaii and other ETOPS set-up missions. Since ETOPS aircraft would be required to fly to Europe , the cost of converting standard B757 to ETOPS planes would outweigh any savings to be had from using the B757 equipment.
In addition, while p.s. aircraft are optimally suited for premium transcon markets that have a lot of premium demand, the aircraft's seating configuration make them poorly suited for most Trans-Atlantic missions. At United and across the industry, there is a trend toward greater economy-class demand and less premium-class demand to Europe . Based on the current economic environment, there is an advantage to having more economy-class seats on our aircraft to Europe . The p.s. aircraft do not offer that additional capacity.
777gk From United States of America, joined Jun 2000, 1641 posts, RR: 20 Reply 23, posted (6 years 5 months 3 days 10 hours ago) and read 5676 times:
The real problems we are encountering on the 757s are not related to seat pitch or passenger space at all.
The biggest issues we have been having are maxing out the lav tanks (At times barely 5 hours into an 8hr westbound crossing) and fuel concerns on the longer legs under certain conditions.
These are all problems we have been working hard to solve since the inception of more widespread (i.e. beyond the British Isles) 757 transatlantic service in '05.
Customers do not seem to care on most of the flights about the equipment, in general they are thrilled to have the convenience of 'hometown' nonstop service to the United States. We do fill up our BF cabin on a lot of the flights, which is the primary revenue driver on these operations, and the product is very competitive, indicative of the premium we charge for it in many markets. I will agree that this is not the case in markets like EWR-LGW or CDG, but we do have 777 service available as an alternative for airliner freaks who are completely incapable of sitting in a narrowbody for more than four hours at a time. For the travelers concerned most with time and convenience, our schedule is tough to beat, 757s and all.
We are addressing some of the negatives of our 757 product, as noted. AVOD in all classes starting 2Q07, iPod connectivity, powerports, improved seat designs, and some other cool new amenities on the way. We can't make it perfect, but we can make it better.
Regarding the CO/UA deal and the topic of this thread, I will refrain from comment since it (hopefully) won't be affecting me or my retirement directly, but the route map synergies are very intriguing. As for the rest of the show? Well, I've been through mergers in my day, and let me tell you, no matter what, it's always ONE BIG MESS!
Glad I'm gettin' out before the big one! Here's hoping it does not...
UA772IAD From Australia, joined Jul 2004, 1635 posts, RR: 3 Reply 24, posted (6 years 5 months 3 days 10 hours ago) and read 5608 times:
Quoting AA737-823 (Reply 3): EWR and IAD? I don't know, those two are awfully close for what they are- TransAtlantic and east coast hubs.
Quoting Drerx7 (Reply 5): If both IAD and EWR make money I could see them sticking around-- Worst case on the east coast - I'd see IAD downgraded to a focus op with key international routes. If CLE stays it'll probably be similar to what STL is to AA.
The new airline would be stupid to let IAD become a casualty of the merger. No doubt, NYC area is a very important asset, but so is DC. CO/UA would loose a huge customer base that UA draws from all 3 airports (as well as West VA) and down near Richmond, many of these customers are high status frequent flyers. The political ramifications of closing the DC hub would also be grave. It is not uncommon to see "*Congress* or *Senate* on a UA passenger manifest. Lobbying for new rights to fly to lucritive international destinations, such as China, would also become more difficult. Not to mention, DC is one of (if not THE) fastest growing Metropolitan areas in the US.
I doubt that UA/CO would stand by and loose Washington to AA.
Quoting 777gk (Reply 23): Customers do not seem to care on most of the flights about the equipment, in general they are thrilled to have the convenience of 'hometown' nonstop service to the United States
I've never been on a CO 757, but both passengers and crew (at UA) HATE our 757s.
BTW, I mentioned this in another topic:
Quoting UA772IAD (Reply 95): I recently read an article in the Washington Times, which focused on the UA/CO potential merger, but has an interesting sidenote about NW. The article reports that a potential merger between CO and UA faces a potential obstacle in the form of an unsual relationship between CO and NW. It holds a special preferred "golden share" of CO stock giving NW the right to block CO from consolidating with any other airline.
[Edited 2006-12-19 07:31:59]
25 Supa7E7: Great. When you have time, take a look at the title of this thread. We are talking about a CO/UA _merger_ that would allow some of CO's large fleet o
26 UA772IAD: Great. If you take the time to actually read my post, I addressed why UA's 757s cannot fly to Europe. My point was, UA's 757s would be restricted to
27 PavlovsDog: One thing nobody has mentioned is the opportunity for the merged carrier to possibly start a focus operation at MIA where Star has sufficient gates to
28 OB1504: The thread-starter addressed this by stating that "some of this flying may be necessary". Although it would be nice to see the return of the UA focus
29 PavlovsDog: OB1504: You're forgetting DEN. I agree that MIA would not be an initial action but more something for the 5-10 year time perspective.
30 Jfk777: CO/UA would make a great poker game for fleet re-alignment. The CO 777 fleet could fly some Asian routes served only by UA 744's and 744 could fly fro
31 2travel2know: CO still owns a % of CM, if CO and UA merge, this means CM will be an added bonus to the new mega airline. Although the idea of a UA/CO hub in South
32 UnitedNRT: United PW2040 B757-222 are certified to 256,000 MTOW and there are quite a few of them rotating throughout the system, albeit without ETOPS180 certif
33 Gigneil: I'll just toss in my pennies to support the poster in reply 32. United has more than a few PW2040 powered frames that are certificated for the max MT
34 Ourboeing: Someone please suggest: IAD - DEL (non-stop) That would be a dream come true. Happy Holidays to everyone here!! OURBOEING
35 UA772IAD: Yes, I know. There are 16 of them. However, they are utilized for Hawaii service. Now, with the new airline-perhaps these A/C would become available