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Why Is Nobody Trying To Merge With AS?  
User currently offlineDLPhoenix From United States of America, joined Aug 2007, 416 posts, RR: 0
Posted (6 years 7 months 6 days 7 hours ago) and read 10679 times:

With all the M&A discussions going on why is nobody targeting AS?
AS is the perfect candidate for either CO or DL:
- Strong domestic presence in the northwest.
- A Hub in an airport that can be the perfect gateway to Asia (SEA).
- Small Overlap (With Delta's SLC operations) or no overlap (With CO).

For Delta, this will be a chance to reopen the Pacific gateway they closed in 2001, but this time from a city with larger (and growing) premium O&D traffic and with an established domestic network to support it.

So why is nobody pushing for it  Confused
My  twocents  : Such a merger will not generate the Buzz required for the "Merger Community" to make a quick profit in the stock market.

DLP

65 replies: All unread, showing first 25:
 
User currently offlineJetjack74 From United States of America, joined Jul 2003, 7408 posts, RR: 50
Reply 1, posted (6 years 7 months 6 days 7 hours ago) and read 10666 times:
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I think there will be soon, as the bigger carriers merge, they will eventually focus on the smaller ones. I think AA or a merged NW/DL should consider AS as a potential target. It would stregthen there position in the west.


Made from jets!
User currently offlineHPRamper From United States of America, joined May 2005, 4057 posts, RR: 8
Reply 2, posted (6 years 7 months 6 days 7 hours ago) and read 10651 times:

It's not that nobody wants to, or has wanted to in the past. AS has a lot of financial clout and has not expressed any desire to merge, and they have too much money to simply be bought out as opposed to a merger. Obviously, they would seem to be a good fit especially for AA or CO, and maybe NW.

User currently offlineCommavia From United States of America, joined Apr 2005, 11559 posts, RR: 61
Reply 3, posted (6 years 7 months 6 days 7 hours ago) and read 10614 times:



Quoting DLPhoenix (Thread starter):
With all the M&A discussions going on why is nobody targeting AS?

One major reason: cost.

Alaska is an incredibly specialized airline in the U.S. these days, in a way that few airlines have been in decades. There used to be many airlines like Alaska - airlines that were specially designed (operationally, financially, and otherwise) to operate perfectly in specific environments or geographic regions. Alaska's cost base is significantly lower than any of the legacy majors who would potentially be acquiring it - by a lot. That means that Alaska is a forbidden fruit - it would be a difficult take-over target because any airline that bought the airline would instantly make 1/2 of its routes unprofitably by elevating its costs to the merged airline's levels.

That's why no U.S. carrier today (AA most specifically) could make an AS merger work - the West Coast is too competitive and low-yield, and Alaska is only able to survive with its low costs, and by hedging the more competitive intra-West Coast markets with its specialized high-yield flying in Alaska and in the regional Pacific Northwest where it faces 0 competition. If any other airline took it over, the costs would rise, and the network would be shuttered a la AA/QQ, US/PS, etc.

Quoting DLPhoenix (Thread starter):
AS is the perfect candidate for either CO or DL

If anything, AA would be the takeover partner, not CO or DL, both of which will likely be consumed with dealing with their far-larger mergers (UA and NW, respectively, if rumors are to be believed). Both of those combined companies will have very strong networks linking major hubs (DEN or SLC/MSP) to the Pacific Northwest, and largely won't need AS/QX.


User currently offlineSLCUT2777 From United States of America, joined Dec 2005, 4050 posts, RR: 11
Reply 4, posted (6 years 7 months 6 days 6 hours ago) and read 10600 times:



Quoting Jetjack74 (Reply 1):
or a merged NW/DL should consider AS as a potential target.

A merged DL/NW will want to have better feed into SEA for routes to Asia and the far east, and getting AS will make them the #1 player in the Puget Sound region. Having U.S. domestic flag carriers on these routes is the only way SEA is going to get them in large numbers with YVR just up the road.



DELTA Air Lines; The Only Way To Fly from Salt Lake City; Let the Western Heritage always be with Delta!
User currently offlineNzrich From New Zealand, joined Dec 2005, 1522 posts, RR: 1
Reply 5, posted (6 years 7 months 6 days 6 hours ago) and read 10589 times:

If UA ever got taken over and left star what about US taking over AS for its northwestern routes?


"Pride of the pacific"
User currently offlineSLCUT2777 From United States of America, joined Dec 2005, 4050 posts, RR: 11
Reply 6, posted (6 years 7 months 6 days 6 hours ago) and read 10576 times:



Quoting Nzrich (Reply 5):
If UA ever got taken over and left star what about US taking over AS for its northwestern routes?

AS is strictly 737s and HP+US is mostly Airbus. When the two carriers are that small in the overall spectrum, then that sort of fleet commonality becomes more of an issue than say DL merging with NW.



DELTA Air Lines; The Only Way To Fly from Salt Lake City; Let the Western Heritage always be with Delta!
User currently offlineIkramerica From United States of America, joined May 2005, 21511 posts, RR: 60
Reply 7, posted (6 years 7 months 6 days 6 hours ago) and read 10534 times:

AS is mainly domestic, and as such, most airlines are not looking to add domestic capacity. They don't bring any widebody aircraft to the table.

Which is not to say there aren't fits. CO, for example, has little presence in AS's territory, so it would be a "fill in the blank" merger to create a complete USA airline. AS also has Mexico authorities and traffic that CO would want. But if CO were to merge with UA, the need for AS's western presence disappears.

I also thought that CO+AS+AQ could be a viable combination, but it doesn't bring any more widebodies to the table.

In theory, NW+AS might also be a good fit if it weren't for fleets. DL+AS doesn't really work in terms of markets. AA+AS won't work because there's no way AS would allow it, given AA's history of buying and destroying west coast airlines.

US+AS might work, but again there's a widebody shortage. UA+AS makes no sense. In theory, FL+AS might be interesting.



Of all the things to worry about... the Wookie has no pants.
User currently offlineAirCop From , joined Dec 1969, posts, RR:
Reply 8, posted (6 years 7 months 6 days 4 hours ago) and read 10366 times:

If I remember right, during the last period of merging Alaska's Board of Directors passed a poison pill type provision that would make a unfriendly takeover extremely expensive.

Quoting Ikramerica (Reply 7):
NW+AS might also be a good fit if it weren't for fleets

I keep wondering why people keep promoting NW/AS. NW the last I checked is only #5 in number of passengers at Sea-Tac serving only MSP/DTW and once daily to MEM, while AS also codeshare with CO, DL, AA and just about everybody else that has a airplane.


User currently offlineCitrusCritter From Pitcairn Islands, joined May 2007, 1098 posts, RR: 3
Reply 9, posted (6 years 7 months 6 days 4 hours ago) and read 10342 times:



Quoting AirCop (Reply 8):
If I remember right, during the last period of merging Alaska's Board of Directors passed a poison pill type provision that would make a unfriendly takeover extremely expensive.

That's not even to consider the political firestorm that Alaska's congressional delegation would start in DC. The simple fact is that AS provides a valuable and unique service to a state that is still very much the frontier, or "The Last Frontier" as Alaska likes to call itself. No other airline in the US presently has the experience or perhaps inclination to run AS' Alaskan routes including the cargo runs given the specialty required in doing so.



TLH
User currently offlineASFlyer From United States of America, joined May 2005, 1170 posts, RR: 3
Reply 10, posted (6 years 7 months 6 days 3 hours ago) and read 10255 times:



Quoting AirCop (Reply 8):
NW the last I checked is only #5 in number of passengers at Sea-Tac serving only MSP/DTW and once daily to MEM

NW serves DTW 3 times daily, MSP about 5 or 6 times daily and MEM 1x daily. They also serve HNL, OGG and KOA from SEA daily and AMS and NRT. They are going to be starting SEA-LHR soon. During the summer, NW operates SEA-IND daily as well. They are a fairly large player at SEA, though not nearly as big as they used to be back in their day.


User currently offlineCIDflyer From United States of America, joined Apr 2005, 2285 posts, RR: 3
Reply 11, posted (6 years 7 months 6 days 3 hours ago) and read 10217 times:



Quoting AirCop (Reply 8):
while AS also codeshare with CO, DL, AA and just about everybody else that has a airplane.

doesn't NW code share with AS as well?


User currently offlineEVA777SEA From United States of America, joined Aug 2006, 473 posts, RR: 0
Reply 12, posted (6 years 7 months 6 days 2 hours ago) and read 10106 times:



Quoting ASFlyer (Reply 10):
NW serves DTW 3 times daily, MSP about 5 or 6 times daily and MEM 1x daily. They also serve HNL, OGG and KOA from SEA daily and AMS and NRT. They are going to be starting SEA-LHR soon. During the summer, NW operates SEA-IND daily as well. They are a fairly large player at SEA, though not nearly as big as they used to be back in their day.

MEM-SEA is 2x daily in summer and MSP was 8ish times daily last summer. They have no reason to operate more flights as they codeshare extensively with AS/QX. I could bet that if you include the pax on the AS/QX flights that booked through NW, the numbers would be much higher, especially considering NW's large FF base in SEA. Btw, SEA-NRT is 10x weekly next summer, 7x 332 and 3x 333, a large upgrade from last summer. (9x 332).


User currently offlineZkpilot From New Zealand, joined Mar 2006, 4819 posts, RR: 9
Reply 13, posted (6 years 7 months 6 days 1 hour ago) and read 10069 times:



Quoting DLPhoenix (Thread starter):
AS is the perfect candidate for either CO or DL:

Or US, AA.

Quoting Nzrich (Reply 5):
If UA ever got taken over and left star what about US taking over AS for its northwestern routes?

I would have thought that also... but as someone mentioned US has a large Airbus fleet. Still there is a large market for both A320 and 737 aircraft so it would not be hard for a merged airline to offload one type and purchase more of the other (perhaps 737NG or an updated A320 family). Its not unheard of for airlines to have a mix however as you would know of course Nzrich... NZ operates over a dozen of both 737 and A320 aircraft.



56 types. 38 countries. 24 airlines.
User currently offlineRwSEA From Netherlands, joined Jan 2005, 3093 posts, RR: 2
Reply 14, posted (6 years 7 months 5 days 23 hours ago) and read 9959 times:



Quoting AirCop (Reply 8):
I keep wondering why people keep promoting NW/AS. NW the last I checked is only #5 in number of passengers at Sea-Tac serving only MSP/DTW and once daily to MEM, while AS also codeshare with CO, DL, AA and just about everybody else that has a airplane.

As mentioned, NRT, AMS, LHR, HNL, KOA, and OGG are served, as well as IND on a seasonal basis. And the vast majority of the SEA-MSP flights are on 753s.

Quoting EVA777SEA (Reply 12):
Btw, SEA-NRT is 10x weekly next summer, 7x 332 and 3x 333, a large upgrade from last summer. (9x 332).

Excellent news - SEA-NRT is one busy flight for NW. At a minimum the flight should be a 333 daily, assuming it can carry a decent amount of cargo.


User currently offlineHAL From United States of America, joined Jan 2002, 2560 posts, RR: 53
Reply 15, posted (6 years 7 months 5 days 23 hours ago) and read 9949 times:

Alaska likes to be independent, and wants to stay that way. However, I wouldn't put it past them to acquire an airline like Hawaiian or Aloha and put it under the "Alaska Air Group" umbrella, much as Horizon is now. It would remain a separate airline, but with one overall management group.

HAL



One smooth landing is skill. Two in a row is luck. Three in a row and someone is lying.
User currently offlineNWAESC From United States of America, joined Aug 2007, 3386 posts, RR: 9
Reply 16, posted (6 years 7 months 5 days 23 hours ago) and read 9941 times:



Quoting CIDflyer (Reply 11):
doesn't NW code share with AS as well?

Yes. Extensively. Lots of traffic between the two, especially in SEA and PDX.



"Nothing ever happens here, " I said. "I just wait."
User currently offlineLACA773 From United States of America, joined Nov 2004, 4008 posts, RR: 2
Reply 17, posted (6 years 7 months 5 days 21 hours ago) and read 9553 times:
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Quoting Jetjack74 (Reply 1):
I think AA or a merged NW/DL should consider AS as a potential target. It would stregthen there position in the west.

I surely hope AA stays out of any type of west coast aquisition. They destroyed Air Cal & later on Reno Air, not to mention what happened to TWA.

I've been thinking & wondering for sometime now if a combination of AS & DL would work? Fleets are compatible and they can give DL the extra strength of the Pacific Northwest, Alaska and the all important Mexico. I'd like to know more thoughts about this too.
What other's think. I know they don't have any widebodies but the routes they serve with the extensive 73G fleet serves them well.

LACA773


User currently offlineSJC4Me From United States of America, joined Jul 2006, 373 posts, RR: 1
Reply 18, posted (6 years 7 months 5 days 20 hours ago) and read 9454 times:

Semi OT: Are the new lei's that are being painted on Alaska's 738s going to be permanent or just there briefly for advertising?


Unable.
User currently offlineDesertAir From Mexico, joined Jan 2006, 1461 posts, RR: 0
Reply 19, posted (6 years 7 months 5 days 20 hours ago) and read 9377 times:

Even the thought of Alaska being merged into one of the bland mega carriers makes me want to scream. AS is one of the last interesting carriers of the west. AS is a life line for the state of Alaska; has a hub in Portland, a city that sees limited service from many major carriers; is partnered with Horizon, a sucessful regional, a hub in Seattle; and has become a major player in the West Coast-Mexico market. Save our West Coast Airlines-in memory of PSA, AirCAL, Reno Air, Western Airlines, Hughes AirWest and the list goes on...

User currently offlinePavlovsDog From Norway, joined Sep 2005, 657 posts, RR: 0
Reply 20, posted (6 years 7 months 5 days 19 hours ago) and read 9134 times:



Quoting HAL (Reply 15):
Alaska likes to be independent, and wants to stay that way. However, I wouldn't put it past them to acquire an airline like Hawaiian or Aloha and put it under the "Alaska Air Group" umbrella, much as Horizon is now. It would remain a separate airline, but with one overall management group.

I agree with you. Hawaiian Holdings and Alaska Airline Group should merge (without cash changing hands) and then use their increased financial muscle to purchase Aloha. That would be a very competitive airline.


User currently offlineImperialEagle From United States of America, joined Jan 2006, 2530 posts, RR: 22
Reply 21, posted (6 years 7 months 5 days 18 hours ago) and read 9095 times:
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I always wondered why Air Tran would spin their wheels trying to work out a deal with Midwest, when they could go after Alaska.

A hub on the west coast would turn Air Tran into a powerhouse, and provide inexpensive connections from the mainland to the carriers serving the Pacific Rim. A trans-con leg between ATL-SEA. Some aircraft commonality with the 737 fleet.
IMO it would be a great combination.



"If everything seems under control, you're just not going fast enough!"
User currently offlineLike2flyguy From United States of America, joined Jan 2008, 95 posts, RR: 0
Reply 22, posted (6 years 7 months 5 days 18 hours ago) and read 8874 times:

I dont think Alaska will merge with anyone, because they already code-share with almost everybody. They're actually sitting quite pretty... flights from their hubs (mainly SEA, PDX, and LAX) are fed by almost every other major airline in the United States. And now, they even can send their international travelers on Northwest (and I'm sure many other major airlines) non-stop to Narita/Tokyo, Osaka, Amsterdam, and Paris (just to name a few).

Now is that a deal or what?


User currently offlineJustPlaneNutz From United States of America, joined Feb 2006, 519 posts, RR: 1
Reply 23, posted (6 years 7 months 5 days 18 hours ago) and read 8838 times:



Quoting LACA773 (Reply 17):
surely hope AA stays out of any type of west coast aquisition

Exactly.

AA would be much better served by buying B6, if any of the mid-majors. As Air Cal, Reno and PSA showed, low-yield traffic combined with low/no barriers to entry make the West Coast not viable once the acquiring major's cost structure is applied to the mergee.

With B6, AA would leverage its existing investment in JFK (brand new terminal with plans on file for 20 more gates) and BOS, where there are both high-yield traffic and significant barriers to entry. AA stands a much better chance of making that work than AS.


User currently offlineAsuflyer05 From United States of America, joined Feb 2004, 2371 posts, RR: 3
Reply 24, posted (6 years 7 months 5 days 17 hours ago) and read 8559 times:



Quoting DLPhoenix (Thread starter):
So why is nobody pushing for it Confused
My twocents : Such a merger will not generate the Buzz required for the "Merger Community" to make a quick profit in the stock market.

Orlly?

Do you post on another aviation website?


25 Wedgetail737 : If AS was swallowed up by one of the major carriers, i.e. AA, NW or CO, that would be a detriment to the Pacific Northwest and the State of Alaska. Th
26 Socalatc : I ask, why isn't Alaska trying to buy another airline. AQ would be perfect for Alaska. I think Alaska will continue to grow and make their name well k
27 LY4XELD : I'll bite - no, they're only temporary and were there to promote the new Hawaiian routes. They'll be removed as the airplanes go through maintenance,
28 CitrusCritter : AirTran could not afford Alaska. They had difficult working out the financing for the Midwest deal. Additionally, FL does not seem to like the cargo
29 DLPhoenix : Thanks for all the responses. I have seen quite a few suggestions why: - Non of the legacy carriers can afford AS - I agree, but neither can they affo
30 ImperialEagle : But before long it may turn out that they cannot wait for something they can "afford" -------they may just need to be sporty to survive. I, for one,
31 Wedgetail737 : I seriously doubt any large carrier will keep 20% or more of the Alaska's network between SEA and AK (and within AK), based on the history of large c
32 GentFromAlaska : Here's a tidbit from Bill Ayer to USA Today "Ayer also touched on the topic of consolidation, though Alaska Air has so far been left out of the most-c
33 ForeverUnited : I'd have to agree with most of the other sentiments on this thread. Alaska is not a takeover target. With a strong balance sheet, the aforementioned "
34 Jkj777 : AS has no presence in Asia, India, Europe, Africa, or even South America. It would not make sence for DL to merge with AS due to this alone. They (DL)
35 FlyPBA : Aloha would make the best addition to the Alaska Air Group ... similiar aircraft types ... similar challenges with operating regions ... similar style
36 FlyPBA : Aloha would make the best addition to the Alaska Air Group ... similiar aircraft types ... similar challenges with operating regions ... similar style
37 GentFromAlaska : If memory serves me AS offers many of their small community flights under the Essential Air Service (ESA) Act. In addition to Yakutat Petersburg PSG
38 ForeverUnited : Yeah, the EAS stipend isn't a whole lot though. It's not meant to *pay* for the service, merely to support it.
39 A380US : Well isnt AS really in the regional market? they dont seem to operat too many long hauls
40 AirNZ : What exactly is a US domestic flag carrier? I thought that term was hated by Americans on here (no offence whatever meant by that!)
41 Commavia : A U.S. "flag carrier" simply means an American airline, based in America and owned and run by Americans, that is authorized by the United States fede
42 Travatl : I agree with the previous posters regarding an AirTran/Alaska deal. I think it would be ideal, provided the surviving culture/service were Alaska's. G
43 HNL-Jack : CO/AS perhaps, but AQ brings nothing to the table that can't be achieved without them, and without the burden of the interisland routes.
44 Reltney : Who is AS B6 or what other weird slang names are out there. I have been flying for 20 years with the airlines and never heard of these. Are these new
45 Rockinflyer : I hope so too! I wouldn't want to see a US/AS combo either. US cannabalized PSA like AA did to Air Cal and Reno Air. I cant see AA or US being TRULY
46 Post contains images EA CO AS : AS = Alaska Airlines. And they've been around for 75 years. Interesting how most everyone here assumes that in a merger, AS would be the one being ac
47 AA767400 : AA would not gain anything from AS except for their added fleet. AA can't make the west coast work. And US won't work because of the new USairways ha
48 JustPlaneNutz : My argument would be that as the legacy the suffered the most form B6's rise, AA would benefit the most from its demise. That would be particularly t
49 B6WNQX : The two letter codes are what designates who they are: WN: Southwest Airlines AS: Alaska Air CO: Continental B6: JetBlue F9: Frountierr LH: Lufthansa
50 Kohflot : Since we're having fun speculating.. it'd be difficult to manage, but a conglomeration of a handful of carriers is neat to think about. Alaska, AirTr
51 PavlovsDog : Alaska has thrived by keeping it simple and doing what they do really well. I don't see them becoming an airline with a national scope anytime soon. H
52 Bobnwa : Every airline in the world has a two letter(digit) code and has had it for a least 50 years. That is how airlines are identified in the computer syst
53 Viscount724 : That's not correct. The 3-letter codes are official ICAO codes and are not just "airline slang". They are used for many operational purposes (air tra
54 HNL-Jack : HA would be worth considering. Both have similar operating strategies. Strong local service in their namesake states while developing long haul out a
55 Ckfred : Because of AS's cost structure, wouldn't it make better sense for AS to merge with an LCC, such as Air Tran? Air Tran went after ATA, hoping to add a
56 Surfpunk : If it will get him to quit, somebody should initiate faux merger talks, just for general principles. I just wish he would have followed through on hi
57 Post contains images EA CO AS : I've gotta admit, the thought of AS buying FL makes me drool...
58 Post contains images CitrusCritter : So long as they would maintain a LFC approach, FL's present operations at ATL and MCO, and keep a sizeable corporate/operational operation in Orlando
59 Post contains images EA CO AS : Why else would one buy FL? Without ATL, there's really not much to buy... You 'could live with that,' you say? How big of you. Not necessarily. AS wo
60 STT757 : CO's CEO Larry Kellner was interviewed recently regarding mergers, while going through the obligatory we are able to go it alone speech Larry did ment
61 AS739X : Another issue on the table with Alaska is the Horizon factor, should not be forgotten. Alaska taking over ATA is off limits I think. Arn't they partia
62 Post contains images CitrusCritter : As a resident of the City of Orlando, I would not take kindly to the money we've put out for FL's HQ just disappearing to SEA because of a buyout. Th
63 Spirtofalaska : Well i'll put in my two cents...w/o reading all the 65 or whatever posts...so if this was discussed...my apologies, BUT...The rumor on the jumpseat...
64 AS739X : Unfortunately our stock has dropped badly and we can no longer boast that we are out of everyone's range. That being said, the poison pill by the exe
65 EA CO AS : That's how AS and QX work - Horizon is a wholly-owned subsidiary of Alaska Air Group and funnels much traffic to/from AS, but they're truly two separ
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