LGBFltTrainer From United States of America, joined Feb 2005, 100 posts, RR: 0 Posted (4 years 1 month 6 days ago) and read 15364 times:
I received an email from a friend who is somewhat high up in the AA food chain. While writing about how busy he's been, he eluded to one of things keeping him busy is, "the thing with AA and JetBlue," but he didn't give anything more specific.
My curiosity is suddenly heightened. Anyone know what this might be? (I didn't see anything posted previously).
enilria From Canada, joined Feb 2008, 7722 posts, RR: 15
Reply 5, posted (4 years 1 month 5 days 23 hours ago) and read 14823 times:
Quoting LGBFltTrainer (Thread starter): I received an email from a friend who is somewhat high up in the AA food chain. While writing about how busy he's been, he eluded to one of things keeping him busy is, "the thing with AA and JetBlue," but he didn't give anything more specific.
They already announced an alliance, so what's so surprising? They aren't merging.
richierich From United States of America, joined Nov 2000, 4298 posts, RR: 6
Reply 7, posted (4 years 1 month 5 days 22 hours ago) and read 14487 times:
Fantastic, AeroWesty! I will certainly be using that on some unsuspecting co-workers at some time!!!
But seriously, is there anything new anybody can add to the agreement between AA and B6? I've heard rumors of B6 running BDL-SJU (most likely in lieu of AA) or possibly more DCA-JFK slot swaps. Any meat to these?
The slots that have been swapped recently have primarily been un-used slots at JFK swapped out for much needed slots to get our foot in the door elsewhere. I can't see B6 giving up too many JFK slots if they expect to continue their expansion in the Caribbean and South America which is making them BIG money. Just my
"If you do not learn from history, you are doomed to repeat it"
Actually, that isn't as unlikely as it sounds...but I don't think B6 was happy that AA dumped the last round of slots in B6 markets like FLL/LAS rather than int'l which where I am sure they expected them to go. Ultimately, they may still go international, but AA didn't have much time to put anything other than a temporary plan together to block the slots.
AA1818 From Trinidad and Tobago, joined Feb 2006, 3439 posts, RR: 4
Reply 13, posted (4 years 1 month 5 days 21 hours ago) and read 13908 times:
Quoting richierich (Reply 7): But seriously, is there anything new anybody can add to the agreement between AA and B6? I've heard rumors of B6 running BDL-SJU (most likely in lieu of AA) or possibly more DCA-JFK slot swaps. Any meat to these?
Clever Response, but I don't think that's entirely fair. I think what we've seen so far from AA and B6 is just the tip of the iceberg so to speak. More extensive codesharing is ATI can be approved for them. Handing over of SJU routes to B6 perhaps. Maybe even the deepening of their Mileage accrual agreement etc., joining of oneworld perhaps by B6 is a possibility.
“The moment you doubt whether you can fly, you cease for ever to be able to do it.” J.M. Barrie (Peter Pan)
DALALWAYS From United States of America, joined Dec 2009, 97 posts, RR: 0
Reply 14, posted (4 years 1 month 5 days 20 hours ago) and read 13632 times:
There had been talk of AA divesting Eagle. IF this was to happen, could B6 be looking to take the SJU hub and route authority. B6 has already begun to beef up its presence there. I mean they are adding SJU-JAX, that will be the only scheduled international flight out of JAX. I may be "talking out my neck" here but I thought that it could be a possibility. By code sharing and aligning out of JFK, and IF the divestiture of Eagle took place, it would put them into a very cozy position. I am just excited to be in the industry right now, never since deregulation has there been such major activity in commercial aviation. Decisions made whether right or wrong, with any airline, provides great insight into the industry!
jfk777 From United States of America, joined Aug 2006, 8517 posts, RR: 6
Reply 16, posted (4 years 1 month 5 days 20 hours ago) and read 13499 times:
With all the airline mergers all the good partners are married. USairways and AA just don't make sense. JetBlue would give AA tons of slots and feed at JFK. While AA has a lousy merger record with Air Cal and RENO Air, those two were about the west coast, AA has never merged with an airline helping its east coast business. JB would give AA mass on the eats coast since JB is a huge airline at Boston and JFK.
jetlanta From United States of America, joined Jul 2001, 3365 posts, RR: 35
Reply 18, posted (4 years 1 month 5 days 18 hours ago) and read 13030 times:
Quoting jfk777 (Reply 16): With all the airline mergers all the good partners are married. USairways and AA just don't make sense. JetBlue would give AA tons of slots and feed at JFK. While AA has a lousy merger record with Air Cal and RENO Air, those two were about the west coast, AA has never merged with an airline helping its east coast business. JB would give AA mass on the eats coast since JB is a huge airline at Boston and JFK.
I actually strongly disagree that a AA/B6 merger is a good idea for AA. I made the following points on the DL/JFK thread:
Quote: a AA/B6 merger makes no sense without a combined operation. The cost of doing that for AA would likely SIGNIFICANTLY overshadow the benefit of buying B6 in the first place.
Think about these scenarios:
AA/B6 move to an expanded T8...
----Probably close to $1B in construction at T8.
----BA and IB can't move to T8, reducing the long-term JV benefit.
----Continued obligation to pay off T5. Its a domestic terminal, so basically only Delta could make use of it.
----Reduction in combined AA/B6 flying due to limited space at T8, especially at peak periods.
AA/B6 remain in current terminals...
----Split operation is expensive and inefficient.
----Revenue benefit is MUCH smaller due to bad connectivity.
----T5 is a domestic terminal, forcing AA to run a larger domestic operation at JFK except at AA costs, not B6 costs.
----BA and IB can move to T8, which is positive.
At the end of the day, I don't see how the economics of a AA/B6 merger work. The integration costs alone are probably as much as the airline itself. Ironically, the cost of a DL/B6 merger to DL are MUCH lower. All they would need to to do is build a bridge between T4 & T5. That means that the cost of such an acquisition to DL is dramatically lower than it is for AA. From a financial perspective, the deal is much better for DL than AA.
A couple of caveats, if the US/DL swap goes through, DL would have no need for B6. If it doesn't go through, I'd wouldn't expect DL to let a AA/B6 merger happen without a fight. A fight that Delta would likely win on financial terms. However, the question would be DOT/DOJ approval.
I think the real story here is how little buying B6 actually helps AA. It would be WILDLY expensive just in terms of facilities. Once you bring B6 employees up to AA wages, it is no longer a low fare carrier and will not be able to support the network it has today. What AA will be stuck with is a terrifically expensive acquisition of a few decent JFK slots. The reasons people fly B6 from JFK today are brand and fares. Take those away and LGA and EWR will again dominate competitive markets. Even today, B6 can't make anything resembling a business market inside the LGA perimeter work from JFK. It is just not an appealing airport for business travelers when they have a choice.
LAXtoATL From United States of America, joined Oct 2009, 1658 posts, RR: 2
Reply 20, posted (4 years 1 month 5 days 17 hours ago) and read 12846 times:
As for a merger between AA & B6...
I don't think it is happening now or any time soon! Too many people only look at what's in it for AA. But if you look from the other side... JetBlue is much more valuable by itself, why would the shareholders of JetBlue want to merge with AA? I see no benefit, right now and for the forseable future JetBlue is more profitable by itself. And with the additional feed they will be getting from AA with their current arrangement will only make them more profitable as a stand alone. This current arrangement is a win-win for both airlines but it is a bigger win for JetBlue and I see no reason for them to even consider a merger with AA. Membership into OneWorld might be an option but I don't see a merger or any type of ATI.
flyby519 From United States of America, joined Jul 2007, 1235 posts, RR: 0
Reply 22, posted (4 years 1 month 5 days 14 hours ago) and read 10652 times:
If AA/B6 ever proposed a merger the DOT would go ballistic and require the two companies to divest a huge number of JFK slots to LCC competitors, which would put AA right back where it is today with B6 undercutting its domestic routes. Makes zero sense for AA or B6. oneworld membership would be much more likely, and would benefit B6 by providing feed for AA int'l flights, and the rest of the oneworld partners serving the east coast.
These postings or comments are not a company-sponsored source of communication.
MAH4546 From Sweden, joined Jan 2001, 33289 posts, RR: 71
Reply 23, posted (4 years 1 month 5 days 14 hours ago) and read 10606 times:
Quoting flyby519 (Reply 22):
If AA/B6 ever proposed a merger the DOT would go ballistic and require the two companies to divest a huge number of JFK slots to LCC competitors,
Actually, it probably wouldn't. JetBlue+AA wouldn't be much larger than just Delta. Yes, slot divesture would likely be required, but nothing significant. From the top of my head, DL has around 230-240 slots, B6 around 150-160, and AA around 120.
jetlanta From United States of America, joined Jul 2001, 3365 posts, RR: 35
Reply 24, posted (4 years 1 month 5 days 14 hours ago) and read 10495 times:
Quoting MAH4546 (Reply 23): Actually, it probably wouldn't. JetBlue+AA wouldn't be much larger than just Delta. Yes, slot divesture would likely be required, but nothing significant. From the top of my head, DL has around 230-240 slots, B6 around 150-160, and AA around 120.
Even at that, I'm not sure there'd be remotely enough concentration to warrant divestiture. Delta has closer to 200, btw.
: Wow, DL is much bigger than I thought in terms of slots in JFK. Thanks for the info. I assumed B6 was a close 2nd behind them
: Well, DL is using a much larger concentration of RJs, while JetBlue and AA aren't. This brings the passenger numbers closer together.
: "Wow, DL is much bigger than I thought in terms of slots in JFK. Thanks for the info. I assumed B6 was a close 2nd behind them" Actually . . . B6 is t
: I assume you just threw this out there without any actual knowledge of how merges and acquisitions actually work. If AMR offered JetBlue 50% premium
: SJU is a territory. Not in the United States, however thank you for the geography lesson.
: You are welcome, but you still don't seem to understand. Puerto Rico is a commonwealth and it is in the United States. Being a commonwealth does not
: It's still not an international flight. If JetBlue started JAX-STT tomorrow, it won't be considered an international flight, just like SJU. So saying
: I am not sure how you figured this out but 1. the current market cap of jetBlue is just short of $2b as of close of today so AA could just buy out th
: The term "United States" when used in a geographical sense on official documents, acts and/or laws; includes the Commonwealth of Puerto Rico, the Vir
: As soon as its leaked that AA is the one purchasing shares watch the price of B6s shares jump significantly (moreso than if a purchase agreement was
: DL is flying 150-160 peak day flights out of JFK this winter. B6 around 150 AA around 100
: It certainly will have an impact on the B6 share price but not that huge. I would imagine that the AA shareholders would be on board with the plan be
: Can B6 be a potential customer for American Eagle? AA has made a couple overtures in hopes of divesting American Eagle to someone... anyone. I think a
: "Peak day" flights is not an indication of total slot holdings, as not all slots need to be used every day.
: It is an indication however that 80 or so slots that DL may or may not have are probably not economically viable...
: AMR cannot go out and buy shares on the open market like an individual. There are plenty of ways that one company can finance transactions to buy oth
: It is not an international flight. Just like SJU-GUM would not be an international flight or LAX-STX I would love to see it happen, or at least an AT
: Yeah, I don't know why people keep thinking that SJU is considered international. STX and STT are also domestic. B6/US wouldn't make much sense, the
: What If Jetblue buys American, hmmmmmm!