TWA772LR From United States of America, joined Nov 2011, 940 posts, RR: 1 Posted (5 months 3 weeks 1 day 6 hours ago) and read 5799 times:
CO and Eastern were both owned by Frank Lorenzo's Texas Air Corporation before Eastern went belly up. And CO received, among many assets, the OnePass program and A300s. My question is, why didn't Lorenzo merge EA and CO like he did with all his other airlines that Texas Air owned like New Yourk Air, PeoplExpress, etc...?
I also know that CO was extremely close to purchasing L1011s in the late 80s/early 90s before the 777 came online, but opted for more DC-10s at the last second. These L1011s would have been extremely cheap since they could've been acquired from Eastern after their demise. What made CO stick to more DC-10s instead of a plane that was supposedly more superior?
Sidebar, what would a CO/EA merger have looked like? And how would that have changed the industry?
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boeing773ER From United States of America, joined Dec 2011, 360 posts, RR: 0 Reply 1, posted (5 months 3 weeks 1 day 6 hours ago) and read 5778 times:
Well, one of the big rumors of the time was that Lorenzo bought Eastern to take it apart. People believe he just wanted it for certain parts, and didn't want the true airline. Which is kind of true because look at where Eastern is now.
There is quite a good video/series on youtube about it called "Battle for Eastern Airlines" It was a series made by Dateline that really looked into the history of Eastern, the labour problems, and when Lorenzo bought them.
planesntrains From United States of America, joined Feb 2005, 4999 posts, RR: 29 Reply 2, posted (5 months 3 weeks 1 day 6 hours ago) and read 5699 times:
I seem to remember that a lot of the issues revolved around the unions at Eastern and Lorenzo wanting to get rid of them, or at least the high cost. I thought his goal was to rob Eastern of it's assets (my words) and place them at CO so that he could kill off Eastern but still have the assets to utilize. I guess that didn't work out the way he expected but then again, that whole period was a real cluster for/with Texas Air.
I think the two could have been a compelling pair but looking back it would have been a real nightmare merging it all together.
SpaceshipDC10 From Canada, joined Jan 2013, 1100 posts, RR: 2 Reply 3, posted (5 months 3 weeks 1 day 4 hours ago) and read 5570 times:
Quoting TWA772LR (Thread starter): What made CO stick to more DC-10s instead of a plane that was supposedly more superior?
Two reasons. Range and fleet commonality. All the DC-10s that CO bought were series 30 that were a lot more capable on the matter of take off weight and range than EA's TriStar 1. Back then, CO had a wide body fleet made of A300, B747-100 & -200 and DC-10-10 & -30. Why add another type ?
DarkSnowyNight From United States of America, joined Jan 2012, 1199 posts, RR: 2 Reply 4, posted (5 months 3 weeks 1 day 4 hours ago) and read 5563 times:
Quoting planesntrains (Reply 2): I seem to remember that a lot of the issues revolved around the unions at Eastern and Lorenzo wanting to get rid of them, or at least the high cost.
Right. Everyone remembers Lorenzo (and rightly so) for what happened at EA, but it's worth noting that Charlie Bryan had as much to do with the downfall. While it is true that Lorenzo likely just wanted EA for the parts, Bryan's quickness to strike certainly made that a very, very easy task.
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jfk777 From United States of America, joined Aug 2006, 7816 posts, RR: 8 Reply 7, posted (5 months 3 weeks 18 hours ago) and read 4910 times:
Continental purchased Dc-10-30 because they already flew those birds in their Australian flights. EA L-1011 were batered and in bad shape by the late 1980's. Delta did buy some EA L-1011 but they and TWA were the other two big L-1011 operators.
TW870 From United States of America, joined Jan 2013, 101 posts, RR: 0 Reply 13, posted (5 months 3 weeks 8 hours ago) and read 3611 times:
Quoting TWA772LR (Thread starter): My question is, why didn't Lorenzo merge EA and CO like he did with all his other airlines that Texas Air owned like New Yourk Air, PeoplExpress, etc...?
On September 24th, 1983, Lorenzo - who had bought Continental in a leveraged buyout in 1981 - shut Continental's doors and declared bankruptcy. He reopened a few days later, extending offers to about 40% of previous employees to come back to a roughly 50-60% reduction in pay, benefits, and work rules. Though the operation was miserable, it gave Continental a significant labor cost advantage.
After Lorenzo conducted the leveraged buyout of Eastern in 1986, that airline's collective bargaining agreements were still in effect, and remained in effect until the strike on March 4th, 1989. Had he merged Eastern into Continental, he would have had to negotiate with union leaders at Eastern about working conditions at the new company (assuming a majority or merged employees would have certified the union). Thus, it was ultimately cheaper for Lorenzo to syphon assets off of Eastern and have them operated by the much lower paid Continental workforce. But that, of course, took time and training. Rather than transfer whole fleets - like the 757s and L1011s for example - Lorenzo ramped up the anti-union campaign at Eastern, and ultimately baited the strike, hoping to bring Continental wages to the entire Eastern operation, including the L1011 fleet. The Eastern employees did not go along with that plan.
I also question the authenticity of the safety cards - at least in operational terms. Lorenzo put a lot of pressure on the Eastern employees, often purposely leaking memos about plans to dismember the airline. If these safety cards would have hit the Eastern employees, there would have been a lot of drama. I mean maybe there was - but I have never, ever come across a Continental L1011 rumor scandal on all my research on airline labor issues in the 1980s.
Quoting cf6ppe (Reply 12): Btw, I worked at EAL for eighteen years leaving about a year before the strike.
I got the cards years ago when my mom was still with EA, and she stayed on with CO after 1991 since they'd merged the sales forces of both carriers and she was technically employed by both.
I like to say I owe my life to Eastern Air Lines since my parents ('63 hire and '64 hire) met there working at JFK. My dad went on to leave the industry but my mom stayed with EA until 1991, then remained with CO until 2003.
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan
Interesting. I see the 4/90 date on the card. That was during month 13 of the strike at Eastern. I am forgetting what percentage of their capacity they were running by that point. But I don't fully understand why Lorenzo would have wanted to transfer L-1011s from Eastern to Continental that late in the game. Eastern was running with strikebreakers who were making the new payscale that was very comparable to Continental. I am not sure what Lorenzo would have gained from the transfer, as Continental's cost advantage ultimately evaporated with strikebreakers re-staffing Eastern. Obviously it never panned out....
zippyjet From United States of America, joined Sep 2001, 5130 posts, RR: 13 Reply 17, posted (5 months 2 weeks 6 days 15 hours ago) and read 2650 times:
Quoting DarkSnowyNight (Reply 4): Right. Everyone remembers Lorenzo (and rightly so) for what happened at EA, but it's worth noting that Charlie Bryan had as much to do with the downfall. While it is true that Lorenzo likely just wanted EA for the parts, Bryan's quickness to strike certainly made that a very, very easy task.
Lorenzo would have stripped mined Eastern unions or not. So sure if you want to blame Bryan of the IAM go ahead but lets face it Lorenzo was the devil incarnate to our industry and he proved it many times over with his empire of malcontent. Hammering in the final nail into Eastern's coffin while eliminating People Express in the process and putting a lot of employees of all these airlines through hell. Lorenzo epitomizes the greed and corruption besides bad taste of the 1980's. At least in my opinion! An L1011 in the Continental Gold "Meatball" would have been interesting and the globe logo of today's comined "Unental" would look fierce.
However why introduce another aircraft type into the mix of CO? Especially with Lorenzo the terrible trying to suck gold out of a turnip.
EA CO AS From United States of America, joined Nov 2001, 12935 posts, RR: 63 Reply 18, posted (5 months 2 weeks 6 days 14 hours ago) and read 2606 times:
Quoting zippyjet (Reply 17): Lorenzo would have stripped mined Eastern unions or not.
Perhaps, but he would have also needed trained employees to make use of those EA assets. The fact of the matter is that while I'm no fan of Francisco Lorenzo, even if he'd been unopposed by labor, many more jobs would have been saved under his plans than under Charlie Bryan's foolhardy decision to orchestrate the IAM walkout and sympathy strikes.
And lest we forget, EA had outsourced MX and ramp waiting to take over for the IAM employees; it was only the sympathy walkouts by ALPA and the flight attendants that brought EA to a near halt in 1989. Saddam Hussein is who finally killed EA with his invasion of Kuwait.
"In this present crisis, government is not the solution to our problem - government IS the problem." - Ronald Reagan
SpaceshipDC10 From Canada, joined Jan 2013, 1100 posts, RR: 2 Reply 22, posted (5 months 2 weeks 5 days ago) and read 2063 times:
Quoting cornutt (Reply 20): I believe all the ones Delta acquired were -500s, which had higher capacity and significantly better engines.
The -500 is smaller than all the other L-1011s, meaning it carries less passengers. As already said EA only operated L-1011-1s and of all the -500s Delta had, three were brand new aircraft, three acquired from Pan Am, five from United and six from Air Canada.
SpaceshipDC10 From Canada, joined Jan 2013, 1100 posts, RR: 2 Reply 24, posted (5 months 2 weeks 5 days ago) and read 2045 times:
Quoting jfk777 (Reply 23): Pan AM which sold their 12 L-1011-500 when they merged with National who had dc-10's.
That's not accurate. Pan Am received their L-1011 at about the time they merged with National. Six of the L-1011s and one DC-10-30 were sold to UA along with the 747SP and the Pacific Network. Of the other six L-1011s, three went to DL and three to the Royal Air Force. All this happened during the mid-80s. All the other former National DC-10 were sold to American around that time.
25 superjeff: You are absolutely right. If it weren't for Charlie Bryan, Lorenzo would never have acquired Eastern. The company allowed Lorenzo to take over the co
26 zippyjet: Then not to sound redundant who would have gotten control of Eastern?
27 zippyjet: Then not to sound redundant who would have gotten control of Eastern?
28 sankaps: I think you ARE in fact sounding redundant...!
29 Viscount724: Yes, Pan Am's first L-1011-500 wasn't delivered until 5 months after the ill-conceived merger with National was approved. And all except a few Nation
30 cf6ppe: At the point/time of your question, Texas Air Corporation - i.e., Lorenzo - already had control of Eastern.
31 drr49: Charlie Bryan hated Frank Borman more than he did Frank Lorenzo. In 1986, EAL was facing severe financial pressure from the banks to reduce operating
32 SpaceshipDC10: In addition to my previous post and to be exact, Pan Am merger with NA officially happened on January 7, 1980. They received their first L-1011 three
33 EA CO AS: Hollis Harris came over from DL to run CO before Gordon came over from Boeing.