zona8
Posts: 120
Joined: Sun Oct 05, 2003 11:32 am

Could Virgin USA Buy Part Of US Airways?

Sat Jan 10, 2004 7:17 am

First, I have absolutly no knolage of this, just thinking about it.

I saw on the fourm that US Airways is looking to sell a hub and planes and I just read an artical (part below) that Virgin USA may just by part of another airline rather than start fresh. Again, just wondering and wanted any insight.

"He [Branson] also said Virgin is evaluating two alternatives: Launch an all-new airline or acquire an existing operator. "It could go either way," he said, adding that the company is in discussions with an airline about the possibility of "carving off chunks of that operation." Singapore Airlines, which owns 49% of Virgin Atlantic, also is expected to invest in the new carrier. Two names begin considered are Virgin Red and Virgin USA. Branson said that despite the presence of Southwest Airlines, JetBlue and other low-cost carriers, there still is plenty of room for another low-fare airline."
 
texan
Posts: 4059
Joined: Tue Dec 23, 2003 2:23 am

RE: Could Virgin USA Buy Part Of US Airways?

Sat Jan 10, 2004 8:36 am

Branson is right about there being enough room for another low-fare airline or two. But as far as Virgin buying part of USAirways, it will all depend on where Branson decides to base the airline. If it is based in BOS, it makes sense to buy the Shuttle and other assets and routes from BOS. The Shuttle gives them instant recognition in the NE Corridor, and taking, say, some US 737s or 319s to operate the Shuttle and other various routes out of there, they have a good base with good connections. Obviously, if someplace like SFO is chosen, it does not make sense for Branson to buy part of US. But US has a lot of routes out of BOS, so why not make a play for them? Anywho, it'll be interesting to see how this pans out.

Texan
"I have always imagined that Paradise will be a kind of library."
 
Danny
Posts: 3714
Joined: Thu Apr 25, 2002 3:44 am

RE: Could Virgin USA Buy Part Of US Airways?

Sat Jan 10, 2004 8:39 am

US Airways sucks. I would keep away from them if I wanted to start succesful airline.
 
texan
Posts: 4059
Joined: Tue Dec 23, 2003 2:23 am

RE: Could Virgin USA Buy Part Of US Airways?

Sat Jan 10, 2004 8:47 am

But you don't buy out the entire company, just a couple pieces that you want, that will make you more competitive in the marketplace. The Shuttle and expanded BOS connections make a big splash really quickly without having to build your routes from the ground up. I wouldn't think Virgin USA would start out by buying USAirways routes, but it is a possible solution.

Texan
"I have always imagined that Paradise will be a kind of library."
 
flyinggizmo
Posts: 92
Joined: Sat Dec 27, 2003 6:51 am

RE: Could Virgin USA Buy Part Of US Airways?

Sat Jan 10, 2004 9:36 am

Danny...

Why thank you for such a blanket statement like that. It seems you are either short big on rudeness or short on brains. Please, at the risk of offending an employee of US Airways, tell me what "sucks" about it in your opinion. And please show me an airline that DOESN'T have any problems.

It is people like you who represent what is wrong with America today.
 
BCAInfoSys
Posts: 2617
Joined: Thu Sep 11, 2003 11:09 pm

RE: Could Virgin USA Buy Part Of US Airways?

Sat Jan 10, 2004 9:40 am

I'm with Flyinggizmo. Granted, I've only flown US on 4 segments, but I have had nothing but positive experiences with them. In fact, I count my best EVER flight as the 1st of my 4 segments. (SEA-PIT [752], PIT-AVP [733], AVP-PIT [Dash8], PIT-SEA [A319])

I for one will be very sad to see US Airways go, if they do indeed fold.
Militant Agnostic - I don't know and you don't either.
 
ushermittwoch
Posts: 2530
Joined: Fri Jan 09, 2004 10:18 pm

RE: Could Virgin USA Buy Part Of US Airways?

Sat Jan 10, 2004 9:41 am

The thing on the US market in my opinion is that there is NO real LOW cost carrier. Maybe the costs of the carriers are low but surely not their fares!
That is one thing they will have to learn from European airlines, although the routes in the US might be longer. Sometimes a "lowest" fare from $79 isn't really low...
Where have all the tri-jets gone...
 
AA717driver
Posts: 1502
Joined: Tue Feb 12, 2002 8:27 am

AA CFO Resignation...

Sat Jan 10, 2004 10:01 am

There would certainly be a bunch of A32's available. Also delivery slots for E170's.TC
FL450, M.85
 
AIR757200
Posts: 1466
Joined: Mon Jul 17, 2000 8:30 am

RE: Could Virgin USA Buy Part Of US Airways?

Sat Jan 10, 2004 12:15 pm

Here's a twist....

*
American may bid for US Air shuttle Slots at East Coast airports
could be sold by struggling carrier

11:08 PM CST on Thursday, January 8, 2004 By ERIC TORBENSON / The
Dallas Morning News

If US Airways Group Inc.'s East Coast shuttle is up for sale,
American Airlines Inc. could be a likely bidder. "American would make
the most out of the shuttle of any airline," said Ray Neidl, an
analyst who closely follows the airline industry at Blaylock &
Partners, a New York-based investment firm. "It would tie in better
with American's network."

Speculation about the US Airways shuttle grew Thursday following
media reports that the carrier needs to sell its assets to raise
cash. Among the routes that could be sold are shuttle operations
between New York, Boston and Washington, the reports said.

The flights cater to business travelers, considered American's bread-
and-butter market. Increasingly, the world's largest carrier is
finding its crucial East Coast franchise under attack by low-cost
discounters such as JetBlue Airways Corp.

American will always evaluate "opportunities that come up," said
spokesman Roger Frizzell. He wouldn't comment on the carrier's
interest in US Airways' shuttle.

US Airways declined comment Thursday on the reports, which appeared
first in The New York Times and were later confirmed by the Reuters
news service.

The carrier, based in Arlington, Va., emerged from bankruptcy
protection last year but faces an onslaught of discount competition.
In May, Dallas-based Southwest Airlines Co. will start service to
Philadelphia, US Airways' most profitable city.

US Airways spokesman David Castelveter wouldn't say whether its
shuttle operation is profitable.

Fort Worth-based American has sought the shuttle operation before,
bidding $300 million for it in 1997.

But US Airways, which then owned a 47 percent stake in the shuttle,
bought out the entire operation from a consortium of banks.

American won a $10 million fee in the bidding war.

An opportunity to own the shuttle arose again in 2001 when United
Airlines Inc. tried to merge with US Airways. To appease antitrust
regulators, United agreed to sell American partial ownership of the
shuttle service.

That deal fell apart in July 2001, keeping US Airways in the shuttle
business.

The near-hourly flights between the three key business cities have
been profitable in the past, but there's plenty of competition these
days for those fliers.

Delta Air Lines Inc. has its own shuttle operations, and American
parent AMR Corp. began flying regional jets in a shuttle operation in
2002 with its wholly owned American Eagle arm. American officials
have said they're pleased with early results.

Declining business travel and alternatives such as trains or driving
have dented many short-haul business air routes.

Prospects for a deal between American and US Airways will largely
hinge on price, Mr. Neidl said, noting that no carrier is flush with
cash today.

American has improved its cash balance in the last year, and while it
has $3 billion in the bank, it's struggling to pay off $22 billion in
overall debt.

Other airlines would probably bid for the shuttle assets, Mr. Neidl
said, even though "there's more than enough capacity on the shuttle
routes now."

At least one American union likes the idea of a deal with US Airways.

"We would welcome any new flying opportunities," said George Price, a
spokesman for the Association of Professional Flight Attendants,
which has 5,700 members on furlough who would welcome the chance to
come back to work.

The reports Thursday suggested US Airways wouldn't sell aircraft or
employees, but would part with landing slots at congested facilities
such as New York's LaGuardia Airport and Washington's Reagan National
Airport.

American has 28 MD-80s in storage that it's preparing to put back
into service as early as the middle of this year, according to a
planning report the carrier presented to its unions in October.

American plans about 6 percent more capacity to its schedule this
year. Much of that growth will come at its major hubs, Chicago's
O'Hare International Airport and Dallas/Fort Worth International
Airport.

E-mail etorbenson@d...

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