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jetpixx
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Would CO/DL Merger Make Any Sense?

Fri Apr 14, 2006 5:18 am

I know that the two airlines visited this a while back - (1999 or so I think?) - and NW worked hard against this. Would it not make sense for these two airlines to get together - since their hubs are distanced fairly far apart (with the exception of CLE/CVG, EWR/JFK)? The fleet types are generally the same with a few exceptions which are soon to be retired.

Also, why did NW work so hard against this - I heard that a lot of animosity exists between DL and NW - so why are they working together on SkyTeam?

[Edited 2006-04-13 22:20:15]
 
UAXDXer
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RE: Would CO/DL Merger Make Any Sense?

Fri Apr 14, 2006 5:29 am

Why would Continental want to go and ruin a good thing by merging with Delta? I do see Continental buying a lot of Delta assets should something happen though.
It takes a bug to hit a windsheild but it takes guts to stick
 
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1337Delta764
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RE: Would CO/DL Merger Make Any Sense?

Fri Apr 14, 2006 5:31 am

Quoting UAXDXer (Reply 1):
Why would Continental want to go and ruin a good thing by merging with Delta? I do see Continental buying a lot of Delta assets should something happen though.

A Delta/Continental merger would be FAR BETTER than a Delta/Northwest merger. The fleets are similar.

How would a merger of two bankrupt airlines survive?
The Pink Delta 767-400ER - The most beautiful aircraft in the sky
 
positiverate
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RE: Would CO/DL Merger Make Any Sense?

Fri Apr 14, 2006 5:35 am

Quoting Jetpixx (Thread starter):
Would it not make sense for these two airlines to get together - since their hubs are distanced fairly far apart (with the exception of CLE/CVG, EWR/JFK)?

It probably would. Try doing a search on this, I think it's been discussed many times before.
 
dutchjet
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RE: Would CO/DL Merger Make Any Sense?

Fri Apr 14, 2006 5:53 am

A DL/CO combination was rumored for years - in good times and in bad times - as the route systems of both carriers would work well together. The story went that NYC ops could be consolidated at EWR, the CO CLE hub would be losed down in favor of the DL CVG hub, ATL would of course remain and expand, DL's DFW hub (DFW was still a DL hub when these rumors were hot) would be closed down in favor of IAH, and SLC would continue to be the western hub of the system. Aircraft are a good (but not great fit) - while both CO and DL fly 737s, 757s, 767s, and 777s, engines differ on the 757s, some 767s (DL has a mixed PW/GE fleet) and the 777s......and CO has all of those 2nd generation 737s while DL is a big MD80 operator (as well as the MD90). But there are serious problems when it comes to finances (CO is in reasonable shape financially and has actually shown a profit here and there in the past years while DL is stuck in bankruptcy), both airlines have an awful lot of debt,and then there are the employees and intergration to think about (CO in recent years has been a much happier place to work at than DL).

When the DL + CO merger was good gossip (back before things got so difficult over at DL).......for various reasons, CO would be the surviving carrier although it would be absorbing a far bigger airline.

It never happened, and probably never will - CO seems content in growing on its own and continue to expands.

Then, of course, there are the CO + UA rumors -again, unlikely to happen.
 
IcelandairMSP
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RE: Would CO/DL Merger Make Any Sense?

Fri Apr 14, 2006 6:14 am

It would be a landmark if they could get this through antitrust court. It would produce one very large airline with very significant shares of various markets--particularly the south and across the Atlantic. US/HP merger went through with relatively little trouble in being stuck with antitrust in that their hubs markets were very different and complimentary. A DL/CO merger would only give increased access to many markets they already have a sizeable share in.

Even so, bankrupcy and what has appeared to be largely unsuccesful restructuring has made DL look even worse. Taking over the airline would mean consolidating the already disillusioned unions of DL and, unless DL was in liquidation and CO could basically dicatate a lot of the terms of an employee consolidation, working that through would be an absolute, utter nightmare. CO has been through bankrupcy enough to know that employees make things very difficult--not in the sense that they're hellraisers, but in the sense that they are people with needs and can't be as easily disposed of, rearranged, or reformed as other areas of operation can.

I think a lot of people on a.net think a CO/DL merger would be great because of their compatible fleets creating a super fleet of Boeing aircraft for the ages to remember and would give them the opportunity to order more super fleets of Boeings. They would also have the grandest, most comprehensive network across the Atlantic ever envisioned for route map enthusiasts and a merger would probably mean more expansion and consolidation, etc. But as a rule, the bigger the merger, the more difficult it is to sort through. A DL/CO would be enormous with one side exasperated from painful bankrupcy procedures and the other one a multiple-time survivor of bankrupcy that isn't on incredibly sturdy ground either. It just wouldn't be as viable as is hoped.
 
ikramerica
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RE: Would CO/DL Merger Make Any Sense?

Fri Apr 14, 2006 6:20 am

CO has no reason to want this. They'd be far better off taking DL assets and route authorities than absorbing all of DLs domestic structure.

Should DL fail, and we don't have evidence that will happen, ATL would become like JFK or LAX, where multiple airlines would have large operations there but it would no longer be a superhub like it is now.
Of all the things to worry about... the Wookie has no pants.
 
sac
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RE: Would CO/DL Merger Make Any Sense?

Fri Apr 14, 2006 7:13 am

From what I can remember when all this went down, DL wanted something more than a merger. One thing that killed the deal was placing all the CO employees at the bottom of the DL sonority list. With NW, they got a large share of class A stock and seats on the board, along with access to the CO route system with a long-term code share agreement, with out the mess of a merger. This arrangement was changed in 2001 when CO repurchased the stock back from NW. The code share deal was extended to something like 25 years and NW was given first rights of refusal when it come to another merging with CO.
 
flydreamliner
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RE: Would CO/DL Merger Make Any Sense?

Fri Apr 14, 2006 7:17 am

I think CO is happy with their long list of strategic partnerships. They have an integrated codeshare with NW, as well as a number of other foreign airlines. CO seems to have the healthiest business at the moment of any of the American big 4 legacy carriers.
"Let the world change you, and you can change the world"
 
CO767FA
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RE: Would CO/DL Merger Make Any Sense?

Fri Apr 14, 2006 7:28 am

Quoting Sac (Reply 7):
... it come to another merging with CO.

Let's get this straight....If CO is the acquirer, NW has no say in the matter. If CO is being acquired, NW has first right of refusal.
 
aircanada014
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RE: Would CO/DL Merger Make Any Sense?

Fri Apr 14, 2006 7:28 am

I wouldn't merge a good profit airline with a bankruptcy airline.. DL and CO no way. I agree CO buying DL's assests.
 
UAL#1fan
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RE: Would CO/DL Merger Make Any Sense?

Fri Apr 14, 2006 10:34 am

CO would never get Delta's trans-Atlantic assets if Delta failed. The government would never allow it on antitrust violations, since Continental would then pretty much control the New York-Europe market. If anything, the trans-Atlantic DL routes would go to an airline with a modest presence in Europe by comparison like UA or NW, to add balance.

CO could get the Latin American routes, though.

The whole problem with Delta and CO merging is while their fleets might complement each other, their route structures parallel each other too much, with the exception of the western US.
United Air Lines -Mainliners Coast to Coast
 
masseybrown
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RE: Would CO/DL Merger Make Any Sense?

Fri Apr 14, 2006 11:44 am

Quoting UAL#1Fan (Reply 11):
CO could get the Latin American routes, though.

I'm not sure CO would want many of DA's Latin routes without the ATL hub to fill them up.

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