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TWA772LR
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TWA And HP Merger?

Sat Nov 26, 2011 7:26 am

I saw on wiki (not the best, I know) that TWA started code-sharing with America West in the 1990's that could've led to a merger. I have some questions like:
What would be the combined airlines name?
Would they be around today?
What would the industry look like today if this merger happened?

Link:
http://en.wikipedia.org/wiki/Trans_World_Airlines
(under "short turn-around" section)

Sorry if this has been posted before.
And for my next miracle, I'm gonna turn water into funk!
 
HPRamper
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RE: TWA And HP Merger?

Sat Nov 26, 2011 7:34 am

The TWA name most certainly would have been kept, and the combined airline would doubtless have gone the way of the dodo even after an HP merger. HP at the time was still quite small and wouldn't have added much to TWA other than PHX and LAS...hubs in low-yield markets.
 
Italianflyer
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Joined: Sun Nov 11, 2007 3:06 pm

RE: TWA And HP Merger?

Sat Nov 26, 2011 3:30 pm

I agree with HPRamper....a combined TW/HP would have been a mess. At the time, 1998, HP had some serious operational and financial issues....so serious that the FAA was watching them like a hawk. TW was hamstrung by the Caribou deal and tweeking the network around a STL fortress and trying to salvage JFK.
 
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OzarkD9S
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RE: TWA And HP Merger?

Sat Nov 26, 2011 4:05 pm

Actually, the code-share was never implemented. It was planned, but TWA was running out of cash and AA came calling before the alliance went into effect.

While both carriers were having problems at the time, the network of the two were very complementary. Another one of those "what-if" scenarios.
Next up: STL-CVG-MKE-MSP-STL.
 
ABQopsHP
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RE: TWA And HP Merger?

Sat Nov 26, 2011 5:30 pm

Quoting OzarkD9S (Reply 3):
the network of the two were very complementary. Another one of those "what-if" scenarios.

While the route networks of both carriers was complementary, there was not much else about the two companies that were similar. However HP looked at adopting some of the customer processing procedures of TW. Such as purchased upgrades to F-class day of departure, with the rate based on length of segment. In ABQ the TW gate was down the hall from HP and I could hear them making announcements for anyone who would like to purchase and upgrade to STL for $XX amount.
However hindsight 20/20 being what it is, AA likely saved HP from itself had a merger gone through. HP had serious operational problems during that period, and TW was burning through its $$$ fast. Its hard to say what could have happened had it gone through. One question I have in the "what if" arena, is. Would the combined company been able to shrink the size of STL to cause the Caribou deal to not have such a major impact on the operation? Or was Caribou a system wide thing that TW would not have been able to get around?
I like the fantasy of thinking TW would still be around. But alas they are not and same with HP. With things going the way they are at US, there wont be much evidence left of HP in the future too.

JD CRP
ABQ ops, Cactus 202 requesting you order 5 Green Chile Chicken stew for us to p/u on arrival. ;)
 
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OzarkD9S
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RE: TWA And HP Merger?

Sat Nov 26, 2011 6:46 pm

Quoting ABQopsHP (Reply 4):


Would the combined company been able to shrink the size of STL to cause the Caribou deal to not have such a major impact on the operation? Or was Caribou a system wide thing that TW would not have been able to get around?

The Karabu arrangement did not include tickets that originated or terminated in STL. Nor were code-share tickets included. Therefore it was conceivable that HP/TWA could have code-shared until the Karabu deal expired, then possibly a full merger later. As originally conceived, it was merely an alliance, no merger was contemplated at the time.
Next up: STL-CVG-MKE-MSP-STL.
 
iflyCA
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RE: TWA And HP Merger?

Sat Nov 26, 2011 9:14 pm

I'm sorry but what is the Carabou/Karabu deal?
 
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OzarkD9S
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RE: TWA And HP Merger?

Sat Nov 26, 2011 10:12 pm

Quoting iflyCA (Reply 6):


I'm sorry but what is the Carabou/Karabu deal?

It was an arrangement between TWA and Carl Icahn that allowed Icahn to buy bulk tickets on TWA at a discount and resell to the public while pocketing the difference. THE major noose around TWA's financial neck in the late 90's, virtually assuring TWA could never turn a profit until the contract expired.

Full details:

http://contracts.onecle.com/lowestfare/twa-ticket-1995-06-14.shtml
Next up: STL-CVG-MKE-MSP-STL.
 
CWAFlyer
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Joined: Tue Mar 15, 2005 3:33 am

RE: TWA And HP Merger?

Sat Nov 26, 2011 11:39 pm

This was why TWA started focus cities in LAX and SJU, with moderate success. They also tried doing non-stops between non-hub/focus cities in the mid to late 90's such as LAS-MCI, MCI-JFK and started using slots they had and running flights again from MCI to LGA and MCI to DCA.
 
Thrust
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Joined: Wed Sep 17, 2003 12:17 pm

RE: TWA And HP Merger?

Sun Nov 27, 2011 2:02 am

IMO, there was really nothing that anybody could have done to save TWA once Icahn gained the reins. He systematically sold the airline off piece by piece...even with the addition of America West it would have breathed little life into the airline I think. The final nail in the coffin came when Icahn forced them to agree to the Karibu agreement. 2003 would have been the year TWA was relieved of the obligation, but a buyout by another airline was their only alternative to liquidation by 2001. TWA was plagued by an extremely old fleet that they failed to modernize until the very last minute...Icahn, who had no interest in helping the airline grow domestically or internationally, and a hub within basically one city at the very end, which was not big enough to support all of TWA's operations there.
Fly one thing; Fly it well
 
ckfred
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Joined: Wed Apr 25, 2001 12:50 pm

RE: TWA And HP Merger?

Sun Nov 27, 2011 7:09 am

Quoting Thrust (Reply 9):
IMO, there was really nothing that anybody could have done to save TWA once Icahn gained the reins. He systematically sold the airline off piece by piece...even with the addition of America West it would have breathed little life into the airline I think. The final nail in the coffin came when Icahn forced them to agree to the Karibu agreement. 2003 would have been the year TWA was relieved of the obligation, but a buyout by another airline was their only alternative to liquidation by 2001. TWA was plagued by an extremely old fleet that they failed to modernize until the very last minute...Icahn, who had no interest in helping the airline grow domestically or internationally, and a hub within basically one city at the very end, which was not big enough to support all of TWA's operations there.

Icahn liked to buy up stock in a company, threaten to gain control of the company, wait for the white knight to outbid him, and then sell making a nice profit.

The problem with TWA was that no one came along to "save" TWA from Icahn. So, Icahn got stuck buying the company. Icahn may be very smart, when it comes to determining if a company is valued properly by the market, but he had no prior experience at running a company. That lack of experience reared it ugly head during Icahn's tenure as CEO.

Despite managers telling Icahn that TWA needed to renew the fleet, he wouldn't put in any orders during the 1980s. He simply couldn't understand that while aircraft cost millions of dollars, TWA would save a lot on fuel and maintenance, and that new aircraft reduce delays and cancellations due to aircraft going tech.

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