aacun
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Is DL Bidding For AA's Miami Op?

Fri Sep 21, 2012 9:16 pm

Just heard from a pilot Delta is getting ready to put a billion dollar bid for AA's Miami operation. Has anyone else heard anything of this matter?
 
usairways787
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RE: Is DL Bidding For AA's Miami Op?

Fri Sep 21, 2012 9:19 pm

No disrespect to pilots, I usually just dismiss it when pilots talk, they just like us are usually last to know. I haven't heard anything of the sort. It isn't ours to bid for.

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XFSUgimpLB41X
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RE: Is DL Bidding For AA's Miami Op?

Fri Sep 21, 2012 9:35 pm

Just rumors and speculation with little to no substance other than reading between the lines on RA's statements on how he wouldn't mind having that operation.

If it happens, it happens.
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bobnwa
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RE: Is DL Bidding For AA's Miami Op?

Fri Sep 21, 2012 9:38 pm

Quoting aacun (Thread starter):
Just heard from a pilot Delta is getting ready to put a billion dollar bid for AA's Miami operation. Has anyone else heard anything of this matter?

Three days ago we read on Anet That DL was going to aanounce new SEA-China service. The we read that DL and HA were going to merge
Today it is DL buying AA's MIA operation for 1 billion
Not one of those have happened or are likely to happen.
 
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STT757
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RE: Is DL Bidding For AA's Miami Op?

Fri Sep 21, 2012 9:44 pm

You can't buy assets with stock, you need cash.
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FWAERJ
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RE: Is DL Bidding For AA's Miami Op?

Fri Sep 21, 2012 10:21 pm

Quoting STT757 (Reply 4):
You can't buy assets with stock, you need cash.

DL has a big cash warchest. There have been rumors since the new pilot contract was approved that DL is hoarding cash for mergers and acquisitions.

That said, Richard Anderson has stated that the only parts of AA that he is interested in are MIA and DFW, so this might have some validity.
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PIEAvantiP180
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RE: Is DL Bidding For AA's Miami Op?

Fri Sep 21, 2012 10:23 pm

Quoting STT757 (Reply 4):
You can't buy assets with stock, you need cash.

And i believe that any airline interested in MIA ops would need a lot more then 1B $ in cash to buy it. Plus MIA is priceless to AA and i don't believe it for one second they would sell it to anyone especially one of their biggest competitors in DL. Plus DL would need another 150-200 RJ, narrow body, and wide body(25-40) planes to run the MIA ops. Again i just don't see MIA ops and all the necessary aircraft being bought for just 1B$. In my opinion MIA is worth 3-5B$ at lest.
 
jfk777
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RE: Is DL Bidding For AA's Miami Op?

Fri Sep 21, 2012 10:32 pm

AA would surrender O'hare before they sold Miami. DL has a nice franchise to Latin America from Atlanta and JFK, given all that is Miami really that attractive ?
 
avek00
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RE: Is DL Bidding For AA's Miami Op?

Fri Sep 21, 2012 11:04 pm

Quoting aacun (Thread starter):
Just heard from a pilot Delta is getting ready to put a billion dollar bid for AA's Miami operation. Has anyone else heard anything of this matter?

No, and it's highly unlikely, for any number of reasons:

1. With some modest carrier shuffling, MIA has enough spare gate capacity to enable an ambitious US legacy carrier to set up a very respectable focus city operation to Latin America, so there's no need to buy from a competitor what can be gotten with a couple calls to the local airport authority.

2. As others have alluded, a piecemeal purchase is actually more complicated than a wholesale acquisition in bankruptcy. Among other things, as a practical matter, creditors want cold, hard cash when buying a chunk of an operation (as opposed to accepting stock and debt assumptions when the entire franchise is being scooped up). Additionally, the antitrust issues are likely worse in a purchase of a fraction of the company because the transaction would probably be unable to rely upon the "failing firm" exception to antitrust scrutiny that can apply when an acquisition of substantially all of a bankrupt company takes place.

And labor would be a hot mess for the next 20 years.

3. Some of the restricted access market rights are simply non-saleable, and would revert back to DOT for potential allocation to other operators.
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DeltaMD90
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RE: Is DL Bidding For AA's Miami Op?

Fri Sep 21, 2012 11:12 pm

I think the only way AA would do this is if they ceded off everything they own besides DFW. They would have to be truly desperate to do this. They'd probably make more money running only the DFW and MIA hubs than them selling off MIA for a billion dollars.

Then again, we did see Pan Am sell off a lot of their money making assets back in the day. I wasn't there so it might seriously be apples to oranges.

I don't doubt DL would make a move like this, I just doubt AA would agree. The only curve ball I see is if many of the creditors are pissed off at the losses they made with AA and wanted to cut their losses and bail out... but basic economics say it makes more sense to wait it out and let the MIA hub make money
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hiflyer
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 12:16 am

that has been a rumor that has been around for a long time. A nagging theory has been voiced that delta and usair plan to divide amr so that neither has to take the enployees.....that all this has been to stall and delay amr reorg to force a collapse and a subsequent asset purchase. Dunno...but it keeps resurfacing from time to time.
 
BoeingGuy
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 12:18 am

Quoting bobnwa (Reply 3):
Three days ago we read on Anet That DL was going to aanounce new SEA-China service. The we read that DL and HA were going to merge
Today it is DL buying AA's MIA operation for 1 billion
Not one of those have happened or are likely to happen.

Yeah, don't forget when it was reported in the media that US was about to buy out AS. Ooops, just saw Chester flying overhead independently.

Of all of these rumors, the only one I sort of believe is SEA-PVG.
 
deltaflyertoo
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 12:25 am

Quoting DeltaMD90 (Reply 9):
Then again, we did see Pan Am sell off a lot of their money making assets back in the day. I wasn't there so it might seriously be apples to oranges.

The difference was AMR has like over 4 billion in cash, Pan Am had nothing. Each time they went through one of those huge asset deals it was literally to subsidize another few months to a year of operation (in which I guess someone at the top at Pan Am either had huge ego, prayed or whatever but I guess would think it would then turn around in that time)....So seeing AA isn't cash strapped I doubt this too. But as above posters pointed out, they would make a lot more by having just DFW and MIA as it seems the sum of ORD, LAX and JFK are what drags them down.
 
slcdeltarumd11
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 12:31 am

Quoting bobnwa (Reply 3):
Three days ago we read on Anet That DL was going to aanounce new SEA-China service. The we read that DL and HA were going to merge
Today it is DL buying AA's MIA operation for 1 billion
Not one of those have happened or are likely to happen.

If you read this board enough delta has been about to takeover every domestic airline at some point and opening multiple new hubs MIA, SEA, LAX. I would not put too much time on the rumor until we hear something. It would not be the craziest thing ever but it would also have major problems IE the overlap of its own ATL hub. Delta operates to all those same places with ATL and has better feed than MIA.

Quoting avek00 (Reply 8):
3. Some of the restricted access market rights are simply non-saleable, and would revert back to DOT for potential allocation to other operators.

I dont know about that specifically but that could be a major price reduction to a MIA sale and something people on here dont realize.
 
SkyTeamTriStar
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 12:43 am

Until it comes from a News Release from Delta Air Lines, Inc., then its untrue....
 
OB1504
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 1:04 am

Quoting avek00 (Reply 8):
1. With some modest carrier shuffling, MIA has enough spare gate capacity to enable an ambitious US legacy carrier to set up a very respectable focus city operation to Latin America, so there's no need to buy from a competitor what can be gotten with a couple calls to the local airport authority.

Adding to this, DL already tried to build a focus city at MIA just recently, and it didn't last.
 
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yellowtail
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 1:32 am

I actually think this rumor might ha e some truth....DL might just make a run for some AA assets, if only to cost AA and US some money......and to add an air of instability in some of AA's very robust FFers in LatAm. I already see it happening a bit in GUA etc....AA had a lot of pissed off frequent flyers in the 4 destinations I went travelled to week.... POS, BZE, GUA, SAP ...with the delays and cancellations cause by the "industrial action"
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DeltaMD90
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 1:38 am

Quoting slcdeltarumd11 (Reply 13):
It would not be the craziest thing ever but it would also have major problems IE the overlap of its own ATL hub. Delta operates to all those same places with ATL and has better feed than MIA.

Actually I think it would be great... MIA has plenty of O/D and it would help relieve some pressure in ATL.

Quoting yellowtail (Reply 16):

I actually think this rumor might ha e some truth....DL might just make a run for some AA assets, if only to cost AA and US some money.

I foresee it too. I think this rumor is very believable from DL's end, I just don't think AA in their right mind would agree to it.

In AA's weak, present state, still the only way I see this happening is if the creditors get sick of dealing with AA and just want to cut their losses, but even then I think it's unlikely
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 1:48 am

I would think a sale of ORD to US would make more sense for many reasons. US needs a central hub probably more than delta really needs MIA and the sale is better for AA.

They may potentially merge anyway and ORD is a hub with major competion not a fortress hub. MIA. DFW, JFK and LAX would still be able to connect alot of people and serve alot of america.....clearly the network would face some major problems and would loose quite a few elite flyers but they could find a partner to help them maybe even US and get them into one world? I just think selling MIA or DFW is the last thing AA wants to do right now. I bet US would still pay some major cash for ORD it would really enhance their network but i think it would force them to leave star alliance for one world. Who knows? I just dont see them wanting to sell MIA when other things have value. Heck i could see them selling the LGA slots first than MIA
 
AA94
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 2:06 am

Oh, please.

Why would AA sell off Miami? The point of going through bankruptcy is so that you learn to manage your assets better, so that you get benefits out of them in the future. I'm not sure why so many users on this thread are under the impression that AA is just going to sell its entire operation to the highest bidder.

Quoting DeltaMD90 (Reply 9):
I don't doubt DL would make a move like this, I just doubt AA would agree. The only curve ball I see is if many of the creditors are pissed off at the losses they made with AA and wanted to cut their losses and bail out... but basic economics say it makes more sense to wait it out and let the MIA hub make money

  

Quoting FWAERJ (Reply 5):
DL has a big cash warchest. There have been rumors since the new pilot contract was approved that DL is hoarding cash for mergers and acquisitions.

Perhaps, and good for them. But just because DL is willing to pay the money doesn't mean AA is going to take it. I'm not sure why AA would want to fold one of the key parts of their international operation. Anyone who says that AA would make a mover like this isn't thinking logically.
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SCL767
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 2:32 am

Quoting OB1504 (Reply 15):

Quoting avek00 (Reply 8):
1. With some modest carrier shuffling, MIA has enough spare gate capacity to enable an ambitious US legacy carrier to set up a very respectable focus city operation to Latin America, so there's no need to buy from a competitor what can be gotten with a couple calls to the local airport authority.

Adding to this, DL already tried to build a focus city at MIA just recently, and it didn't last.

DL also knows that it would face stiff competition from Latin American airline groups such as AviancaTaca and LATAM. AA's oneworld partner LAN continues to increase frequencies into MIA and plans to launch new routes between South America and MIA next year, i.e. LAN plans to operate non-stop flights between MIA and GIG in January.
 
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 2:40 am

Quoting yellowtail (Reply 16):
I actually think this rumor might ha e some truth....DL might just make a run for some AA assets, if only to cost AA and US some money......and to add an air of instability in some of AA's very robust FFers in LatAm. I already see it happening a bit in GUA etc....AA had a lot of pissed off frequent flyers in the 4 destinations I went travelled to week.... POS, BZE, GUA, SAP ...with the delays and cancellations cause by the "industrial action"


And I think the rumor has absolutely no truth. No BK court would allow the sale of AA's most important/highest yielding hub and then expect them to compete successfully against the other remaining legacy airlines. AA's chances of long term success against the other legacies would decrease dramatically if the hub were sold. The objective of BK is to reorganize and make the company stronger, not weaker.

[Edited 2012-09-21 20:07:11]
 
Bobloblaw
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 2:44 am

Quoting aacun (Thread starter):
Just heard from a pilot Delta is getting ready to put a billion dollar bid for AA's Miami operation. Has anyone else heard anything of this matter?

Sorry, the creditors would never go for that. That would leave AA unviable as an airline going forward thus leaving the creditors well short.
 
codc10
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 3:01 am

AA would effectively be committing the airline equivalent of hari-kari by selling MIA to DL. The have spent the last 10 years strengthening the hub to the point that it is arguably the centerpiece of their operation, and likely the most profitable aspect.

AA is not in desperate need of cash at the moment. This rumor seems like a remnant of the last time DL tried to build up MIA (LHR flights with connectors from several spokes). We heard a lot of chatter regarding the possibility of DL negotiating a purchase of the AA/MIA operation, but it didn't happen then and in my view, it is less likely to happen now.
 
deltal1011man
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 3:42 am

Quoting aacun (Thread starter):

AA isn't in Chap 7....thus they aren't, and wont be, selling assets. I bet the same pilot thinks Delta is going to open Dallas again too  
Quoting STT757 (Reply 4):

......uhh ok.

Quoting jfk777 (Reply 7):
AA would surrender O'hare before they sold Miami. DL has a nice franchise to Latin America from Atlanta and JFK, given all that is Miami really that attractive ?
Quoting slcdeltarumd11 (Reply 13):
It would not be the craziest thing ever but it would also have major problems IE the overlap of its own ATL hub. Delta operates to all those same places with ATL and has better feed than MIA.

You guys are kidding right? Your not even remotely comparing Atlanta with Miami to Latin/South America?

I can't think of a market that MIA isn't its largest O/D destination by far. (and I can't think of really any that Atlanta is in the top 5)

Oh and AA has a much larger year round network to Latin/South America from MIA than DL does from Atlanta. A good chunk of Delta's network is summer seasonal (or it goes from daily to 1x a week)
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qqflyboy
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 4:16 am

What hub did DL (or CO, US, NW, UA) sell to another carrier during their bankruptcy to survive? Oh, that's right, they didn't. The economics of the airlines are vastly different in deregulation, and the asset sales we saw in the 70s and 80s just won't happen again, unless an airline is truly faltering and about to go under (TWA). AA is reorganizing in bankruptcy, just like United, US Airways, Continental, Delta and Northwest. None of those carriers performed major asset sales during their Ch. 11. Yes, we may see some hubs/focus cities shrink, but that's not an asset sale. AA has the exclusive right to organize without outside input through the end of the year. They will undoubtedly have their plan in place by then, or seek another extension if not (which is guaranteed to be granted).

AA has outperformed the entire industry for the past four months in RASM. That shows in spades how much the company has improved their operating costs -- and that was *before* the new labor agreements were in place. The new work rules allowing improved efficiency and productivity and lower costs won't begin taking effect until October, and it will take at least a year to implement all the changes. It means AA's costs will only continue to shrink.

On another note about AA, their entire bankruptcy is entirely self funded. Meaning they didn't have to secure DIP (debtor-in-possession) financing, and they won't have to secure exit financing either. That's because of their strong cash position, meaning they wouldn't need to perform any asset sales. DL can entertain the idea all they want, and even present it to the court, but AA is under no obligation to even contemplate the offer. And I'm pretty sure DL knows exactly how that'd go down, and highly doubt they're willing to endure that failure in the public eye -- meaning they won't attempt it. They may dream about it, but like many things, it's a pipe dream.
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STT757
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 10:58 am

Quoting qqflyboy (Reply 25):
What hub did DL (or CO, US, NW, UA) sell to another carrier during their bankruptcy to survive?



CO sold their LGA assets, which they bought in Eastern's CH-7 liquidation, to US Air. That included their slots and a lease to US Air for the new Terminal CO was building at LGA. Also CO sold their MIA-London rights, which they acquired from Eastern when Texas Air took over Eastern, to AA when AA bought Eastern's MIA/Latin America operation. CO also sold AA their SEA-NRT flight.

And while not an asset sale CO did shut down their DEN hub and move those assets to beefing up EWR and IAH, they did the same with their HNL hub. They moved all those DC-10s and 747s operating Australia, New Zealand, the Philippines, Japan etc.. from HNL to EWR to begin expanding their Trans-Atlantic network from EWR.

So there are instances where a carrier has shrunk, and in the long run it worked out for them. With AA MIA would not be the place to shrink, that would be ORD (IMO).
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crAAzy
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 12:00 pm

Yeah .... I heard the rumor was that DL was going to trade its NYC hub for AA's MIA hub... LOL.

Does that make any sense? No! This is completely ridiculous from both a strategic position for AA and the "rumored" cost. AA giving up its second most important by i like saying DL is going to give up NYC ... It's only going to happen if the airline is completely liquidated and even then $1 billion dollars is like saying your only going to pay $5000 for a brand new BMW 5 series
 
jfk777
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 12:11 pm

Quoting Deltal1011man (Reply 24):
You guys are kidding right? Your not even remotely comparing Atlanta with Miami to Latin/South America?

I can't think of a market that MIA isn't its largest O/D destination by far. (and I can't think of really any that Atlanta is in the top 5)

Oh and AA has a much larger year round network to Latin/South America from MIA than DL does from Atlanta. A good chunk of Delta's network is summer seasonal (or it goes from daily to 1x a week)

No one is saying "Atlanta is bigger then Miami", we all know MIA is the Latin America king. But Delta does have a decent sized Latin opertation in Atlanta. Hey they have the only flight by a US airline to Johannesberg from where ? Atlanta, that huge hub you sell tickets to any city in the world.
 
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 12:28 pm

Quoting jfk777 (Reply 28):
Hey they have the only flight by a US airline to Johannesberg from where ? Atlanta, that huge hub you sell tickets to any city in the world.

Really? Jeesh man, your teaching me about aircraft MX and the city of Atlanta. Hey maybe you should teach me about The University of Georgia and an A&P license.....that would pretty much cover my life  
Quoting jfk777 (Reply 28):

No one is saying "Atlanta is bigger then Miami", we all know MIA is the Latin America king. But Delta does have a decent sized Latin opertation in Atlanta.

Yes but its not even comparable to what Delta could/would have at MIA if they were to have AA hub. As i said, Delta's network is very seasonal and has a hard time(impossible) serving smaller markets because MIA is the top market by far.
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WA707atMSP
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 3:27 pm

Quoting aacun (Thread starter):
Just heard from a pilot Delta is getting ready to put a billion dollar bid for AA's Miami operation. Has anyone else heard anything of this matter?

Another pilot has heard a rumor that when he is on a trip, Selena Gomez will give him the key to her hotel room, and will say "come up to my room if you want to have some fun tonight!"

Some rumors have a viable chance of coming true. Others are pure fantasy. All of us need to recognize the difference.

There is no doubt that DL management has fantasized of adding AA's MIA operations to DL's collection of hubs - the result would be an unbeatable airline. I'm sure DL has also thought about buying AA's terminal at JFK, which would be a quick solution to DL's facilities problems there, and possibly even AA's facilities at LAX, which would give DL enough gates to become the dominant airline in Los Angeles.

I'm also sure that United, Southwest, JetBlue, and every other airline in the US has done studies of what assets owned by American they would like to purchase, if there is an opportunity.

However, Miami is the crown jewel of AA's network, and without MIA, the rest of the airline would be unable to survive. DL can daydream all they want about taking over AA's facilities at MIA, but the only way AA, or their creditors, would sell them is if the airline was liquidated.

Quoting STT757 (Reply 26):
CO sold their LGA assets, which they bought in Eastern's CH-7 liquidation, to US Air. That included their slots and a lease to US Air for the new Terminal CO was building at LGA. Also CO sold their MIA-London rights, which they acquired from Eastern when Texas Air took over Eastern, to AA when AA bought Eastern's MIA/Latin America operation. CO also sold AA their SEA-NRT flight.

True, but these were not the most vital parts of CO's network. AA selling their MIA hub would be the equivalent of CO selling either their IAH or EWR hubs, which did not happen.
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STT757
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 3:34 pm

Quoting WA707atMSP (Reply 30):
True, but these were not the most vital parts of CO's network. AA selling their MIA hub would be the equivalent of CO selling either their IAH or EWR hubs, which did not happen.

I agree, that's why I mentioned ORD which is of lesser importance to AA than DFW and MIA.
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WA707atMSP
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 3:56 pm

Quoting STT757 (Reply 31):
Quoting WA707atMSP (Reply 30):
True, but these were not the most vital parts of CO's network. AA selling their MIA hub would be the equivalent of CO selling either their IAH or EWR hubs, which did not happen.

I agree, that's why I mentioned ORD which is of lesser importance to AA than DFW and MIA.

My apologies - you are correct. I did not read the last line of your message before I made my post. It's been a long week 
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slcdeltarumd11
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 4:21 pm

Quoting Deltal1011man (Reply 29):
Quoting jfk777 (Reply 28):

No one is saying "Atlanta is bigger then Miami", we all know MIA is the Latin America king. But Delta does have a decent sized Latin opertation in Atlanta.

Yes but its not even comparable to what Delta could/would have at MIA if they were to have AA hub. As i said, Delta's network is very seasonal and has a hard time(impossible) serving smaller markets because MIA is the top market by far.

BUT no one said it wasnt larger no one mentioned size of flights to south america or o&d but you.

The point is how would Delta deal with duel hubs feeding the same areas? What major market does AA serve from MIA that Delta doesnt?

Delta wants to be as profitable as posible not move as many people as possible. ATL has more feed than MIA for connecting passengers and business people. AA wishes it had the feed at MIA that Delta has at ATL. Two hubs to feed the same area would be inefficient and unrealistic in 2012. There would be too much redundancy from ATL/MIA to the carribean, south america, and central america it would not be the most cost effective. I cant see Delta making ATL cuts just so they can buy MIA? MIA is so profitable because AA conntects so many people o&d alone isnt worth it? Delta could set up an operation in MIA there is gate space and no slot problems, and the route authorities AA has apparently wont transfer and go back to the DOT anyway.

By the way have you seen a route map? Deltas operation to the carribean and central america is pretty extensive from ATL. Its not like DL does not have lots of flights to those same major markets. Two hubs would be inefficient and have you forgotten that people on here report that DL would loose access to its most profitable MIA markets in Brazil if this went thru and it would roll back to the DOT? Delta would not be instantally taking over AAs MIA operation when some of its gems in South America would go back to the DOT
 
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DeltaMD90
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 4:55 pm

Quoting slcdeltarumd11 (Reply 33):
The point is how would Delta deal with duel hubs feeding the same areas?

It would be like ATL and JFK to Europe. MIA *is* the hub to Latin America. DL would be just fine feeding passengers to MIA. They wouldn't eliminate all ATL-Latin America flying... they'd keep the few routes where it's more convenient to fly out of / through ATL.

AA isn't #1 to Latin America for some unknown reason... it's MIA
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questions
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 5:50 pm

Quoting EricR (Reply 21):
No BK court would allow the sale of AA's most important/highest yielding hub

This is not to challenge the poster, EricR, but a question for the group. Is there any publicly available data to back this up? To what degree, eg, percentage of revenue and net income, does MIA contribute to AA's financial performance?

When considering current market share and growth opportunity, is LATAM or Asia a better play for DL?
 
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 6:01 pm

Quoting DeltaMD90 (Reply 34):
It would be like ATL and JFK to Europe. MIA *is* the hub to Latin America. DL would be just fine feeding passengers to MIA. They wouldn't eliminate all ATL-Latin America flying... they'd keep the few routes where it's more convenient to fly out of / through ATL.

AA isn't #1 to Latin America for some unknown reason... it's MIA

But Delta would be forced to return AAs super profitable authorities back to the DOT(as reported here). MIA has tons of gates and space Delta is free to start flying right now if MIA is so hot and its mostly for o&d. They have ATL and its free i dont see them really wanting to pay enough money to get this from AA anyway plus ATL has all those cities covered plus there would be no increased efficiency.
 
EricR
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 6:39 pm

Quoting questions (Reply 35):
This is not to challenge the poster, EricR, but a question for the group. Is there any publicly available data to back this up? To what degree, eg, percentage of revenue and net income, does MIA contribute to AA's financial performance?


Perhaps I should clarify. While it is theoretically possible, it does not seem reasonable nor likely that they would permit it.
 
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DeltaMD90
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 8:16 pm

Quoting slcdeltarumd11 (Reply 36):
MIA has tons of gates and space Delta is free to start flying right now if MIA is so hot and its mostly for o&d.

It's not that easy. Hubs just don't pop out of nowhere. AA @ MIA has the loyalty, FFs, recognition, coveted routes, a long history, the feed, Latin American partners, etc. What would DL have? They tried it recently and it hasn't done so well. They had little feed, lacked many of the good route authorities, little FFs there, etc. Plus you can bet that anything DL tries to pull AA is going to respond
Ironically I have never flown a Delta MD-90 :)
 
TWACaptain
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 9:08 pm

Real simple...it ain't gonna happen. With the three unions on the Creditor's Committee, along with the likelihood that Airbus and Boeing would side with the unions it this case, a breakup of the AA operation under Chapter 13 isn't an option. The unions would not want a break up because no jobs would in any likelihood go with any portion, especially for the majority of employees. Airbus and Boeing would not want to lose 465 new aircraft orders as Delta's management have publicly stated they have no interest in purchasing new aircraft anytime soon (as seen with the recent 717 and MD-90 acquisitions).

If Delta want's AA's MIA and DFW operations they're going to have to take all of AA to get them. Considering the size of the combined company, the anti-trust regulations wouldn't allow it.
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AA94
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 9:20 pm

Quoting questions (Reply 35):
This is not to challenge the poster, EricR, but a question for the group. Is there any publicly available data to back this up? To what degree, eg, percentage of revenue and net income, does MIA contribute to AA's financial performance?

A large percent. I can't quote exact numbers, but MIA is a cornerstone of AA's operations. Giving it up is basically a death sentence.
If you can't take the heat, you best get out of the kitchen
 
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yellowtail
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 9:30 pm

Only one person probably knows for sure what DL might /might not do....Richard......lets call him and ask him. 
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MAV88
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 9:54 pm

Quoting DeltaMD90 (Reply 34):
Quoting slcdeltarumd11 (Reply 33):
The point is how would Delta deal with duel hubs feeding the same areas?

It would be like ATL and JFK to Europe. MIA *is* the hub to Latin America. DL would be just fine feeding passengers to MIA. They wouldn't eliminate all ATL-Latin America flying... they'd keep the few routes where it's more convenient to fly out of / through ATL.

AA isn't #1 to Latin America for some unknown reason... it's MIA

DL is not going to come into MIA and setup a large operation. If they really wanted to, they would have already done it. It's hasn't been a secret that MIA is the largest market to Latin America. Besides, I doubt MIA could handle another carrier coming in an setting up shop with say over 50 flights a day down to Latin America. AA and their partners have the entire market on lock.
 
LAXtoATL
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 11:08 pm

1. While unlikely to pull it off, Delta senior management desperately wants to get their hands on MIA!
You can believe just about any rumor that they are attempting, because they are discussing all kinds of scenarios that would allow them to get AA's MIA operation. Whether they can actually succeed is another matter.

2. The creditors committe is much more interested in recouping their capital than AA's long term survival, so a large sum of cash now would be more attractive to them than assets that could generate a return years down the road. Remember AA management is not in control during bankruptcy, the creditors ultimately are steering this process.
 
slcdeltarumd11
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 11:18 pm

Quoting DeltaMD90 (Reply 38):
It's not that easy. Hubs just don't pop out of nowhere. AA @ MIA has the loyalty, FFs, recognition, coveted routes, a long history, the feed, Latin American partners, etc. What would DL have? They tried it recently and it hasn't done so well. They had little feed, lacked many of the good route authorities, little FFs there, etc. Plus you can bet that anything DL tries to pull AA is going to respond

Well i personally think if they sell any hub it will be ORD to USairways and i said that much earlier in this thread. I dont think Delta will buy or be able to buy MIA, i was just making a point MIA has room for Delta is O&D was so rich and available and they have the planes they could start flying many flights instantally.
 
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CV880
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 11:26 pm

Quoting LAXtoATL (Reply 43):
Delta senior management desperately wants to get their hands on MIA!

DL & EA were kings in South Florida before AA ever had a presence there. EA folded and DL gave it up except for Florida-NYC. IIRC, DL had the opportunity to get the international routes from MIA that PA had, but let them go. DL would be insane to "purchase" what they gave up long ago. Same can be said for the ORD market where DL never attempted CHI-LAX/SFO after regulation ended in the late 70's, and also gave up CHI-Florida to both AA & UA.
 
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yellowtail
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RE: Is DL Bidding For AA's Miami Op?

Sat Sep 22, 2012 11:54 pm

Quoting MAV88 (Reply 42):
DL is not going to come into MIA and setup a large operation. If they really wanted to, they would have already done it. It's hasn't been a secret that MIA is the largest market to Latin America. Besides, I doubt MIA could handle another carrier coming in an setting up shop with say over 50 flights a day down to Latin America. AA and their partners have the entire market on lock.

Things change and will always continue to change. IMHO many in this forum will eat their words on this thread by the end of 2014. MIA will look very different in 24 months.

Quoting LAXtoATL (Reply 43):
1. While unlikely to pull it off, Delta senior management desperately wants to get their hands on MIA!
You can believe just about any rumor that they are attempting, because they are discussing all kinds of scenarios that would allow them to get AA's MIA operation. Whether they can actually succeed is another matter.

  

Don't forget their are some AA and CO (LatAm) people at DL now....people who know Latin American markets...like Cortelayu
When in doubt, hold on to your altitude. No-one has ever collided with the sky.
 
2travel2know2
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RE: Is DL Bidding For AA's Miami Op?

Sun Sep 23, 2012 12:54 am

Quoting yellowtail (Reply 46):
Things change and will always continue to change. IMHO many in this forum will eat their words on this thread by the end of 2014. MIA will look very different in 24 months.

It'd not come as a surprise if DL is to open selected Latin American and Caribbean routes out of MIA in the near future.
Several markets might sustain AA plus another U.S. airline on the MIA route and DL flights from both ATL (or JFK) and MIA.
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DeltaMD90
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RE: Is DL Bidding For AA's Miami Op?

Sun Sep 23, 2012 1:03 am

Quoting LAXtoATL (Reply 43):
1. While unlikely to pull it off, Delta senior management desperately wants to get their hands on MIA!
You can believe just about any rumor that they are attempting, because they are discussing all kinds of scenarios that would allow them to get AA's MIA operation. Whether they can actually succeed is another matter.

Um what has Delta's management desperately attempted? What actual actions (not rumors like this one) has Delta attempted?? The only thing I can think of involving DL and MIA are the random MIA-LAX flights (which I think is mainly for their LAX operation) and the MIA-LHR + the small inter-FL feed to MIA (none of which focused on Latin America.)

Your response makes it sound like DL has tried 30 plans to get MIA and failed. This is just a RUMOR! There might not be a shred of truth. I think they'd buy MIA if they could but it's not their #1 goal in life.

It's like the posters that say "DL is trying to buy everyone and everything" because of a RUMOR that DL was gonna buy AS, a RUMOR DL was gonna buy AA, a RUMOR DL is gonna buy HA, a RUMOR DL is going to buy MIA, a RUMOR DL is gonna buy B6, etc. See a common theme?

If DL's management is "desperate" to get MIA, then it's a well hidden desperation because they haven't publicly shown it
Ironically I have never flown a Delta MD-90 :)
 
LAXtoATL
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RE: Is DL Bidding For AA's Miami Op?

Sun Sep 23, 2012 1:22 am

Quoting DeltaMD90 (Reply 48):

I'm just telling what I know.
I haven't seen anything public (with the exception of them hiring consultants to go over the various scenarios), but I can tell u for a fact that there are a lot of discussions going on and true desire to get ahold of AA's MIA operation. It is not rumor, I know from a senior exec. And it's not a secret within the industry. Like I said a realist would put there chances of success at less than promising, but they are interested and not just a passing interest.
I believe some play will made for MIA before AA exits bankruptcy, they looked for the most opportune time and strategy.
Now what that is I don't know, and I doubt they know at this point.

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