Republic
Topic Author
Posts: 541
Joined: Thu Dec 27, 2012 12:39 am

CO Offers TWA Cash To Stay Alive

Wed Jan 24, 2001 9:58 pm

Hi,

CO offers to pay $400 million to TWA for certain assets. This would allow TWA to stay independent, join CO in an alliance, and keep flying. Read the story: http://www.chron.com/cs/CDA/story.hts/front/804692

Rgds,

Joe
 
Das Flugzeug
Posts: 156
Joined: Tue Nov 09, 1999 1:17 pm

RE: CO Offers TWA Cash To Stay Alive

Wed Jan 24, 2001 10:18 pm

This would be awesome! Competition would be preserved, Continental could expand, and TWA could stay alive.
 
flashmeister
Posts: 2671
Joined: Fri Apr 28, 2000 4:32 am

RE: CO Offers TWA Cash To Stay Alive

Wed Jan 24, 2001 10:23 pm

Wow... I'd bet that Carty is not pleased...

In the end, if there's a bidding war, I have little doubt that AMR will win, but at least CO can make it a lot more expensive for them.
 
akelley728
Posts: 1964
Joined: Tue Dec 07, 1999 12:35 pm

RE: CO Offers TWA Cash To Stay Alive

Wed Jan 24, 2001 11:13 pm

YES!

Go Continental! I hope it happens!
 
Guest

RE: CO Offers TWA Cash To Stay Alive

Wed Jan 24, 2001 11:15 pm

I wonder what CO wants with TW's JFK slots? Maybe a regional jet operation to compliment EWR hub and the new RJ operation at LGA? In this way, CO could realy cement its position as NY's #1 airline.

Let's see.
 
Tool
Posts: 59
Joined: Fri Mar 25, 2016 9:20 am

RE: CO Offers TWA Cash To Stay Alive

Wed Jan 24, 2001 11:22 pm

Go Continental. I hope that this goes through.
 
Tan Flyr
Posts: 1558
Joined: Sat Aug 19, 2000 11:07 pm

RE: CO Offers TWA Cash To Stay Alive

Wed Jan 24, 2001 11:25 pm

This could also cause TWA to be chopped up like a chicken..a leg here(gates), a breast there(slots)..and fights over the wings(planes). While an offer from CO or even NW DL for this asset or that might bring a few more dollars for the bond holders it does nothing for the employees. At least AA promised the court that the TWA employees would have jobs.

Better to think the implications of these offers before jumping for joy.
 
Guest

RE: CO Offers TWA Cash To Stay Alive

Wed Jan 24, 2001 11:27 pm

This will never be accepted by the court, as it doesn't really provide for the long term viability of TWA. CO is going to strip TWA of its most valuable assets, and deploy the airline as a smaller, weaker little codeshare partner. It will be bankrupt again in a matter of a couple years. It sounds generous, but it's really pretty evil. This is precisely what happened to Pan Am before it went down. Other airlines stripped it of its most valuable assets, and what do you know? It died.
 
MEA-707
Posts: 3661
Joined: Mon Nov 15, 1999 4:51 am

RE: CO Offers TWA Cash To Stay Alive

Wed Jan 24, 2001 11:28 pm

A RJ slot to feed LGA and EWR at JFK??? Wow, imagine they will fly JFK-LGA or JFK-EWR twice an hour for $29 or so for the 10 minute flight. I'm sure many people who want to change over without spending hours in public transport, gather FF-miles or just for the fun of flying over NYC area will sure fill these planes up.
nobody has ever died from hard work, but why take the risk?
 
wolfpacker
Posts: 343
Joined: Tue Jun 29, 1999 2:35 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 12:29 am

Wouldn't the $75million breakup fee weigh into the courts decision?
 
Das Flugzeug
Posts: 156
Joined: Tue Nov 09, 1999 1:17 pm

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 12:35 am

I read that TWA doesn't even use some of the slots that CO wants. By code sharing with CO, TWA could fill its planes more easily, and offer a wider network to its customers, therebye increasing its ability to make a profit.
 
TWFirst
Posts: 5752
Joined: Wed Apr 19, 2000 5:30 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 12:44 am

This story also appeared on ABCNews.com and our local paper.

I'd sure be happy if TW accepted it and remained an independent, but I'd still wonder about the long-term viability of TWA, now that more information about their finances has come to light due to the bankruptcy filing.

I also wonder: where was Continental before? Why didn't Continental and TWA form a code-sharing alliance before all this? I think it would be awesome if TW fully joined with the NW/CO/KLM/Alitalia alliance.
An unexamined life isn't worth living.
 
ryanair
Posts: 646
Joined: Tue Jul 06, 1999 1:41 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 2:20 am

I really doubt TWA can survive long term, again looking at the numbers it'll survive until the end of Karabu, but beyond that is at best questionable.

It's so very sad to see TWA go, but a slice by slice like Pan Am is no better option.
 
TWFirst
Posts: 5752
Joined: Wed Apr 19, 2000 5:30 am

RE: Ryanair

Thu Jan 25, 2001 2:27 am

Actually, it's the other way around. I think it's questionable they'll survive until the end of Karabu, but beyond that, it looks much better.
An unexamined life isn't worth living.
 
Guest

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 2:34 am

".....would be awesome if TW fully joined with the NW/CO/KLM/Alitalia alliance."

'First, you know there is no such alliance. Alitalia is almost completely on their own now following the breakup of Alitalia and KLM, and while CO codeshares with NW, it's European codeshare partners are Air France and Virgin Atlantic. Actually, after the AF vs CO lawsuit (over Concorde disaster), that link-up may be over with.

Servaas,

Certainly, you didn't understand my post very well. I wondered if to compliment (or strengthen) its NYC market-share, CO might start up an operation at JFK very much like it has at LGA with these supposed slots. CO flights from JFK or LGA to EWR are completely out of the question and would never occur.

Regards,
russell
 
Republic
Topic Author
Posts: 541
Joined: Thu Dec 27, 2012 12:39 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 2:38 am

TWFirst:

Where was CO before? Don't forget, CO was battling NW for its own independence. NW was set to control CO by 2005 if they courts did not force NW to sell back part of its stake to CO. By the time this concluded, TW had already entered into a codeshare with HP.

Is CO the knight in white/blue/silver armor? Is CO after what is best for TW? Probably not. But AA's deal was for $500 million for STL hub and Worldspan. CO's counteroffer, if this article is correct, is for slots that TW supposedly is not using. Is it dismemberment? Of course. But if TWA wants to fight to stay alive, here is a lifeline.

Rgds,

Joe
 
TWFirst
Posts: 5752
Joined: Wed Apr 19, 2000 5:30 am

RE: TWAneedsNOhelp/Republic

Thu Jan 25, 2001 3:25 am

Russ:

I think you misunderstood the context in which I'm using the word "alliance" here. I'm looking at this from a NW perspective. NW/KLM markets itself and operates essentially as one airline. As we know, NW and CO also operate almost as one airline here in the U.S. NW and Alitalia have a close code-share relationship. Granted, Alitalia and KLM have some bad blood, but the point here is that the 4 of them have been working on a total cooperative pact for some time, and right now, form a loose alliance (stronger between some members than others). This isn't as yet an "alliance" in the context of oneworld or Star, but I think that group is generally looked at as a foursome, thus my reference to them as such. They're definitely marketed that way here in the Twin Cities.

Also, I believe the CO/AF deal has been set to expire for sometime. AF made this clear after they hooked up with Delta.

Republic:

I'm afraid I'll have to disagree with you on the relevance of the NW stock ownership situation to Continental's code-share offer with TW. Granted, CO was busy, but I don't believe this prevented CO from working on any strategic relationships. There also wasn't any immediate danger that NW would swallow CO. CO saw an opportunity to take care of the situation now due to the DOJ's opposition to the NW stake, as well as the DOJ's skeptical view of what is happening in the industry. I believe if there was ever contact between TW and CO regarding a hook-up, and CO told TW "we want to do this but we're busy right now getting NW out of our hair, we'll get back to you" TW would have waited rather than saying something like "America West will do," which is the way I'm interpreting your comments.

Also, I don't understand your last paragraph. You state that CO's offer is for assets TW doesn't use. But then you state that the offer is the equivalent of dismemberment. I disagree. CO is essentially offering TW up to $400 million in working capital to pay it's bills, in exchange for some dispensable and under-used assets. The way I understand it, this allows TWA to survive pretty much intact, and more importantly, prevents AA from getting huge. CO also is offering code-sharing as way to help TW stay financially healthy. Why would CO want to do this? Again, it prevents another MEGA carrier from forming, provides CO with extended reach and feed, and helps strengthen it as an independent carrier that is strategically cooperating with 2 other smaller carriers to combat MEGA-AIR (aka United/AA).
An unexamined life isn't worth living.
 
workbench
Posts: 163
Joined: Wed Aug 11, 1999 3:22 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 3:40 am

AA has already paid TWA 250 million in debtor in posseccion financing that CO would have to pay back to AA. Additionally, there is a 70 million break up clause in the proposal that either TW/CO would have to pay AA in the event that this deal is broken up. Finally, the bid for TWA must be a minimum of 80 million over AA's bid.
Dont forget TWA had to surrender their 38% holding in worldspan to AA as collateral.

I dont think the AA deal can be stopped.
 
sccutler
Posts: 5555
Joined: Thu Jan 27, 2000 12:16 pm

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 4:18 am

Ithink this is a brilliant move on CO's part.

To address some issues raised above, first remember that the 1200-pound gorilla for TWA pre-petition was its staggering and unworkable debt load, not an inability to run an otherwise successful airline; absent its debt load and poor balance sheet, it could have negotiated dramatically better leases for aircraft, hedged fuel price risk and avoided excessively-high working line debt. With that in mind, consider the following:

1. CO was likely not interested in an alliance or codeshare w/ TW before, inasmuch as TW was financially crippled and (as its balance sheet showed) not a long-term player. Stranding pax travelling on CO tickets, regardless of who's operating the jet, is bad business.

2. If (as has been reported, though I'll hold comment until I see scope of CO's bid) the majority of the assets for which CO is bidding are, truly, un- or under-utilized, then the bulk of the cash could be used for operating capital, thus reducing or maybe eliminating one of TWA biggest obstacles to operating profits;

3. Karabu still likely goes away, as a rejected "executory contract" in bankruptcy;

4. TWA's improved balance sheet (after bankruptcy and sale of assets), coupled with CO's cozy relationship w/ Boeing, would promote much better lease terms;

5. The salutary interest of preserved competition is favored (and don't be surprised if, in this context, Justice were to weigh in as a "friend of the Court" favoring the CO plan... though, given that both AA and CO are Texas outfits, the Bush Justice Dept. might try to remain neutral);

None of this is to suggest that I think CO's bid is likely to succeed, but I think it has a shot.

Very interesting! This is good fun, eh?
...three miles from BRONS, clear for the ILS one five approach...
 
767ALLTHEWAY
Posts: 636
Joined: Mon Nov 22, 1999 5:37 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 4:30 am

Remember how Continental came back to being a great airline. TWA could learn a lot from Continental.
-767ALLTHEWAY
"Courage is not the absence of fear, but rather the judgement that something else is more important than fear"
 
Guest

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 4:31 am

Debt load wasn't the only issue forcing TWA to submit to absurd lease contracts. TWA also had a very poor credit rating (which appears justified considering that they went bankrupt again). Even if TWA's debt is wiped out, I don't imagine its credit rating is going to improve after a third bankruptcy. If TWA decides to emerge from Chapter 11 as an independent entity, it WILL fail again. A $400 mill infusion for assets (regardless of whether the assets are used or not) will last at most a year or two.
 
jr
Posts: 1043
Joined: Tue May 18, 1999 1:15 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 4:35 am

yeah this is a lot of fun. But do you think karabu will go away if TWA decides to stay independent? Will it really be successful in getting it voided completely?
I've flown on 9V-SPK.
 
N766UA
Posts: 7843
Joined: Thu Jul 29, 1999 3:50 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 4:39 am

CO managment have their heads screw on. They know that this can kill them and competition if it goes through.
This Website Censors Me
 
AA767400
Posts: 1889
Joined: Tue Jan 23, 2001 2:04 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 4:58 am

CO is already in EWR where it belongs!
also CO already has a alliance/codeshares with NW,
now it wants one with TW so that it can play head on with UA. megermania!
in the long run,TW will go into the deep end again.
NYC cannot be run only by CO, this is not going to happen, they are in EWR, AA is in JFK.

"The low fares airline."
 
ishky15
Posts: 706
Joined: Tue May 30, 2000 12:02 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 5:07 am

"AA is in JFK"? WRONG. American is spread out just as much around the New York area as Continental is. At EWR, American serves the following destinations:
Dallas
Boston
Chicago
Los Angeles
Miami
London
San Juan

Continental, on the opther hand, serves the following destinations from Dallas:
Newark
Houston
Cleveland

American serves the following destinations from LaGuardia:
Chicago
Providence
Dallas
Miami
Washington
Cleveland
Richmond
Norfolk
and many more cities in Florida and New England

Continental, however, serves the following destinations from Chicago, another AA megahub:
Cleveland
Houston
Newark

If American is allowed to have all those flights from the New York area when they don't even commit to it as a major hub, Continental should be allowed to to have just a few more flights at LaGuardia and JFK. Besides, no one said they wanted a fourth hub, all they want to do is place some of their New York passengers on flights from those two other airports.
 
AA767400
Posts: 1889
Joined: Tue Jan 23, 2001 2:04 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 5:19 am

hey shky, i never said it was a hub, i know where my
hubs are at!
and another thing JFK is a big international base not hub
for AA. just CO out of EWR.
CO at EWR AA at JFK
GIG GIG
SJU SJU
SDQ SDQ
BDA BDA
CDG CDG
CCS CCS
MBJ MBJ
STT STT

remember CO and AA go head to head in latin america!
"The low fares airline."
 
Guest

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 6:55 am

No one is advocating for a CO hub at JFK dude. Just an idea that if they pick up some of these TW JFK slots, they could add a bunch of new RJ flights for O&D pax. They already have a strong presence in NY and to solidify it, they could compliment their EWR hub operation with additional flights from LGA (already doing it) and possibly JFK (thats the idea).

Most likely, though AA will acquire all of TW. CO likes to make waves (remember CO buying DC Air), but seems to act conservatively.

Regards,
Russell
 
AA@DFW
Posts: 392
Joined: Sat Sep 09, 2000 8:06 pm

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 7:42 am

I agree with workbench -- I don't think there is any way to stop AA now. They have this tied up nice and tight. What workbench said is all true.

 
Republic
Topic Author
Posts: 541
Joined: Thu Dec 27, 2012 12:39 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 8:51 am

The deal between AA and TW for $500 million included the Worldspan res system. NW, in a separate filing, expressed interest in Worldspan, rumored to be around $160 million.

CO's plan at $400 million, NW's at $160 million makes $560 million, plus keeps TW as a independent airline, with enhanced revenue opportunities through a possible CO/TW codeshare. AA's ends TW, takes its prized assets, and keeps TW employees and assumes the obligations of their fleet.

Either way, TW as we know is no longer. From a competitive standpoint, I favor the CO/TW plan. Time will play this out. But where the heck is Delta? It seems that its management has its head up its a@@, sitting on the sidelines as US, then TW are carved up by UA and AA. Maybe (I seriously doubt this will happen) CO ought to buy DL and let Bethune and Breneman run DL. I bet that if B&B ran DL, they would not be sitting back watching the consolidation of the US airline industry as they fight their own pilots.

My .03 worth,
Joe
 
RedEye
Posts: 77
Joined: Sun Oct 08, 2000 5:43 am

American's Response

Thu Jan 25, 2001 9:15 am

here's American's response:

Press Release

SOURCE: American Airlines

American Airlines' Statement on TWA Bankruptcy Filings By Certain Other
Carriers

FORT WORTH, Texas, Jan. 24 /PRNewswire/ --

American Airlines today made the following statement in response to
reports that other carriers have filed with a bankruptcy court
in Delaware, expressing interest in acquiring assets of Trans World
Airlines (Amex: TWA - news):

``The bankruptcy proceeding is an open process, and we always recognized
that other airlines might also express interest in TWA's assets. In this
case, neither of the carriers filing comments has made an actual offer,
and their comments suggest that they are interested simply in stripping
valuable TWA assets without keeping the airline intact. This contrasts
dramatically with American's offer.

``American Airlines has put forward a fairly priced package that calls
for TWA to be integrated into American. This will provide continued
opportunity for TWA's employees, a continued hub operation in St. Louis,
and protection for the retirement benefits of TWA's employees.
Furthermore, American is providing TWA with $200 million in
debtor-in-possession financing to allow TWA to continue operating until
our transaction is completed. Without that financing, TWA would have
been forced to shutdown.

``We are confident that when the bankruptcy court weighs all of the
alternatives, it will see American's bid as the superior proposal.''

Current AMR Corp. (NYSE: AMR - news) news releases can be accessed via
the Internet. The address is http://www.amrcorp.com/corpcomm.htm.

SOURCE: American Airlines
 
ScottB
Posts: 5413
Joined: Fri Jul 28, 2000 1:25 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 9:20 am

The creditors will likely have a say in which bid(s) are accepted as well. It's the bankruptcy judge's responsibility to ensure that the creditors recover as much as possible of what they lent to TWA.
 
Prinair
Posts: 621
Joined: Thu Dec 02, 1999 7:28 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 10:36 am

If you believe that AA will keep their word about the TWA employees, then you are very naive.

AA is acting like a sweet saintly savior, after the deal goes thru they will show their true colors, devil red. AA will find a way on getting rid of the TWA people and keeping only the few assets that it wants.

Point of reference:

Reno Air
TransCaribbean Airways
AirCal
PRINAIR : Puerto Rico International Airlines
 
QantasA330
Posts: 304
Joined: Tue Dec 05, 2000 1:57 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 11:22 am

I'll second Prinair's opinion. AA may not be quite as sweet as everyone thinks...

Kindest Regards,
 SmileQantasA330 Smile
 
AA767400
Posts: 1889
Joined: Tue Jan 23, 2001 2:04 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 12:01 pm

U got that right prinair! AA eats up then spits out.
"The low fares airline."
 
ContinentalEWR
Posts: 3619
Joined: Wed May 24, 2000 2:50 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 12:01 pm

AA767400, AA is most definitely NOT at JFK. They have about 70 mainline flights a day to London, Paris, and to
dozens of Caribbean destinations, a handful of US cities
and transcons to LAX, SFO, and SAN. They are building
a huge 54 gate terminal with a midfield complex that is
going to be half empty at the way they add then drop
flights out of JFK.

JFK is a gateway for AA but far from being a hub. I am
almost certain DL is bigger at JFK and will get even
bigger as it adds more flights (up to 170 daily by 2003).

As for Continental's bid, it's a form of self-defense and
an intelligent move on their part. They've thrown a
monkey wrench into AA and UA's plans to carve out a
cozy duopoly for themselves. Ultimately, I think AA's
plans for TWA are the best "global" solution as their
management put it. Additional LGA and JFK slots are
not critical to CO given their hub at Newark, but it
would help them grab additional market share. In the
present environment, CO has about 31% of the traffic
to and from NY airports.

TWA is a basket case. It was ruined by Carl Icahn
through greed, neglect, and greed, greed, greed. TWA
cannot come back from the brink again. I think AA's
plan is the best solution for those 20,000 employees.

ContinentalEWR
 
AA767400
Posts: 1889
Joined: Tue Jan 23, 2001 2:04 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 12:15 pm

HELLO i never said it was a HUB or the BIGGEST AIRLINE IN JFK! all i am saying is CO is in EWR where it should be!
"The low fares airline."
 
toxtethogrady
Posts: 1693
Joined: Sat Dec 23, 2000 12:33 pm

Yeah, Sure, CO's Money Will Keep TW Alive...

Thu Jan 25, 2001 1:51 pm

Like when Delta bought Pan Am's crown jewels!
 
Trvlr
Posts: 4251
Joined: Thu Feb 17, 2000 9:58 am

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 2:00 pm

My Theory: CO saves TW, buys into AmWest, restructures the whole damn thing and becomes a major player everywhere. NW will probably have to join in too to get HP under control.

Aaron G.
 
toxtethogrady
Posts: 1693
Joined: Sat Dec 23, 2000 12:33 pm

CO Just Sold Out Of HP...

Thu Jan 25, 2001 2:08 pm

Only a severe case of schizophrenia would get them back in.

As for AA at JFK, they are investing in 60 gates - for them and their codeshare partners. If they are not a major player there, they will be.

Here's to Continental getting what they want. It's less likely to diminish competition
 
User avatar
BNE
Posts: 2921
Joined: Fri Mar 31, 2000 9:37 pm

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 7:14 pm

AA is the best thing for TWA especially the employees. All I can see Continental is forcing up the price that AA pays for TWA. Continental probably don't like the idea of how UA/US and AA/TWA are making themselves so much bigger than the rest.
Maybe with Continental putting in their bid it just might keep them in the loop of information so if anything should come up that AA don't want Continental might buy something cheap.
Continental are not going to help TWA.

Why fly non stop when you can connect
 
Tan Flyr
Posts: 1558
Joined: Sat Aug 19, 2000 11:07 pm

RE: CO Offers TWA Cash To Stay Alive

Thu Jan 25, 2001 11:29 pm

Just to add a couple of other thoughts here since almost a day has passed. Politics will play a BIG role in this. Mr. Gephart of STL will push hard to preserve jobs in STL. The deal that best does this will gert his blessing & support. Second, sooner or later Mr. Ashcroft will be the AG of the US. Hmmm, he is from St.Louis..Hmmm, Job preservation, retirees, etc., again the deal that best preserves those will be the politically expedient thing to do.
Now, the court may or maynot, allow/or even demand that CO buy/AA sell specific TW slots/gates etc.
all in all, I think AA has a right deal here.
 
DCA-ROCguy
Posts: 3890
Joined: Fri Apr 21, 2000 5:03 am

RE: CO Offers TWA Cash To Stay Alive

Fri Jan 26, 2001 12:43 am

The bankruptcy court should weigh CO's and NW's bids for TWA assets carefully. The AA solution to the "What to do with bankrupt TWA and very solvent-but-terminally-ill US Airways" game--two megacarriers and a second tier of three majors itching to consolidate--is not ideal. My own rough estimate is that DOJ and the airlines should seek a game plan that results in five carriers of over 10 percent of USA market share, and none with over 20 percent. Anything more is risky for consumers and communities.


AA's plan may be the least disruptive way to save TWA and preserve some competition among the majors, but it should not be viewed as final til everyone has been heard. Continental is probably unhappy with the idea that AA could end up with 50 percent of JFK, and threaten that 31 percent CO share of the overall New York market. AA already has control over the Sabre reservation system, they don't need to add TWA's system as well.

An outcome where AA gets STL and keeps it intact, but CO gets JFK and perhaps TW focus cities (or maybe someone else bids for those?) would be better than AA getting the whole kit and caboodle (sp?). Meanwhile, DOJ should demand further divestitures by AA and UA in their buyout of US--perhaps a whole hub. UA and AA might be held to 20 percent of the USA market, and the TW and US problems could be resolved.

Such an arrangement would find employment for TW and US employees, keep hub facilities intact, preserve more competition, and still drive a stake through get Count Icahn-ula the Karabu Vampire. Which is the proximate cause of this whole mess in the first place, as several have noted.

Jim
Need a new airline paint scheme? Better call Saul! (Bass that is)
 
Airman1
Posts: 1
Joined: Sat Aug 22, 2015 2:54 pm

TWA Employees Are Short-sighted If They Support AA

Fri Jan 26, 2001 6:12 am

Dear TWA employees supporting the AA deal:

Please answer the following questions:

1) Has AA guaranteed your jobs? If so, what is securing this guarantee -- AA's "word"? And what makes this word particularly valuable.

2) One of the reasons TWA failed was because of its high cost structure -- including employment agreements. What makes you think that AA will deliver favorable terms to you?

3) The IAM has no presence at AA. Who is going to negotiate your position for you?

4) TWA and AA have MANY overlapping routes in the Carribean, JFK, and even STL. What makes you think American will let you keep your jobs, given this overlap?

If you're banking on the "word" of American, bank somewhere else. Your jobs remain in peril, with no guarantees of success or remployment, and a likely demotion/loss of seniority upon AA's final purchase.

Keeping TWA flying is the ONLY way to guarantee your seniority and jobs remain.

Looking at the Continental and NWA offers, it seems rather obvious that the bankruptcy judge will accept them. Here's why:

1) CO is interested in buying UNUSED slots and gates at ORD, JFK, and DCA. These are unmonetized, pointless assets at this point, anyway, with no associated jobs, that free up CASH for TWA to hedge fuel costs and continue operating AS IT DOES TODAY, moving toward profitability.

2) The only major usable asset I can think of that TWA may lose in selling to Continental is the Trans World Terminal (T5) at JFK, which is antique, has been underutilized for years, and is to be closed in 2003 anyway. JFK is no longer really a TWA hub. Shrinking TWA to seven or so gates at JFK will allow it to maintain its current transcontinental, eastern and European flights, with room for growth, without the decrepit albatross that is T5.

Anyone who believes American's "commitment" to them is genuine should stop smoking crack -- it's illegal in this country. You have NOTHING to base your hopes upon, other than AA's (spotty at best) "commitment."

The only way to truly hope to maintain your jobs with minimal damage is accept a proposal that allows TWA to continue in its present form, with its present network, with lower costs and higher capital. The CO/NWA plan does that handily -- and gives TWA room to breathe, make money, and (gasp) GROW again a few years down the line.
 
ishky15
Posts: 706
Joined: Tue May 30, 2000 12:02 am

RE: TWA Employees Are Short-sighted If They Support AA

Fri Jan 26, 2001 6:54 am

I compeletely agree with Airman1's points. There are good and bad sides to both options. AMR's purchase of TWA will be good for AMR and will put a quick death upon TW, but this will greatly reduce competition in the US air market, thus raising fares. Continental's purchase of TWA's unused slots at valuable airports will be good for both airlines as they would provide some cash for TWA so that they can have yet another chance and Continental will be able to add just a couple more flights out of some very exclusive airports.

And to all you people who claim that AMR's purchase of TWA will ensure that the jobs of their employees will be saved, rememeber Reno? American quickly suspended most flights to Reno, Nevada and shifted those flights to places liek San Jose and Los Angeles. I'm not saying that they'll shift all the flights out of St. Louis, but it's not like its gonna remain 100% the same after AA moves in, if they do. And not necessarily will all of the 20,000 jobs be saved; the people who work in TW's headquarters all won't have jobs, AA already has a headquarters in Dallas.

Either purchase would be great for TWA, but if they are bought out by American, fares will be much higher and the market will be controlled by two airlines, United and American. One out of every two passengers who fly somewhere will be flying one of those two airlines. One out of two planes you see at the airport wil belong to either one of those airlines, especially in cities like New York, Los Angeles, Chicago, Washington, Miami, Boston, Dallas, and Honolulu. Look at the names of those cities, people. A quarter of our nation's people live in those cities alone that I mentioned.
 
FrontierMan
Posts: 384
Joined: Thu Oct 28, 1999 6:19 am

RE: TWAneedsNOhelp/Republic

Fri Jan 26, 2001 8:07 am

I must disagree that TWA is being dismembered. TWA has been downsizing JFK for a very long time, and focusing on STL. I watched as I saw European routes disappear from TWA's routemap from JFK and wondered why. Lights began to turn on as I watched an illogical partnership with America West. Why wouldn't they go for a partner based in the northeast? Why would they partner up if LA would become a focus city.

TWA does not compete with Continental on some of its Midwest routes. TWA flies to Moline, Peoria, Souix Falls, etc. and CO does not.

I think that TWA just ran out of time when the whole turnaround went underway. After 800, they updated the fleet and began dropping European routes and some American cities. Eventually, they just ran out of time.

I'd also rather see TWA survive and have a chance of making it through, versus watching TWA disappear like RenoAir did into American.
 
ryanair
Posts: 646
Joined: Tue Jul 06, 1999 1:41 am

RE: CO Offers TWA Cash To Stay Alive

Sat Jan 27, 2001 3:25 am

The CO and NW offers donot in anyway address TWA's fundamental problems:

1. Gutter credit rating (ie. NO CREDIT FACILITIES AT ALL)
2. High aircraft rental costs.
3. High staff costs.
4. Underfunded pension now Ichans pulled out.
5. High cost maintainence facilities that can't be shut.
6. Debt.
7. Lack of licquidity.

TWA only has a long term future when each and everyone of these is solved.

Yes debt will slightly reduce, but nobody on earth will supply funds to a debt ridden company that if the AA deal is rejected will be summerised as follow:

Astronomic costs, loss making since the late 1980's, just out of it's third Chapter 11 in ten years, asset striping to survive with a failed licquidation strategy. Current Strategic Plan (ie. the plan before AA) previously rejected in favour of licquidation.

If you were a credit rating agency, would you improve their rating with that background? Would you lend a company like that money, give them goods (like $100 million planes, or computer systems, consultancies) on credit? I doubt anyone would claim to here were it not for the romance/ emotional TWA factor, let me tell you Wall St etal donot work on the basis of romance, as I'm sure everyone knows.

Believeing the CO/NW deals will make everything better is romantic nonsence on a par with Jane Austin, that is a nice fantasy, with no basis in fact.

I agree with Airman1 in as far that AA will not be that nice for ever, I can't recall any merger where ALL staff have been kept long term.

I am very sad to see TWA go, I don't want them to go!!! I'm flying them across the pond next week and very sad it'll be the last time. I'm sad to stand by the fact, one way or another it will be the last time.
 
twa
Posts: 819
Joined: Sun Sep 19, 2010 10:59 pm

RE: CO Just Sold Out Of HP...

Sat Jan 27, 2001 7:13 am

Sounds like a longshot, But I am 100% for it!!!!!

TWA