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USAirALB
Topic Author
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Reasoning behind PSA/US merger

Tue Jun 16, 2020 10:50 pm

A recent thread that highlighted the AA/QQ merger in the late 1990s got me thinking about the PSA/US merger in the late 1980s, and I can't for the life of me figure out US' reasoning behind it. The AA/QQ merger at least makes some sense to me, given the strength of the SJC market in the 1990s and one could argue that the SJC operation was a victim of 9/11.

In the case of US/PSA, the West Coast operation was already gone by the time 9/11 came around. I believe the domiciles at LAX/SFO had already been closed before 9/11. By the time the year 1999 came around, I believe the entire LAX operation was down to CLT/PIT/PHL/BWI, along with FAT/SAN/SBA on Express, with SFO being the same except for SMF/MRY instead of SAN/SBA.

At one point IIRC in the early 1990s, US had the most departures from California than any other airline, as seen in this TV ad: https://www.youtube.com/watch?v=r1QSGEZ7YWk .

In late 1992, the carrier still had an hourly "California Shuttle" service on LAX-SFO, and still featured mainline on LAX-LAS/RNO/SAN/SFO/SMF, SAN-SFO, SFO-LAS/RNO/SEA, SEA-RNO. By this time, however, it appears that the non-Californian cities that were too small to support transcontinental service had been dropped, like PDX, TUS, and BLI.

A route map from 2000 shows the entire Express operation gone, leaving SEA/SFO/SNA/LAX/SAN the only West coast cities US served, all on transcontinental flights from BWI/CLT/PIT/PHL.

What exactly happened; was it the entrance of WN into the West Coast market, coupled with US high costs and labor issues?
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USPIT10L
Posts: 2055
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Re: Reasoning behind PSA/US merger

Tue Jun 16, 2020 11:10 pm

WN didn't enter the intra-Cali market until after US downsized he PSA network. Simply put, like AA/OC (AirCal) alongside it, USAir's higher costs doomed the short-haul flying up and down the west coast. It didn't help when US moved the MD-82s and DC-9s back east, using 733s and BAe-146s up and down the coast.

Plus, it didn't help that the PSA-style service was replaced with USAir's more business-like approach.

If you're interested in PSA's history, I strongly suggest getting your hands on the late Gary Kissel's book "Poor Sailor's Airline." He was the PR director for the airline from 1968 to the end. There's also the excellent PSA History Page online.
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wedgetail737
Posts: 5198
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Re: Reasoning behind PSA/US merger

Tue Jun 16, 2020 11:21 pm

The elimination of the 146's pretty much put the last nail into the coffin of the west coast operations for US.
 
ScottB
Posts: 6921
Joined: Fri Jul 28, 2000 1:25 am

Re: Reasoning behind PSA/US merger

Tue Jun 16, 2020 11:36 pm

USAirALB wrote:
A recent thread that highlighted the AA/QQ merger in the late 1990s got me thinking about the PSA/US merger in the late 1980s, and I can't for the life of me figure out US' reasoning behind it.

...

What exactly happened; was it the entrance of WN into the West Coast market, coupled with US high costs and labor issues?


So the 1980s were the time of merger mania in the airline industry, and US was a prolific participant, with Allegheny already having bought Lake Central and Mohawk before renaming itself to USAir in 1979. They bought both Piedmont and PSA, and Piedmont had itself bought Empire in 1986. You can tell by the rebrand from Allegheny to USAir that the goal was to grow from a regional carrier (as defined in those days and distinct from commuters) into a carrier with nationwide coverage. They weren't the only ones playing that game, all of the top 8 carriers in 2000 had grown through mergers. Delta, for example, grew beyond its history as a regional in the Southeast through mergers with C&S, Northeast, and Western, as well as buying assets from Pan Am.

So PSA was available to buy, and USAir desperately wanted to grow out west given the rapid economic growth away from its core markets in the Rust Belt. Pittsburgh had been a good hub location but the local market was shrinking with the region's economic decline. But PSA was ultimately a poor fit since the airline still had almost no presence in the middle of the country and they made some boneheaded decisions like scheduling flights in California as through flights from the East Coast hubs. That had the effect of subjecting local passengers in California to the delays on the East Coast with late-arriving aircraft.

And they had bad timing because WN was growing rapidly in California with much, much lower costs than US. WN could easily price below US's costs and still make a profit. It didn't help that UA decided to engage in a brutal war for California with their Shuttle by United service. AA got caught up in the war for California, too, with their purchase of Air California and their first run at a hub at SJC in the 1980s..
 
n7371f
Posts: 1802
Joined: Fri Jul 04, 2008 3:54 pm

Re: Reasoning behind PSA/US merger

Wed Jun 17, 2020 4:10 am

To answer the thread subject line: not much...
 
timpdx
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Re: Reasoning behind PSA/US merger

Wed Jun 17, 2020 4:29 am

All of West Coast airlines got killed. It sucked, Air Cal, PSA, Reno Air. It was merge and kill. Sure opened the market wide for WN.
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wnflyguy
Posts: 1910
Joined: Thu Feb 10, 2011 7:58 pm

Re: Reasoning behind PSA/US merger

Wed Jun 17, 2020 5:26 am

Best things to happen to Southwest airline was USAIR buying PSA ,American Buying AirCal,Delta buying Western and Alaska buying Jet America. They all gave up strong holds and left a wide open door for WN to move into California.
Flyguy
my post are my opinion only and not those of southwest airlines and or airtran airlines.
 
gaystudpilot
Posts: 250
Joined: Sat Dec 08, 2007 10:55 pm

Re: Reasoning behind PSA/US merger

Wed Jun 17, 2020 5:29 am

timpdx wrote:
All of West Coast airlines got killed. It sucked, Air Cal, PSA, Reno Air. It was merge and kill. Sure opened the market wide for WN.


All? AS?
 
Ionosphere
Posts: 257
Joined: Wed Apr 06, 2016 6:46 pm

Re: Reasoning behind PSA/US merger

Wed Jun 17, 2020 5:44 am

ScottB wrote:
USAirALB wrote:
A recent thread that highlighted the AA/QQ merger in the late 1990s got me thinking about the PSA/US merger in the late 1980s, and I can't for the life of me figure out US' reasoning behind it.

...

What exactly happened; was it the entrance of WN into the West Coast market, coupled with US high costs and labor issues?


So the 1980s were the time of merger mania in the airline industry, and US was a prolific participant, with Allegheny already having bought Lake Central and Mohawk before renaming itself to USAir in 1979. They bought both Piedmont and PSA, and Piedmont had itself bought Empire in 1986. You can tell by the rebrand from Allegheny to USAir that the goal was to grow from a regional carrier (as defined in those days and distinct from commuters) into a carrier with nationwide coverage. They weren't the only ones playing that game, all of the top 8 carriers in 2000 had grown through mergers. Delta, for example, grew beyond its history as a regional in the Southeast through mergers with C&S, Northeast, and Western, as well as buying assets from Pan Am.

So PSA was available to buy, and USAir desperately wanted to grow out west given the rapid economic growth away from its core markets in the Rust Belt. Pittsburgh had been a good hub location but the local market was shrinking with the region's economic decline. But PSA was ultimately a poor fit since the airline still had almost no presence in the middle of the country and they made some boneheaded decisions like scheduling flights in California as through flights from the East Coast hubs. That had the effect of subjecting local passengers in California to the delays on the East Coast with late-arriving aircraft.

And they had bad timing because WN was growing rapidly in California with much, much lower costs than US. WN could easily price below US's costs and still make a profit. It didn't help that UA decided to engage in a brutal war for California with their Shuttle by United service. AA got caught up in the war for California, too, with their purchase of Air California and their first run at a hub at SJC in the 1980s..


US1493 collided with an OO Metroliner at LAX on February 1, 1991. It was a 733 flying SYR-DCA-CMH-LAX-SFO.
 
Chemist
Posts: 735
Joined: Tue Oct 20, 2015 4:46 am

Re: Reasoning behind PSA/US merger

Wed Jun 17, 2020 6:00 am

PSA was great; I flew them on both the 727 and the BA146.
American and USAir killed off two really good airlines.
 
N383SW
Posts: 124
Joined: Wed Nov 09, 2016 10:28 pm

Re: Reasoning behind PSA/US merger

Wed Jun 17, 2020 6:01 am

Ionosphere wrote:
ScottB wrote:
USAirALB wrote:
A recent thread that highlighted the AA/QQ merger in the late 1990s got me thinking about the PSA/US merger in the late 1980s, and I can't for the life of me figure out US' reasoning behind it.

...

What exactly happened; was it the entrance of WN into the West Coast market, coupled with US high costs and labor issues?


So the 1980s were the time of merger mania in the airline industry, and US was a prolific participant, with Allegheny already having bought Lake Central and Mohawk before renaming itself to USAir in 1979. They bought both Piedmont and PSA, and Piedmont had itself bought Empire in 1986. You can tell by the rebrand from Allegheny to USAir that the goal was to grow from a regional carrier (as defined in those days and distinct from commuters) into a carrier with nationwide coverage. They weren't the only ones playing that game, all of the top 8 carriers in 2000 had grown through mergers. Delta, for example, grew beyond its history as a regional in the Southeast through mergers with C&S, Northeast, and Western, as well as buying assets from Pan Am.

So PSA was available to buy, and USAir desperately wanted to grow out west given the rapid economic growth away from its core markets in the Rust Belt. Pittsburgh had been a good hub location but the local market was shrinking with the region's economic decline. But PSA was ultimately a poor fit since the airline still had almost no presence in the middle of the country and they made some boneheaded decisions like scheduling flights in California as through flights from the East Coast hubs. That had the effect of subjecting local passengers in California to the delays on the East Coast with late-arriving aircraft.

And they had bad timing because WN was growing rapidly in California with much, much lower costs than US. WN could easily price below US's costs and still make a profit. It didn't help that UA decided to engage in a brutal war for California with their Shuttle by United service. AA got caught up in the war for California, too, with their purchase of Air California and their first run at a hub at SJC in the 1980s..


US1493 collided with an OO Metroliner at LAX on February 1, 1991. It was a 733 flying SYR-DCA-CMH-LAX-SFO.


What does that have to with this discussion?
 
Ionosphere
Posts: 257
Joined: Wed Apr 06, 2016 6:46 pm

Re: Reasoning behind PSA/US merger

Wed Jun 17, 2020 6:38 am

N383SW wrote:
Ionosphere wrote:
ScottB wrote:

So the 1980s were the time of merger mania in the airline industry, and US was a prolific participant, with Allegheny already having bought Lake Central and Mohawk before renaming itself to USAir in 1979. They bought both Piedmont and PSA, and Piedmont had itself bought Empire in 1986. You can tell by the rebrand from Allegheny to USAir that the goal was to grow from a regional carrier (as defined in those days and distinct from commuters) into a carrier with nationwide coverage. They weren't the only ones playing that game, all of the top 8 carriers in 2000 had grown through mergers. Delta, for example, grew beyond its history as a regional in the Southeast through mergers with C&S, Northeast, and Western, as well as buying assets from Pan Am.

So PSA was available to buy, and USAir desperately wanted to grow out west given the rapid economic growth away from its core markets in the Rust Belt. Pittsburgh had been a good hub location but the local market was shrinking with the region's economic decline. But PSA was ultimately a poor fit since the airline still had almost no presence in the middle of the country and they made some boneheaded decisions like scheduling flights in California as through flights from the East Coast hubs. That had the effect of subjecting local passengers in California to the delays on the East Coast with late-arriving aircraft.

And they had bad timing because WN was growing rapidly in California with much, much lower costs than US. WN could easily price below US's costs and still make a profit. It didn't help that UA decided to engage in a brutal war for California with their Shuttle by United service. AA got caught up in the war for California, too, with their purchase of Air California and their first run at a hub at SJC in the 1980s..


US1493 collided with an OO Metroliner at LAX on February 1, 1991. It was a 733 flying SYR-DCA-CMH-LAX-SFO.


What does that have to with this discussion?


Perfect example of a late arriving aircraft from the East Coast scheduled to fly West Coast flying
 
departedflights
Posts: 103
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Re: Reasoning behind PSA/US merger

Wed Jun 17, 2020 12:51 pm

wnflyguy wrote:
Best things to happen to Southwest airline was USAIR buying PSA ,American Buying AirCal,Delta buying Western and Alaska buying Jet America. They all gave up strong holds and left a wide open door for WN to move into California.
Flyguy


I don't know that I would include the Alaska acquisition of Jet America in the same category as the others.

Jet America's intra-West Coast operation consisted, at its peak, of a handful of flights a day from Vegas to southern California and a few flights a day between the Pacific Northwest and Vegas/Orange County.

I don't think they ever even operated an intra-California route.

Jet America's route system was always much more east-west oriented and I don't know that they ever had more than seven or eight planes in their fleet.

So again, I would not include AS/SI in the same category as the others.
The opinions are expressed are my own and do not represent those of anyone else, including my coworkers or my employer.
 
DesertAir
Posts: 1446
Joined: Sat Jan 28, 2006 1:34 am

Re: Reasoning behind PSA/US merger

Wed Jun 17, 2020 12:58 pm

The large airlines like AA and US did not know how to operate the California network. I was a loyal PSA flyer and recall when US took over. The spirit of the PSA (fun and informal) experience was lost. The FAs tried serving meals on the short California flights. That ended quickly. It was a shame to lose those local colorful airlines like PSA, AirCal, Ozark...
 
MIAFLLPBIFlyer
Posts: 475
Joined: Mon Jul 03, 2017 8:25 pm

Re: Reasoning behind PSA/US merger

Wed Jun 17, 2020 1:56 pm

DesertAir wrote:
The large airlines like AA and US did not know how to operate the California network. I was a loyal PSA flyer and recall when US took over. The spirit of the PSA (fun and informal) experience was lost. The FAs tried serving meals on the short California flights. That ended quickly. It was a shame to lose those local colorful airlines like PSA, AirCal, Ozark...


This is part of why Southwest was such a big hit when it got to California. Even the style of the cabin crew etc was much more in sync with traveler preferences in the state from what I am told.
 
MIAFLLPBIFlyer
Posts: 475
Joined: Mon Jul 03, 2017 8:25 pm

Re: Reasoning behind PSA/US merger

Wed Jun 17, 2020 2:00 pm

I flew a US flight FLL-TPA-LAX-SFO and return in 1993. Was a real milk run and either end was part of the "shuttle" services - Florida Shuttle and California Shuttle. Not surprisingly the tail end of both runs (LAX-SFO outbound, TPA-FLL inbound) were late. US Air's California and Florida Shuttles were not airlines within airlines at all but generally like this tag-on's to flights coming from elsewhere. What an operational mess. TPA-FLL in particular was a route that once Southwest arrived in Florida, was no longer competitive because they actually did on time even with their milk runs. As for the California Shuttle not sure how much longer past 1993 it lasted. The Florida Shuttle was gone when Southwest came to Florida. MetroJet then became US Airways answer to Southwest. That too didn't end particularly well.
 
AWACSooner
Posts: 2536
Joined: Tue Jan 22, 2008 12:35 am

Re: Reasoning behind PSA/US merger

Wed Jun 17, 2020 4:39 pm

MIAFLLPBIFlyer wrote:
MetroJet then became US Airways answer to Southwest. That too didn't end particularly well.

Yep, but damn, those flying tomatoes were sexy as hell!
 
ytib
Posts: 555
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Re: Reasoning behind PSA/US merger

Wed Jun 17, 2020 4:49 pm

timpdx wrote:
All of West Coast airlines got killed. It sucked, Air Cal, PSA, Reno Air. It was merge and kill. Sure opened the market wide for WN.


WN also purchased a west coast airline in the 90's. Morris Air. They were a charter airline from 1984-1992 and in 1992 became a 121 operator, which lasted all of two years prior to the purchase.
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