Quoting AirportPlan (Reply 37): Here is more information hot off the press. This seem to be very serious. http://chicagobusiness.com/cgi-bin/n...27131

Not sure why that makes it more "serious" - it's the same AP article as in the thread starter, only printed on a different web site.

The biggest question for me is will they outfit all of the DL aircraft with Channel 9  

Quoting DeltaRules (Reply 49): Here's what each operates at a glance

That will be a really really big fleet.

Quoting DL787932ER (Reply 46): This rumor doesn't make a whole lot of sense. Ed Bastian has made several public statements just in the past week indicating that while DL is strongly considering merger possibilities, they would only act as acquirer and not acquiree. It would also ruin all the new loyalty built up in the DL community - employees, customers in hub cities, even politicians - from the "Keep Delta My Delta" campaign.

Welcome to the Hypocisy of the Corporate world.

Personally I agree with EXAAUADL. This is a horrendous idea. The way it stands (according to the article), the City of Atlanta and the State of Georgia come up the losers in this. I think the last round of DL's upper management had the areas interest closer to heart than these dudes seem too. This is like spitting in the face of all those people who worked so hard to keep DL in Gerogia and a standalone company.

Quoting Hoya (Reply 33): The US Government will need to approve. Just like with UA/US proposed merger, the combined DL/UA would cause monopoly issues (ORD 'slots', DCA slots due to IAD hub, three hubs on east coast, ect)

The previous US/UA proposed merger was prior to 9/11/2001. Much has changed since then, like major airline bankruptcies. There will be issues in any combinations, but these combos will happen either now or later...

How is it that many a.netters consider a CO/UA merger a good idea, and a DL/UA merger a bad idea? The routes and fleets of CO and DL are quite similar.

If Delta and United merge, its pretty obvious UA won't leave Star which is pretty darn frustrating. Star is big enough already IMO and although it wouldn't happen, I'd love to see the merged airline leave Star, even if it means leaving Skyteam as well because I would just hate to see Star get even bigger.
But they are pretty well suited together, with mainly Pratt engines but I think NW is a better fit for Delta.

Quoting PADSpot (Reply 18): Would the outcome be associated to SkyTeam or StarAlliance?

Probably go with Star

Quoting EXAAUADL (Reply 19): Mostly likely STAR....Skyteam would go away with members breaking up and going to OneWorld or STAR. I cant see AF going to STAR.

I think you would find that SkyTeam would almost definitely remain. Air France-KLM still have 2 relatively strong US partners in the form of NorthWest and Continental. Continental is strong transatlantic, Northwest is strong transpacific. Perhaps a CO/NW merger would follow

Quoting B747forever (Reply 20): That is what I also asked, look reply 7

Yes, I saw it, but nobody replied. So I asked again.  

Quoting EXAAUADL (Reply 19): Mostly likely STAR....Skyteam would go away with members breaking up and going to OneWorld or STAR. I cant see AF going to STAR.

I did not thought about that ... thought the bigger partner would dictate alliance membership, although anti trust authorities may have a word on that.

Quoting Flydl2atl (Thread starter): It's official, so I thought it might deserve it's own thread...if not I guess the moderators can delete it:

This is not official. It's an unnamed "official" (government? Airline?) that is quoted.

Quoting AirportPlan (Reply 37): Here is more information hot off the press. This seem to be very serious.

No this quotes the same story. There's a Reuters story as well. There is no confirmation of any kind.

Count me among the skeptics for many different reasons: lack of love for UA at DL, govt approval, general lack of reliability of the anonymous source....

I am not saying that some merger does not make sense. Unfortunately, the US airlines are headed for the abyss if we continue to get high fuel and slow economic growth. They have thrived recently for the simple reason: not ordering tons of shiny new planes and thus keeping capacity stable allowed them to keep prices high. But with fuel going even higher, mergers (followed by cuts) are as viable a solution as any other strategy..

Quoting PADSpot (Reply 57): Yes, I saw it, but nobody replied. So I asked again.

Okey, I see.

This merger would cause some serious re-thinking from some other carriers... one that comes to mind is AS... what kind of affect with this have for their long term plans (if they have any)...??? Some sleepless nights are ahead for some of the people in this industry.....

Not saying that I necessarily support this specific combination, but agreed Stitch..........the U.S. airline industry cannot support six full size international carriers. I think everyone would agree with that one. It's ridiculous.

I would also agree with LAXdude1023 in that this is a slap in the face by DL's upper management team.

Quoting EXAAUADL (Reply 9): Looks like UA mgmt mostly gets to run the airline

Where in the report did you read that?

Quoting PavlovsDog (Reply 17): If it's a true merger with no money changing hands then the new carrier would be very solid.

There has never been a" true" merger in the airline industry. someone has always bought someone else.

Quoting B6FA4ever (Reply 32): wouldn't that have to be the case anyhow more particularly with United's valuable NRT 5th freedom rights? i remember someone mentioned in another thread regarding a NW/DL team-up and the NW name would somehow have to remain if they wanted to keep the NRT hub. otherwise all those NRT slots would go back into a pot for the grabbing and the 5th freedom rights would no longer apply.

That is just A. net myth. Think about it, was United born with the rights?

I say bring back the "Keep Delta My Delta" buttons

Ed Bastian just issued a statement denying that DL and UA are actively discussing a merger:

http://www.ajc.com/business/content/...stories/2007/11/14/delta_1115.html

Bastian:

Quote: We have no negotiations ongoing," said Delta President Ed Bastian. However, he said the rise of crude oil and jet fuel prices to near-record levels "changes the model," and that Delta will welcome a merger in which it emerges as an acquiror with little additional debt.

I reiterate my opinion that this was some joker at an investment bank floating a wishful-thinking trial balloon.

Edited to add the relevant quote.

[Edited 2007-11-14 12:25:47]

Quoting Hoya (Reply 33): The US Government will need to approve. Just like with UA/US proposed merger, the combined DL/UA would cause monopoly issues (ORD 'slots', DCA slots due to IAD hub, three hubs on east coast, ect)

There really would not have been any US/DL merger difficulties. I don't think there would be too much here.

The Interesting point of all of this is the DEN/SLC overlap. NW, DL and CO have all inquired about DEN as a hub if UA ever went under. I wonder if UA would consider selling off it's DEN hub to CO or NW (a CO/NW merger becoming inevitable if DL/UA goes through) and just focusing on SLC. I doubt they could sell SLC off.

Quoting FlyTUITravel (Reply 55): If Delta and United merge, its pretty obvious UA won't leave Star which is pretty darn frustrating. Star is big enough already IMO and although it wouldn't happen, I'd love to see the merged airline leave Star, even if it means leaving Skyteam as well because I would just hate to see Star get even bigger.

Why would a merged DL/UA need any alliance? Combined, they basically have global route authorities.

Quoting DL787932ER (Reply 64): I reiterate my opinion that this was some joker at an investment bank floating a wishful-thinking trial balloon.

Good to know. It didnt seem quite right.

Quoting CV880 (Reply 66): Why would a merged DL/UA need any alliance? Combined, they basically have global route authorities.

Even a merged UA/DL doesnt reach places like Valencia, Spain or Lyon France without a partner

Quoting Flyf15 (Reply 4): Good luck to CVG, SLC, and IAD if this happens....

UA really cashes in at IAD. In fact, whoever can get Feds from A to B will cash in with the Gov't contract (and the increasing population). Really, that's what GSA looks for and UA rakes in tons of money. If they go elsewhere anyone with some airplanes and three brain cells will have the good sense to fill in the gap.

Seems that most here are certain that UA will be running the show... I'm not too certain about that. Since the US offer, DL mgt has been all about themselves demanding that they are in the driver's seat. Perhaps just a front? Thoughts?

Quoting AirFRNT (Reply 65): There really would not have been any US/DL merger difficulties. I don't think there would be too much here.

Again a completely ignorant statement from someone who wasnt paying attention in 2000-01 during the US/UA merger...there will be significant hurdles to implementing this.

Quoting EXAAUADL (Reply 44): I dont understand why some here at A.net, unless they are hedge fund managers, this this is a good idea....it is a herrendous idea. sit cuz mergers are exciting and you need some excitement in your life?

Which is why a huge hedge fund that has 7 million shares in DL is pressuring them to consolidate with someone?

Riiiiiiight.

Personally, I don't think these two airlines are well matched and I agree with other posters who suggested that there are better options for both airlines. That said, let's look at how it might work out, fleetwise.

As far as I can see, the only commonality between them is on 757 (both PW powered) and 763ER (some DL are PW powered). The 777s have different engines, although I guess that's surmountable, if they both stick to their own bases. In time, I guess they can bring the fleets closer together, but with such a huge fleet, that would take until the middle of the next decade. They'd both want to stick with a single fleet.

Both are likely customers for the 787; a combination of -8s, -9s and -10s could replace the 763s, 764s and 777s in due course, although UAL would probably want something a little larger; the deal would have to be approved in Europe and while nothing would be said officially, I would be surprised if it weren't hinted that an Airbus order - somewhere along the line - might "incentivise" approval or "accelerate the process".

Midsize, yes, commonality on 757s - a total fleet of about 150, give or take, but these aircraft aren't getting any younger. For the moment, at least there is some commonality. Given fuel costs and the increasing pressure on airport slots, I expect the trend to be towards larger models, so UniDelta would probably be at the top of the queue for an aircraft in the 757's size category, maybe some 787-3s for domestic use too?

The smaller types ... that's where they divide quite significantly; no commonality: 733/735s and A32xs at UA and 737-800s and MD88s (plus 73Gs to come). Really, the most likely outcome, I would think, would be for both carriers to get on board with Boeing and help develop the 737 replacement; Boeing has indicated splitting the new model into two sizes, the second being aircraft of the 150-200 seat size (presumably in various models); I have an inkling, without any foundation, that Boeing and Bombardier will come to some agreement on the new C-series aircraft.

Workable from the fleet perspective, over a long period of time, but as said above, both airlines probably have better options. At least the ball is rolling anyway ...

Quoting EXAAUADL (Reply 70): Again a completely ignorant statement from someone who wasnt paying attention in 2000-01 during the US/UA merger...there will be significant hurdles to implementing this.

A lot has changed in the airline industry in 6-7 years, mostly for the worst. I think the DOJ and the SEC will be much more receptive this time around.

THIS IS THE MAIN POINT HERE:


This merger isnt being driven by people who have the airlines' best interest at heart. Even the worst most incompetent mgmt would be better than Pardus Capital. This is being driven by people who want to dump their poor investment and they could careless what happens after the merger is complete and they have bailed out.

Quoting Bobnwa (Reply 62): There has never been a" true" merger in the airline industry. someone has always bought someone else.

While the US airline industry may, or may not ( I can't think of any either) have had any true mergers it is certainly unprecidented internationally or in other industries. No reason it couldn't happen if the shareholders of both companies feel their shares' value is maximized via a merger where no cash changes owners.

Quoting DeltaRules (Reply 49): 777 (both, DL has more coming)

DL operates RR powered 777-200/ERs, has GE powered 777-200/LRs on the way. United operates PW powered 777-200s and 777-200/ERs.

Combined, UA/DL would operate 5 configurations of 777-200s, with four engine variants manufactured by all three makers.

Quoting DeltaRules (Reply 49): 764 (DL) 763 (both)

Delta flies GE and PW powered birds, United's 767 are powered by PW engines.

Quoting DeltaRules (Reply 49): 757 (UA RR powered, DL PW powered)

DL and UA's 757s are all PW powered, and all but the ex-TWA 757s have the same cabin layout. About the only fleets that are common

Quoting DeltaRules (Reply 49): 738 (DL) 73G (to be delivered to DL) 733/735 (UA) A319/320 (UA) MD-88 (DL)

The 733/735s are retired, DL MD-90s are mothballed, A319s/A320s, MD-88s and 737NGs make up the backbone of the narrowbody fleet.

This'll be a real messy merger fleetwise.

Quoting BigGSFO (Reply 36): They've already stated HQ will be in Chicago. The staff in Atlanta will be the losers.

Operational HQ will be in ATL, which is the majority of staff. Corporate HQ in downtown CHI would remain.

Obviously, there would be job cuts in both cities.

Quoting NW748i (Reply 69): Seems that most here are certain that UA will be running the show... I'm not too certain about that. Since the US offer, DL mgt has been all about themselves demanding that they are in the driver's seat. Perhaps just a front? Thoughts?

If any of this is true, just because there is speculation that the carrier would retain the United name (which i believe it would) or that the HQ would be in Chicago does not mean that the majority of the management team wouldn't be Delta. In addition, even if HQ isn't in Atlanta, that city would still have the same if not more service by the combined entity. The worse case scenario for ATL would be the loss of a couple of hundred management jobs.

Quoting 777STL (Reply 73): A lot has changed in the airline industry in 6-7 years, mostly for the worst. I think the DOJ and the SEC will be much more receptive this time around.

And this merger will somehow "fix" the airlines problems.....it wont, it will make them worse. Why dont you se ethat this is being driven by Pardus Capital who doesnt care about hte longterm future of DL/UA but only wants to see the stock get sa speculative bump sdo they can bail...why is that so difficult to understand???

Quoting DeltaRules (Reply 49): Surprised nobody's speculated about fleet combination yet: Here's what each operates at a glance: 744 (UA) 777 (both, DL has more coming) 764 (DL) 763 (both) 757 (UA RR powered, DL PW powered) 738 (DL) 73G (to be delivered to DL) 733/735 (UA) A319/320 (UA) MD-88 (DL) Fire away.

Just for shits and giggles, ok..

The 744s will stay with maybe a long range plan to replace them with 77Ws
All 777s will stay, and UA will still receive DL's 77Ls
The 764 is gone, probably to CO.
All 763s will stay.
All 757s will stay.
All 737NGs will stay, the 733s and the 735s will get axe.
The 319s and 320s will stay for the interim, though a replacement will be needed eventually as these are older.
The MD88s are kaput as well.

Quoting EXAAUADL (Reply 79): And this merger will somehow "fix" the airlines problems.....it wont, it will make them worse. Why dont you se ethat this is being driven by Pardus Capital who doesnt care about hte longterm future of DL/UA but only wants to see the stock get sa speculative bump sdo they can bail...why is that so difficult to understand???

Since you have all the answers apparently, how will this hurt the airline industry as a whole?

Any merger will most likely lead to a contraction in the combined entity once the fleet situation is worked out, redundant routes are pulled, and not to mention any DOJ anti-trust stipulations are put in effect. Contraction would help reduce some of the capacity issues the industry is having.

Tell me, do you work for DL?

Quoting NW748i (Reply 69): UA really cashes in at IAD. In fact, whoever can get Feds from A to B will cash in with the Gov't contract (and the increasing population).

I think you're right. IAD's O&D to Europe is substantially higher than ATL's, and in terms of hub locations, it's pretty much a wash. I think ATL winds up losing a lot of flights to secondary European markets if the merger goes through. ATL will retain its service to primary European markets (London, Paris, Frankfurt, and maybe another partner hub or two), and flights to most of the tertiary markets (KBP, etc.) will remain at JFK because that's the only market in the U.S. that can support them, but it would make much more sense to make ATL a hub for travel to Latin America and IAD the Europe hub.

Quoting 777STL (Reply 80): The 764 is gone, probably to CO.

I wouldn't be so sure about that, as United doesn't have an aircraft with a capacity between the 767-300 and 777-200, unlike NW, who operates A330s. Either way, I still don't support a DL/UA merger. DL/CO is the only way to go IMO.

According to CNBC @ 15.45ET, Anderson @ DL says that there are no talks with UA....


So much for today's merger.

Quoting 777STL (Reply 81): Any merger will most likely lead to a contraction in the combined entity once the fleet situation is worked out, redundant routes are pulled, and not to mention any DOJ anti-trust stipulations are put in effect. Contraction would help reduce some of the capacity issues the industry is having.

what a joke!!!! and hwo exactly will the excess capacity reductions remain reduced??? There is no regulatory authority to prevent excess capacity from coming back...that is one of the great myths of mergers, they result in a permanent reduction in capacity...let me ask you...do you work for Wall Street, since youre so keen on Pardus evidently knowing what is best for the industry.

Why not let failing airline fail??? That would give you your precious capacity reduction.

Quoting RDUDDJI (Reply 47): Quoting EXAAUADL (Reply 12): UA wasted precious time in 2000-01 to adjust to the economic downturn pre-911, with the moronic UA/US merger..this will be at least 2x as difficult.

From your profile, you must have been a very wise 6-8 years old then!  

Quoting EXAAUADL (Reply 1): Prediction: This goes nowhere.

You feel comfortable making a prediction on an Investment Banking transaction?

Quoting EXAAUADL (Reply 9): It doesnt...the story is interesting

'Having legs' means that the story is interesting !

Quoting EXAAUADL (Reply 9): Looks like UA mgmt mostly gets to run the airline.

Actually, Pardus wants DL mangement to do that.

see today's FT( Financial Times) for the best coverage:

http://www.ft.com/cms/s/0/6451cf9e-9...9-0000779fd2ac.html?nclick_check=1

Incidentally, CNN says DL is denying that it is in talks with UA....

Delta just came out and said this is Bulls**t

...Or not? "Delta Air CEO says not in merger talks with United Airlines"


http://www.marketwatch.com/News/Stor...8D73F0C0A%7d&siteid=yhoo&dist=yhoo

Quoting Comorin (Reply 86): 'Having legs' means that the story is interesting !

no it doesnt..."have legs" means there is something substantial to the story....

Quoting EXAAUADL (Reply 85): what a joke!!!! and hwo exactly will the excess capacity reductions remain reduced??? There is no regulatory authority to prevent excess capacity from coming back...that is one of the great myths of mergers, they result in a permanent reduction in capacity...let me ask you...do you work for Wall Street, since youre so keen on Pardus evidently knowing what is best for the industry.

It's common sense and the nature of the market itself would keep a merged airline from blowing up in size. Nevermind the fact that I have a feeling the DOJ would issue some anti-trust stipulations, i.e. dumping slots, routes, and maybe even a hub or two. Merged airlines don't typically retain the size of the sum of their parts for an extended period of time, history disagrees with you.

Quoting 1337Delta764 (Reply 83): I wouldn't be so sure about that, as United doesn't have an aircraft with a capacity between the 767-300 and 777-200, unlike NW, who operates A330s. Either way, I still don't support a DL/UA merger. DL/CO is the only way to go IMO.

Doesn't UA use their 772A's in much the same way DL uses their 764s, i.e. shorter international ops, Hawaii routes, etc?

Quoting Sxf24 (Reply 29): Outside of the inter-mountain west, there is very little overlap in route systems. The International networks are very complimentary and the combined carriers would have very strong positions in the largest O&D markets. The biggest losers would be UA staff in Elk Grove, DL FAs, SLC and the regional carriers.

That's a major factor that concerns me. The intermountain west will be hurt really bad by such a transaction. Places like Montana, Wyoming, the Dakotas, Idaho will see service plummet, and fares skyrocket. Definitely bad news for people in my hometown.

Quoting 777STL (Reply 90): It's common sense and the nature of the market itself would keep a merged airline from blowing up in size. Nevermind the fact that I have a feeling the DOJ would issue some anti-trust stipulations, i.e. dumping slots, routes, and maybe even a hub or two. Merged airlines don't typically retain the size of the sum of their parts for an extended period of time, history disagrees with you.

History supports me, not you.....other carriers come in with lower costs and can grow where the merged carrier has retrenched..example WN growing in CA after US/PS and AA/OC....thus there is no reduction in capacity...teh airline industry is chronically overcapicty in part due to ease of entry and difficulty of exit..a merger wouldnt help that preoblem on iota.

Actually your description of the merged carrier sounds monoploistic, thus it should be rejected.

Quoting Airstud (Reply 39): I am not going to allow a reduction in number of airline paint schemes currently plying the skies

It would be catastrophic, to lose UA's 2 schemes and DL's 9 schemes ! Quelle tragedie !   

Quoting EXAAUADL (Reply 74): This merger isnt being driven by people who have the airlines' best interest at heart. Even the worst most incompetent mgmt would be better than Pardus Capital. This is being driven by people who want to dump their poor investment and they could careless what happens after the merger is complete and they have bailed out.

Agreed. Great point.

As has been previously stated on here, I think that the recent AF/DL moves make a DL/UA merger quite suspect. I think that this is all just something concocted by the institutional stockholders to get themselves out of a risky investment.

Does anyone that follows Target Corp. stock remember a very similiar story about a hedge fund manager who bought something like 8% of Target stock so he could try to influnce them to sell of thier real estate? Of course that would have raised BILLIONS of $$$, but it wouldn't have helped Target Corp at all...but in the ensuing mess, the stock price would have gone through the roof on the short term and this hedge fund guy would have made a boatload of money. This seems very similiar to me...but hey, what do I know? I'm certainly no economist.

Quoting 1337Delta764 (Reply 83): DL/CO is the only way to go IMO.

Why do you say that? There is an awful lot of overlap with CO and DL is there not?

I think it is fair to say that no merger is going to be easy, and we shouldnt be jumping to conclusions after statements by a hedge fund. In terms of route networks, UA and DL complement each other better than any other airlines IMHO. One of the biggest issues has to be of course staff integration - especially after all the Keep Delta My Delta stuff. How much concern is there from investors pushing this about what the rank and file think? All the synergies in the world wont mean squat if the guys that work for the airlines put up a fight and make things real messy!

It must be a Red Herring......

http://www.wsbtv.com/tu/5tlWbTLpN.html

Quoting 777STL (Reply 90): Doesn't UA use their 772A's in much the same way DL uses their 764s, i.e. shorter international ops, Hawaii routes, etc?

Yes, but the 777-200A is still a larger aircraft, and since the 767-400ER has more range, it is a more capable and appropriate aircraft for Delta's uses. Delta is largely shifting their 767-400ERs to international ops, so perhaps the 777-200As could be restricted on domestic leisure routes (i.e., Hawaii, Florida, etc.), while the 767-400ERs could be used on transatlantic and South American routes, where a 777 might be too large.

Quoting Itsonlyme (Reply 95): How much concern is there from investors pushing this about what the rank and file think?

zero.

Quoting Itsonlyme (Reply 95): All the synergies in the world wont mean squat if the guys that work for the airlines put up a fight and make things real messy!

gonna be hard to generate employee support. Even the most complimentary of mergers between legacies will result in airplanes being parked and employees being furloughed.

To reiterate for those who refuse to read:

THERE ARE NO MERGER TALKS BETWEEN DELTA AND UNITED TAKING PLACE.

However, given Delta's press release on the denial, it does appear that Delta MAY be in talks with some other airline, as the release denies talks with United, but does not deny talks with any other carrier.