I came across this article at the Huffington Post (via the http://www.huffingtonpost.com/huff-w...s-american-airlines-ceo-interview/

Regards to all,
Tony

[Edited 2012-07-25 10:21:52]

The link you have included is broken.

Pretty much what I expected, and what he said makes a lot of sense. If I'm an AA creditor and I know the airline is getting stronger and would emerge a lean competitor from BK, I'd vote against the merger...as Horton pointed out, it would bring better value to me as a creditor in the long-term if AA is able to negotiate from a position of strength.

I thought that the creditors ultimately decided if AMR's reorganization plan would be allowed to bring the company out of BK, not Horton himself. Or am I misunderstanding bankrupcy laws?

LCC should get its chance to present its plans in court. Being as they are also trying to influence the creditor's committee, wouldn't it make sense for that committee to hear out US Airways plan....at some point?

A merger with US would not be good for AA IMO. The airline would simple degrade down to a large version of US, which I would see as a big drop in service.

Quoting catiii (Reply 1):

I see that now. My sincerest apologies. I posted, then did a small edit, and somehow the whole thing got messed up -- all while I drove to work and so I can't re-edit. Please forgive me.

And THANK YOU to Polot for reposting the correct link.

Best,
Tony

Quoting KDAYflyer (Reply 5): A merger with US would not be good for AA IMO. The airline would simple degrade down to a large version of US, which I would see as a big drop in service.

Which pretty much seems what the American consumer is willing to pay for anymore.

Well, it seems Horton used Parker as a catalyst to galvanize the resolve of AA to not merge with US after their talk. Every story needs to have a good guy and bad guy. I wonder, if this is totally true about the meeting, how Parker feels about Horton's actions?

Horton says that the views of Union leadership on a US merger do not reflect the employees of AA. Any AA front liners here wish to comment on this.

As an outsider it seems like HQ is trying to start something similar to Keep Delta My Delta, however it seems like it is falling flat.

Quoting lasairlinerenth (Thread starter):

Duh. they merge with US before they get out of BK, Horton may not get his big bonus.

Quoting flyingcaT (Reply 9): Horton says that the views of Union leadership on a US merger do not reflect the employees of AA. Any AA front liners here wish to comment on this.

Rolmfao....right because Horton seems to have such a handle on what his employees want.

Quoting BlueDanube (Reply 4): I thought that the creditors ultimately decided if AMR's reorganization plan would be allowed to bring the company out of BK, not Horton himself. Or am I misunderstanding bankrupcy laws? LCC should get its chance to present its plans in court. Being as they are also trying to influence the creditor's committee, wouldn't it make sense for that committee to hear out US Airways plan....at some point?

He has some influence in the proceedings and is closer to the situation the the shareholders, and is why shareholders don't run the day to day operations of the airline.

Quoting DeltaL1011man (Reply 10): Horton may not get his big bonus.

And that may be the main issue right now IMHO....AA sr mgt may lose out in a merger instead of splitting new shares in a reorg AMR....that means that the line employees could be a pawn in a high level mgt slugfest over bonuses. I surely hope that I am completely wrong....but it doesn't seem to be trending that way with these last few statements from both Parker and Horton.

Quoting BlueDanube (Reply 4): I thought that the creditors ultimately decided if AMR's reorganization plan would be allowed to bring the company out of BK, not Horton himself. Or am I misunderstanding bankrupcy laws? LCC should get its chance to present its plans in court. Being as they are also trying to influence the creditor's committee, wouldn't it make sense for that committee to hear out US Airways plan....at some point?

Under the bankruptcy code, the debtor has an exclusive period to formulate a plan of reorganization and present it to the court and creditors. The exclusive period now runs until December 29, absent any further extensions by the court.

If the plan is ultimately approved by a majority of the creditors' committee and the judge, then AMR will exit bankruptcy.

While the unions of AA have 1/3rd of the votes on the committee, AMR only needs a majority. So, it banks, the PBGC,and Boeing believe that AMR will be better off with the plan that the company presents, then US Air's plan will never see the light of day.

That's just how bankruptcy works.

From the linked article:

"There's an unspoken incentive for Horton to bash US Airways and quash merger speculation – drive down his rival's stock price and make a merger less expensive."

Reason enough right there.

Horton really has the nerve to say all this after AMR/AA merged with three airlines, Air Cal, Reno Air and TWA. AMR & AA dismantled and destroyed what they had, along with taking the moral of many employees who were part of these merger deals and putting them in the toilet.
He approached B6 and AS, and they turned him down! Good for them. They know all to well how AA does when they are the one's calling the shots in a merger! Yahoo article link: http://finance.yahoo.com/news/americ...o-bashes-us-airways-154508886.html
Perhaps Horton should find employment over at Spirit. This guy needs to be humbled.

Quoting laca773 (Reply 15): Perhaps Horton should find employment over at Spirit. This guy needs to be humbled.

Very smart guy. Hasn't just proven himself in the airline business. He doesn't need to be humble. He's got the resume.

If he is making his case now, it must mean that he's confident in the outcome.

Quoting laca773 (Reply 15): Horton really has the nerve to say all this after AMR/AA merged with three airlines, Air Cal, Reno Air and TWA. AMR & AA dismantled and destroyed what they had, along with taking the moral of many employees who were part of these merger deals and putting them in the toilet.

Wait a minute, you do know all of that happened before Horton was the CEO of AMR, don't you? He became the CEO the same day AA entered bankruptcy, and has only been there for about 8 or 9 months.

This is all posturing. Leehmam talks about AMR's "Goofy" merger explorations. US posted impressive profits today and is on solid financial footing with good management. AA has made a lot of announcements about improved performance and products, but the fact remains that AA will still be well behind Delta and United without a merger partner. It is all about who will run the show once a merger happens. I think that in a day or so Parker will come out with something that will make Horton look silly--once again. http://leehamnews.wordpress.com/

Quoting laca773 (Reply 15): Perhaps Horton should find employment over at Spirit. This guy needs to be humbled.

Sorry, no can do, Spirit is in the business of making money, not losing it for an entire decade....

This hostile takeover attempt is losing momentum by the second. Which isn't to say AA and LCC won't eventually merge at some point, i still think it'll happen at some point, but Parker won't be the one calling the shots.

Ray Neidl, the Maxim Group airline analyst who met Parker and Horton at their much ballyhooed breakfast last week said he was swayed by Horton's determination to keep American independent.

"I reduce (the) odds of a meger happening from 90 (percent) to less than 50" he said.

Another analyst, Helane Becker from Dahlam Rose, noted that "it's more important for US Airways to do the deal than it is for American."

I find it disgraceful how in a matter of weeks Dougie was able to come to agreements with all of AA's unions and yet the majority of his very own airline is still working under a deplorable contract negotiated back in 2005.

If i were Doug i'd start looking at Alaskan or perhaps Frontier...AA has essentially told Dougie to go pound sand.

AA can say what ever the F they want . Doesnt mean it will work out in their favor .

Quoting AAplat4life (Reply 18): This is all posturing.

Yes, it all comes down to who will buy/merge with whom, how much it will cost, and who will be in control. US wants to be in control, in the pilots seat as it were, and they will only be able to be there if they can do what they are planning. Otherwise, after the bankruptcy is completed, it will be AA in control.

Tugg

Quoting etops1 (Reply 21): AA can say what ever the F they want . Doesnt mean it will work out in their favor .

Sure sounds as if Dougie and Co. have lost any momentum they might have had. Even analysts who once put merger prospects at 90% are now saying its less than 50/50.

Don't worry ETOPS1, you'll still be able to nonrev to Asia and Australia. You'll just have to buy ZED tickets like all LCC employees do LMFAO!!!

Quoting flyingcaT (Reply 9): As an outsider it seems like HQ is trying to start something similar to Keep Delta My Delta, however it seems like it is falling flat.

I think what Parker probably needs to worry about more now are top-tier AA frequent flyers staging a "Keep AA My AA" campaign. I can envision an online petition with thousands of people - most of them airline buffs but many probably actual, high-spend AAdvantage members - supporting AA's product/service standards (as-is, and what's to come) and issuing a threat (in most cases hollow, but still) to defect if AA "goes USAirways."

In the long-run it would surely amount to little, and not mean much, but I doubt it's what Parker would want to see right now as he tries to convince creditors and stakeholders that he can take over AA and merge it with USAirways without driving away the high-value customers that AA currently attracts, and USAirways - at least to a certain extent - currently lacks.

Quoting lucky777 (Reply 20): Another analyst, Helane Becker from Dahlam Rose, noted that "it's more important for US Airways to do the deal than it is for American."

And that, right there - I think - is the key. Many have long recognized it, and now that the initial aura of Parker's P.R. blitz has worn off, many more are coming to recognize it, too. USAirways does need this deal more than American does. While many - myself included - agree that an independent, post-bankruptcy AA will be at some competitive disadvantage, at least in terms of network scope and breadth, relative to Delta and United, I think there are few who seriously expect AA to be at any major competitive disadvantage to USAirways. In other words, I don't think there are many who truly believe post-bankruptcy AA will be in any worse shape than USAirways is in now. Indeed, it seems the unions are concerned - perhaps fairly - that AA will actually be excessively profitable because of the (from their perspective) unnecessarily extreme concessions AMR is seeking from the union work groups.

USAirways results today were impressive - and indicate, again, that Doug Parker has managed to turn a structurally disadvantaged airline into a profitable entity largely through doing precisely what AMR's unions accuse Horton of trying to do now: locking them into a low-cost contract for as long as possible, and outsource as many of them as possible. The irony is thick. He has had success in this regard to-date. Meanwhile, it does appear - at least on the surface - that AMR is beginning to pick up some momentum in their restructuring process, with a massive new fleet on the way, an apparently highly successful program to poach high-value United FFs, and financials rapidly improving - all before AMR has even gotten to address the single largest structural competitive impediment they have faced for years: the union contracts (with most of the uncompetitiveness coming from the pilots' contract, to a lesser extent some from the TWU, and almost none at all the flight attendants). We'll all get to see how things continue to progress - good or bad - over the next few months.

So with all that being said, while I think many of Parker's observations and statements about the strategic state of AMR, and the industry and competitive landscape, etc. are true - i.e., that the combined "new AA" would be stronger in several key regions, that the combined hubs/routes are highly complimentary, etc. - I think Horton's observation in the above-linked article is also equally accurate. Specifically, Parker is, indeed, in a "race against the clock to somehow increase revenue before he has to pay higher salaries in a new contract." Witness his ability to cut non-binding deals with another airlines' unions in two weeks while, to the chagrin and frustration of his own unions, they still don't have new contracts after 5+ years. Parker knows that math just as well as Horton does, which is why both of them, to a certain extent, are correct in what they are saying.

Quoting etops1 (Reply 21): AA can say what ever the F they want . Doesnt mean it will work out in their favor .

Two-way street. There is plenty of spin, "posturing," and hyperbole going around from all sides. Those supportive of, and/or with a vested interest in, this merger are talking it up as if it's already a certainty. Those opposed to, or with a vested interest against, this merger are downplaying it as impossible. The truth is likely somewhere in the middle.

Personally, regardless of what anybody here on A.net or anywhere else says, I still don't think this merger - right now, under these circumstances - is a done deal. I continue to believe that the chances of AMR and USAirways merging is at nearly 100%, but that the chances of that happening while AMR is in bankruptcy are somewhere less than 100%. It may happen, it may not - at this point, I think it could go either way. As I said several weeks ago, I think Horton need not convince the stakeholders involved that a merger is a bad idea, but only that a merger is a bad idea now. Will he be able to do it? I don't know. It will be interesting to watch.



[Edited 2012-07-25 18:34:24]