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US Airways cancels Delta acquisition


monsoon

Which Southern Hub will they Keep?  

93 members have voted

  1. 1. Which Southern Hub will they Keep?

    • Atlanta Hartsfield
      51
    • Charlotte Douglas
      9
    • Both Hubs will remain
      33


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The Charlotte Observer has posted a good article that answers most of the questions posed in this thread today:

http://www.charlotte.com/mld/charlotte/16021603.htm

Some of the main points:

US Airways President Scott Kirby stated that Charlotte would retain all of its current non-stop destinations in the merger. That it would remain a "robust" hub. However there would probably be some flight reductions...for example Asheville could go from the current 8 daily non-stops to 4. He also said that some smaller planes based in Atlanta would be moved to Charlotte.

Some of the analysts interviewed said that for the first couple years of the merger Charlotte may be able to hold onto its status as a hub, but after that to expect big cuts here.

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The article said this about those statements from the USAir president.

Analysts said that's unrealistic.

I think it is becoming pretty clear that Charlotte will lose out on this deal. I do agree that Charlotte will most likely end up with something like 200 flights/day and mostly shorter haul stuff and maybe the mini Carribean hub. I can see them keeping the plane maintenance stuff here too.

I guess they ought to rethink the planned airport expansion.

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The more I think about it, if US Airways/Delta are forced to relinquish it's CLT hub for competitive reasons the airport expansions might be the saving grace for Continental or United to pick it up. CLT does have very low fees for airlines but that would change over night if fewer flights are using it. If the O&D stats were better for CLT I wouldn't worry about it and call CLT safe no matter who it is because it's a great airport, but that is not the case with 90% of passengers connecting.

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Also to add to that, USAir is looking to replace their 737 fleet in the next few years, so its quite possible they could select an aircraft that would share commonality with Delta's 737s. They have indicated that in today's conference calls that they are in negotitation with Boeing about those new planes. This is something that USAirways is doing regardless of the Delta merger.
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The article said this about those statements from the USAir president.

Analysts said that's unrealistic.

I think it is becoming pretty clear that Charlotte will lose out on this deal. I do agree that Charlotte will most likely end up with something like 200 flights/day and mostly shorter haul stuff and maybe the mini Carribean hub. I can see them keeping the plane maintenance stuff here too.

I guess they ought to rethink the planned airport expansion.

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Trust me, the only reason Doug Parker is saying CLT will remain a hub after the merger is not to cause too much anxiety or a revolt against US Airways up until the deal is done if it ever will be. If that day ever does come, one of the first things they will do is axe CLT for a much larger and better operation in ATL.
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Here are some interesting stats on O & D traffic for CLT. It might shed some light on what non-stop flights CLT could support without a hub and spoke operation.

Flights Miles Daily Passengers

Charlotte, NC and Akron/Canton, OH 394 18

Charlotte, NC and Albany, NY 645 89

Charlotte, NC and Albuquerque, NM 1,450 63

Charlotte, NC and Allentown, PA 480 49

Charlotte, NC and Appleton, WI 742 12

Charlotte, NC and Atlanta, GA 227 274

Charlotte, NC and Austin, TX 1,033 68

Charlotte, NC and Baltimore, MD 360 198

Charlotte, NC and Bangor, ME 920 11

Charlotte, NC and Billings, MT 1,616 14

Charlotte, NC and Birmingham, AL 352 126

Charlotte, NC and Boise, ID 1,958 20

Charlotte, NC and Boston, MA 727 381

Charlotte, NC and Bozeman, MT 1,737 10

Charlotte, NC and Buffalo, NY 546 93

Charlotte, NC and Burlington, VT 760 30

Charlotte, NC and Cedar Rapids/Iowa City, IA 742 15

Charlotte, NC and Charleston, SC 168 15

Charlotte, NC and Charlottesville, VA 244 24

Charlotte, NC and Chattanooga, TN 242 19

Charlotte, NC and Chicago, IL 599 1,059

Charlotte, NC and Cincinnati, OH 335 95

Charlotte, NC and Cleveland, OH 430 144

Charlotte, NC and Colorado Springs, CO 1,334 19

Charlotte, NC and Columbus, OH 346 97

Charlotte, NC and Dallas/Ft. Worth, TX 937 457

Charlotte, NC and Dayton, OH 370 50

Charlotte, NC and Denver, CO 1,338 342

Charlotte, NC and Des Moines, IA 815 54

Charlotte, NC and Detroit, MI 500 251

Charlotte, NC and El Paso, TX 1,483 15

Charlotte, NC and Erie, PA 475 12

Charlotte, NC and Evansville, IN 415 11

Charlotte, NC and Fayetteville, AR 754 30

Charlotte, NC and Flint, MI 555 34

Charlotte, NC and Ft. Lauderdale, FL 632 300

Charlotte, NC and Ft. Myers, FL 600 99

Charlotte, NC and Ft. Wayne, IN 460 28

Charlotte, NC and Gainesville, FL 389 17

Charlotte, NC and Grand Rapids, MI 583 58

Charlotte, NC and Green Bay, WI 744 18

Charlotte, NC and Greenville, NC 202 15

Charlotte, NC and Harrisburg, PA 412 34

Charlotte, NC and Hartford, CT/Springfield, MA 643 211

Charlotte, NC and Houston, TX 921 219

Charlotte, NC and Huntsville/Decatur, AL 334 43

Charlotte, NC and Indianapolis, IN 428 172

Charlotte, NC and Jackson, WY 1,686 18

Charlotte, NC and Jackson/Vicksburg, MS 563 23

Charlotte, NC and Jacksonville, FL 329 111

Charlotte, NC and Kansas City, MO 809 161

Charlotte, NC and Key West, FL 736 17

Charlotte, NC and Knoxville, TN 177 11

Charlotte, NC and Lansing, MI 557 14

Charlotte, NC and Las Vegas, NV 1,917 435

Charlotte, NC and Lexington/Frankfort, KY 282 29

Charlotte, NC and Little Rock, AR 641 45

Charlotte, NC and Los Angeles, CA 2,125 450

Charlotte, NC and Louisville, KY 336 66

Charlotte, NC and Madison, WI 708 40

Charlotte, NC and Manchester, NH 737 138

Charlotte, NC and Memphis, TN 512 95

Charlotte, NC and Miami, FL 651 319

Charlotte, NC and Milwaukee, WI 651 163

Charlotte, NC and Minneapolis/St.Paul, MN 930 302

Charlotte, NC and Mobile, AL 527 18

Charlotte, NC and Moline, IL/Davenport, IA 674 26

Charlotte, NC and Montgomery, AL 373 16

Charlotte, NC and Nashville, TN 329 240

Charlotte, NC and New Bern, NC 221 13

Charlotte, NC and New Orleans, LA 651 111

Charlotte, NC and New York, NY 543 1,206

Charlotte, NC and Newport News/Hampton/Wmsburg, VA 281 13

Charlotte, NC and Norfolk, VA 289 59

Charlotte, NC and Oakland/Berkeley, CA 2,287 87

Charlotte, NC and Oklahoma City, OK 941 36

Charlotte, NC and Omaha, NE 914 47

Charlotte, NC and Ontario, CA 2,079 191

Charlotte, NC and Orlando/Kissimmee, FL 468 360

Charlotte, NC and Pensacola, FL 489 50

Charlotte, NC and Philadelphia, PA 447 315

Charlotte, NC and Phoenix, AZ 1,774 216

Charlotte, NC and Pittsburgh, PA 366 167

Charlotte, NC and Portland, ME 812 54

Charlotte, NC and Portland, OR 2,282 65

Charlotte, NC and Providence, RI 683 159

Charlotte, NC and Raleigh/Durham, NC 130 22

Charlotte, NC and Reno, NV 2,141 32

Charlotte, NC and Richmond, VA 256 106

Charlotte, NC and Roanoke, VA 155 18

Charlotte, NC and Rochester, NY 572 63

Charlotte, NC and Sacramento, CA 2,244 39

Charlotte, NC and Salt Lake City, UT 1,727 58

Charlotte, NC and San Antonio, TX 1,096 62

Charlotte, NC and San Diego, CA 2,077 124

Charlotte, NC and San Francisco, CA 2,296 359

Charlotte, NC and San Jose/Palo Alto, CA 2,275 92

Charlotte, NC and Santa Ana, CA 2,099 78

Charlotte, NC and Sarasota/Bradenton, FL 548 59

Charlotte, NC and Savannah, GA 214 11

Charlotte, NC and Seattle, WA 2,279 284

Charlotte, NC and Sioux Falls, SD 1,021 11

Charlotte, NC and South Bend, IN 534 38

Charlotte, NC and Spokane, WA 2,060 16

Charlotte, NC and Springfield, IL 576 13

Charlotte, NC and Springfield, MO 709 13

Charlotte, NC and St. Louis, MO 575 191

Charlotte, NC and Syracuse, NY 603 63

Charlotte, NC and Tallahassee, FL 387 26

Charlotte, NC and Tampa/St. Petersburg/Lakeland, FL 508 346

Charlotte, NC and Toledo, OH 466 20

Charlotte, NC and Tucson, AZ 1,736 16

Charlotte, NC and Tulsa, OK 843 24

Charlotte, NC and Washington, DC 330 347

Charlotte, NC and West Palm Beach, FL 590 148

Charlotte, NC and White Plains, NY 563 10

Charlotte, NC and Wichita, KS 933 23

Charlotte, NC and Wilmington, NC 185 22

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I think this article from outside the USA sums up exactly why USAir is going after Delta and why, most likely, regulators will allow them to proceed with the merger. I think it puts to rest also the idea that idea this is a ploy that USAir is using to really get NWA. It sounds as if this has been going on for more than a month behind the scenes directly between the management of the two companies.

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US Air's CEO discussed the possibility of a merger last Spring. An outline of the proposition was made in September, and was subsequently rebuffed in October.

US Air is going after Delta, and has a good chance of succeeding. Charlotte should make plans for post US Air, even if it doesn't occur now it will be a good exercise. As for US Air, The company is doing its duty to improve shareholder value, it's a win for both Delta's creditors and US Air shareholders.

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There are still carriers that could make a bid on DL. Continental (CO), American (AA), and United (UA). Continental is the most likely, as it has the most to lose. We'll just have to wait and see. In the meantime, I think I'll cancel my US/HP transition training scheduled for mid-December.

I still have heard nothing from the company on how they plan to rationalize the fleet. As I said earlier, so many different pieces of equipment with so many different engines and parts will not be an inexpensive proposition.

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I've been thinking about this merger alot, and here is my analysis.....of course, since airlines aren't my specialty, I may be way off.

The only way this makes sense is if USAirways wants to bank on the future of S. American service. I don't see that service as a gold mine, and I don't see any advantage to this merger. The real growth opportunities are in international business travel, and USAirways has been able to organically grow their European service at a respectable rate. A merger with NWA makes much more sense, as NWA already has an extnesive Asian network, and flight times between MSP and most Asian destinations are comparable in flight time to LAX, PHX, or SLC.

I would think NWA would be more ammenable to an offer as well, as they face a very aging fleet (DC9s!!!) and are in need of some large cash infusion to satisfy all capital needs. Additionally, there are obviously far less hub overlaps, so the "synergies" are much more real in this circumstance, at least that's how I assume the DOJ will view it.

All that said, it appears that what USAirways means by "synergies" is that it will be eliminating a cheif competitor on a lot of routes, instead of finding a merger partner that will help it grow. In the short-term (3-5 years) it will probably play to USAirways advantage, but once they find themselves in the same position as they currently are (dominant east-coast carrier) and the temporary decline is supply has been replaced by true low costs carriers, they're back to where they are today, just with higher costs.

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Wow that's alot of news to swallow. I've been following this since I first heard about it a few months back. I work at Sky Harbor which is about two miles from USAirways headquarters. Someone said it earlier, and I just have to reinforce it. This is America West. This is not USAirways. America West bought USAir for a couple reasons. The biggest being, they wanted a bigger brand name that could give them more recognition, and market share. They are a pretty aggressive company, I'm sure if they have set out to do this they will find a way to get it done. The NWA thought is an interesting one. Definately a better thought for you all in CLT. I think it would supercharge the DTW and PHX locations, but cause little disruption at the other hubs. Even if Memphis suffered loss of NWA hub status, it wouldn't affect the airport to much. it serves only about 11million passengers a year, and is widely known as a cargo super hub.

However no matter what happens keep your chins up. In the off chance that CLT were to be downgraded to a focus city, it would have little impact on it economically. Maybe a small hit to it's pride. Most of the people passing thru the airport don't ever see the city. Aside from that it's still considered one of the fastest growing, and best places to do business in America. I hardly think a shift in airline traffic could change that.

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Wow that's alot of news to swallow. I've been following this since I first heard about it a few months back. I work at Sky Harbor which is about two miles from USAirways headquarters. Someone said it earlier, and I just have to reinforce it. This is America West. This is not USAirways. America West bought USAir for a couple reasons. The biggest being, they wanted a bigger brand name that could give them more recognition, and market share. They are a pretty aggressive company, I'm sure if they have set out to do this they will find a way to get it done. The NWA thought is an interesting one. Definately a better thought for you all in CLT. I think it would supercharge the DTW and PHX locations, but cause little disruption at the other hubs. Even if Memphis suffered loss of NWA hub status, it wouldn't affect the airport to much. it serves only about 11million passengers a year, and is widely known as a cargo super hub.

However no matter what happens keep your chins up. In the off chance that CLT were to be downgraded to a focus city, it would have little impact on it economically. Maybe a small hit to it's pride. Most of the people passing thru the airport don't ever see the city. Aside from that it's still considered one of the fastest growing, and best places to do business in America. I hardly think a shift in airline traffic could change that.

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According to all I am hearing, Charlotte has almost a 0% chance of losing its Hub status. The HUB status is important to the city and is sited as the NUMBER ONE economic catalyst to the city outside of the major banks. 6,000+ people work at USAir and more than ten (10) times this many people have ties to the airport in the some form of economic tie to the Hub and its operations.

The Hub status is more than just a Pride issue, it is an economic one.

Charlotte is the 6th largest distribution region in the US, and has only added to its already busy airport. The infastructure is vastly improved from just a decade ago, and the number of flights in and out of CLT have made it one of the businest in the US.

If Charlotte were to lose its status as a HUB, the number of flights would fall by 50% according to many analyst.

If there were ever any doubt about the status of Charlotte Douglas Int'l being a hub, then that will be the day you will see the city and state jump in (in a Big way). They understand the importance behind having the airport as a hub and its vitial role in the local and regional economy.

Let us also not forget that this is USAir's Biggest Hub and one of the busiest in the world. I am not suggesting we are of the same status as Atlanta or Chicago, just that currently it is the 32nd busiest in the world and 12th busiest by total operations in the US. That is noteworthy.

A2

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A2, reading your post makes it sound like our hub status is ours to lose. Charlotte doesn't get a say in that, unfortunately. I know a lot rides on our hub status, but that's really the effect, not the cause. While PIT did saddle US with high operational costs when they were a hub, remember that PA and Allegheny County did all they could to change USAirways' mind when they decided in large part to pull out, and it had zero effect. A lot of the time, I think we here get a little jaded because it often seems as though somehow at the end of the day 'Charlotte gets what Charlotte wants'. It's been nice to have things work out that way, but in this case, we may be in for a big reality check if this deal goes through (which, as I've stated many times I do NOT think will happen).

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A2, reading your post makes it sound like our hub status is ours to lose. Charlotte doesn't get a say in that, unfortunately. I know a lot rides on our hub status, but that's really the effect, not the cause. While PIT did saddle US with high operational costs when they were a hub, remember that PA and Allegheny County did all they could to change USAirways' mind when they decided in large part to pull out, and it had zero effect. A lot of the time, I think we here get a little jaded because it often seems as though somehow at the end of the day 'Charlotte gets what Charlotte wants'. It's been nice to have things work out that way, but in this case, we may be in for a big reality check if this deal goes through (which, as I've stated many times I do NOT think will happen).
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I think the state and city would have some intervention if (and that should be a BIG if) Charlotte were in jeopardy of losing its Hub status.

I imagine millions would be offered up in tax incentives just to make sure that the company really understood the idea that we were not willing to let such a jewel go.

A2

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