USAirways bid for Delta

[MJLO]

Republic story in the news. Obviously Delta is a bigger airline than USAir. So merging the airlines would mean extra office space somewhere. Personally I'd like to see the new airline stay in Arizona. I'm pretty sure the merger would create something like the worlds largest airline. To have a company stay in Phoenix would mean a great deal for the economy. Especially in a city where virtually no Major corporations exist. It says the new company would be the largest public company in Arizona. Revenues at around 26 billion. I guess Georgia officials are up in arms over the deal. Which would make sense. Being from Michigan, if there were a take over of NWA, and Detroits status as a megahub were threatened, I'd do every thing in my power to protect the economy.

Realistically, this is still in the initial stages. There's a good chance government agencies might find anti trust problems with the merger. So it's a little early to come to any conclusions. Phoenix would have a small advantage in being the hometown of the airline. I would love to see the merger go thru, and to see the headquarters stay in AZ. It would be just as cool, if the new airline needed more office space and built a nice signature building downtown. wink wink

[colin]

There's no way that they would give up Sky Harbor as a major hub. It's too busy and too important.

[MJLO]

It's not so much about PHX's hub status. That's concrete. They very well may be moving the Headquarters out of Tempe if the deal goes thru though. That's what it's about.

[MJLO]

More on the fight between Delta and USAirways Delta is fiercely fighting the Hostile bid, USAirways is remaining persistent however. Ofcourse company officials will sound confident on both ends. With what you all know about business knowlege, do you think that USAir will be successful with it's buyout, and if it is, Do you think that the new Delta Airlines will move it's headquarters to Atlanta?

On a childish bias note, I'd like to see them remain here in part because, yay I live here, i'm all about it becoming the largest corporation in AZ. But also, I think Atlanta has to much capital in the way of big companies, and I don't think it would hurt it to lose one.

[Manolos]

I think it the USAirways plan to takeover Delta was poorly constructed and thought out. USAirways is still integrating America West into its flight patterns and still is not completely efficient. I personally hate flying USAirways. No food, poor service and no movies. I prefer Continental.

[MJLO]

I have never flown USAirways, or America West, as they don't serve the parts of the country I travel to, at least not as cheap as Northwest does. I have however worked for Host Marriot at Sky Harbor for the past eight months and have heard more bad things than good about how the airline operates. I think that it's very possible the deal will go thru. If it's a numbers game, the USAirways deal has a better chance, since i'm sure creditors would like to see some of their money and this has $ involved. Although who knows what'll happen at the top and with the gov't in all of it.

What annoys me is the whole headquarters talk. If the merger does go thru, I forsee a bitter fight from GA about keeping the airline headquartered there. The state would stand to lose very little if it lost that headquarters. There's no way that Hartsfield would lose it's hub status and that's where the real money is. I'm pretty sure Atlanta has more corporate headquarters than most cities. They just want to keep their capitol, I'm thinking blow to the ego more than anything. Besides, perhaps it would slow that explosive growth they've been having, and not suck so many people out of my home state and like places.

[MJLO]

I read in the business section of USA Today, that Phoenix, has sweetened a deal for USAir to build it's flight operations center. Financial incentives, and it sounds like actual cash involved. What would this entail? Would all of this help keep the Airline headquartered here, if the Delta deal goes thru?

[colin]

Phoenix is just all about incentives.

I don't personally believe that this deal is going through at all, but, at the least, it would start an incentive war between the three cities.

The Daily Star had an article about this yesterday:

http://www.azstarnet.com/altds/pastframe/metro/162743

It's a shame that they have to compete at all, but this would certainly do a lot to stifle the Valley's rabid growth if they lost US Airways.

[MJLO]

I really wonder how much it could do. I mean how much valley growth is dependent on the Airline? There's no such thing as a major employer in Phoenix, it's definately a service based economy. It would sting a little if they left. But PHX's hub status wouldn't be threatened at all.

[colin]

Yeah, I would never worry about the airport. Someone will pick up the slack for sure; probably Southwest.

It's just having the corporate offices there make Phoenix (and especially Downtown Tempe) very reliant on the airline. You're right though, there's no big employer in town like there is here in Tucson, so most of the unemployment will simply be absorbed. However, I still think that it will impact the growth, if not directly by increasing the unemployment rate, then indirectly by blowing that Phoenix mystique as the place for a company to re-locate.

[MJLO]

Is that really the Phoenix mystique? I would be nice to see some substantial Corporate headquarters, instead a of a whole bunch of obscure little ones. But it's a good likeliness that the merger won't go thru, and nothing will change anyway.

[monsoon]

The Charlotte city council has said that it will not up it's bid to match Phoenix though they won't disclose what they have offered.

[markusparkus]

Delta will stand alone as its own airline, without the help of US Airways. That was their original intention and Atlanta is backing them 100% percent. It doesn't make any sense for US Airways to take Delta in the first place considering both airlines seem to reach the same areas.

It really has nothing to with HQ's and ego, but more with how the City of Atlanta and it's evolution. Delta was a BIG proponent in making Atlanta a major city and has been influential towards its image, considering how many connections are made at Atlanta's airport.

I'm sure some people weren't pleased with America West adopting the US Airways name after it merged, the same would be for Delta even if we kept our name. Delta would lose its identity outside of Atlanta.

[colin]

I agree, US Air/AWA:Phoenix <> Delta:Atlanta

Not even close. Per servicing the same areas though, that's sort of true except that their hubs are always off by a few hundred miles which still keeps them separate. For instance, here in Tucson, the only way to get to Atlanta or SLC directly is Delta. Tucson's not a big market, but it's indicative of other, less competitive cities. And I've always understood that the airlines don't make the majority of their money on the more competitive airports like Phoenix or Las Vegas.

[MJLO]

The major hubs are to competitive, the populations are big enough where they all have to compete. Whereas satelite cities like Tucson or Fresno have much fewer options, and are more expensive while cheaper to operate in. It's the market at it's finest.

[markusparkus]

I agree, US Air/AWA:Phoenix <> Delta:Atlanta

Not even close. Per servicing the same areas though, that's sort of true except that their hubs are always off by a few hundred miles which still keeps them separate. For instance, here in Tucson, the only way to get to Atlanta or SLC directly is Delta. Tucson's not a big market, but it's indicative of other, less competitive cities. And I've always understood that the airlines don't make the majority of their money on the more competitive airports like Phoenix or Las Vegas.

[colin]

US Airways increases offer for Delta to $10.2 billion

Nail biting time?

[MJLO]

They are going after this hardcore. I don't think that they will be denied by the government. I read a commentary in the Tribune a couple weeks ago about this and I have to agree. Instead of trying to offer a better product in the airline industry, USAirways is simply a merger and aquisitions company. They didn't even give it a go. I am annoyed. I am almost certain, just from the logisitics standpoint that if the merger takes place, they will consolidate in Atlanta, and leave the valley. Delta will fight it bitterly until the end, i've even heard the rumor that they are in talks with a long time ally, NWA for a merger.

It is a certainty that having the worlds largest airline in Phoenix, would give us a little more notariety, as more than just an economy of tourism and construction. The only place I'd rather see them other than here is in Grand Rapids Michigan, but that's just home town boisterism talking.

[tombarnes]

"USAirways is simply a merger and aquisitions company."

That's it. In a nutshell, that's all this has ever been about. USAirways has never been especially interested in its customers- only in financial strategy. While there have been a few improvements since the takeover, I doubt that this would serve the flying public in any way. Whay are you so certain that this will receive regulatory approval? This flies in the face of everything thtat the existing laws try to prevent. If USAirways is successful with this attempt, it will not bode well for the flying public.

[MJLO]

It may or may not.

If they continue to suck as a company, customers may scatter. Big doesn't always make them better. They'd be going into this with alot of overhead so they couldn't perhaps be the "Walmart" of Airlines. If the fares aren't rock bottom, and the service is still sub-standard. The flying public could would do just as well on a different flight with another company.

[tombarnes]

The main problem I see for the public is that this move may eliminate competition in many markets. It will certainly reduce the available choices for many consumers. Airlines like Southwest and JetBlue will come into a few markets and take up the slack, but this won't happen everywhere. I see this as an "airgrab" by USAirways and nothing more. Their fares surely aren't going down any time soon.

[colin]

Senators skeptical of US Airways-Delta merger

I'm not going to say "I told you so" quite yet, but I knew that this whole merger BS would get a lot of looks from the feds.

[monsoon]

Senators skeptical of US Airways-Delta merger

I'm not going to say "I told you so" quite yet, but I knew that this whole merger BS would get a lot of looks from the feds.

[Inkdaub]

What's up with USAirways anyway? A few years ago they were courting bankruptcy...before 911 happened. Then I look up and see they bought America West and now they are after Delta? The fortunes of these airlines are on the razors edge.

[tombarnes]

America West actually took over USAirways and kept the name. The current airline is really America West with the old name.