Delta, United discuss combining operationsAssociated Press
ATLANTA - UAL Corp.'s United Airlines and Delta Air Lines Inc. have been discussing a combination between the nation's second- and third-largest carriers that would keep the United name and the corporate headquarters in Chicago, The Associated Press has learned.
Two hundred aircraft orders here, 82 here, 188 there and plenty of others elsewhere. However, a merger between United and Delta could be the trump card of the week. There was not a single order by a North American commercial operator (correct me if I'm wrong) at the Dubai Air Show - this would be a massive shift in the US market.
I'm going to take a little time to digest the news because I spent the day traveling and I am still trying to convince my body to be asleep when it's supposed to be and awake when it's supposed to be. However, there are a few big questions that immediately come to mind about any merger.
What would the resulting fleets look like?
Overlap:
777-200 (different engines)
767-200/300ER (different engines)
757 (Same engines - PW)
CRJ200
CRJ700
United
747-400
B737-300/500
A319
A320
Delta
767–400ER
737–700 (on order)
737–800
MD–88
MD–90
777–200LR (on order)
What would codeshare/FF alliances look like? Would Delta leave Skyteam for Star Alliance? Would they join forces?
Delta - Skyteam - Partnering with AeroMexico, Aeroflot, Air France, KLM, Continental, Alitalia, CSA, Northwest, Korean, Air Europa, Copa, Kenya Airways
United - Star Alliance - Air Canada, Air New Zealand, ANA, Asiana, Austrian, BMI, LOT, Lufthansa, SAS, Singapore, South African, Spanair, Swiss, TAP, Thai and US Airways.
Is this any good for travelers?
Yes - Expanded routes mean more accessible networks and schedules.
No - Less competition means higher fares - especially in regional markets.
What happens to regional carriers?
What questions come to your mind?
on November 14, 2007 11:02 PM | Reply
UA and DL deny the story but here's a podcast on the subject anyway:
http://iagblog.podOmatic.com/entry/2007-11-14T14_24_20-08_00
on November 15, 2007 12:01 AM | Reply
Well for the regional network on the Crj's i wonder how that would play out because most of United's regional routes in the Crj are operated by skywest or mesaba (i think that is how you spell it) That could be interesting. Also the Alliances would be weird too i wonder how that would work out. Also how about the paint schemes would the all Eventually change to United or Delta?
on November 15, 2007 1:03 AM | Reply
Well considering the anti-trust issues the last time UA tried to merge with another US major (US) the lawyers at DL and UA better sharpen their pencils to get over DoJ and European antitrust concerns.
Secondly, given how the US-America West and the AC-Canadian mergers went with regards to the pilots and their unions, management had better think of a way to harmonize staff as well as routes and alliances.
Thirdly, they would have to give up some route authority and I wonder if this puts DLs China outes at risk or even routes to LHR?
Fleet is also going to be a big question mark and from the reports it seems that UA will be in charge. What does that do with the 737 fleet and the 777 fleets? Given that UA has no orders left to be delivered but DL does, does the newly merged company take them? I guess it also depends on the routes that might be given up and if it is the China routs then the 77E might be cancelled.
Just speculation on my part.
on November 15, 2007 4:47 AM | Reply
GOOD for company officers, investment banks, brokerages. BAD for everyone else: employees, customers (AKA: PAX,) localities, ancillary businesses and small wallpaperholders.
And fares ... well, so long as we continue to insist on fares which are affordable for guys in tank tops to be flown around by quarter-million a year pilots on quarter-billion dollar planes, no, fares won't go up. Our carriers will just consume one another until the last one is eventually devoured .. by Emirates.
on November 15, 2007 1:17 PM | Reply
Somewhere I read that UAL still has the highest operating costs in the business, I think on a per passenger basis. Why would any airline want take those on, particularly Delta which seems actually to be doing well after its trip to bankruptcy-leaner particularly. One answer to how a merger would work is to copy the AF/KLM model under which the two airlines were initally just run completely seperately as if no merger had occurred and changes were made as they made sense as the businesses was operated day to day.
on November 15, 2007 9:19 PM | Reply
hey jon i think there is something wrong i posted the first comment but it says Scott and the second comment was probably posted by Scott but it says me can you fix that?
on November 16, 2007 11:08 PM | Reply
Like it is said in the pod cast they will talk about merger but it will never happen because the old guys will be fighting about sernority.