Merger do-si-do: Continental spurns United, but other partners are ready to dance
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Continental doesn’t like United anymore, but is sorta into the oneWorld alliance headed by American Airlines and British Airways. American Airlines is interested in that, too, but simultaneously also has its eyes on US Airways. United, having just been dumped by Continental, is looking to rekindle an old affair it had with US Airways, too, but now has to worry about American Airlines, which is sidling up. All the while, Delta and Northwest are not a done deal, and with unions getting crankier about the merger, who knows what will happen. And those two, already allies of Continental in SkyTeam, are feeling slighted that their longtime partner is considering joining another clique.
This is all so freaking high school.
I’m not a fan of these mergers, but I realize that this isn’t about consumers, and the fact that none of this will improve prices or service. It’s about companies with unsustainable business models trying to eke out enough corporate life to survive until the CEO retires with huge pay package.
Just get it over with.
Related:
- Mergers: Are your miles safe?
- Reader mail: What will airline mergers mean to consumers?
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April 28th, 2008 at 2:40 pm |
To me it is mostly about the players having enough muscle to wrestle some capacity out of the marketplace. That will allow them to get the rate increases needed to cope with jet fuel prices.
I’ve also written twice on the subject over the weekend.
Aloha,
Jeff
http://beatofhawaii.com
April 28th, 2008 at 6:38 pm |
It isn’t just US-based airlines that are busily talking up mergers. Alitalia has been on the market for years and the Air France /KLM deal to take over appears to be over. Bmi is in play this year with 2 options between majority owner and Lufthansa while SAS is also wanting to sell it’s stake. Iberia has also been in and out of merger talks for some time. Lufthansa with their strong balance sheet and past history is never far away from rumours on other European airlines.
Meanwhile, the funniest bit is a report from Qantas that it too is willing to consider mergers.
April 30th, 2008 at 6:26 am |
Yeah…but there will always be up-starts like - thankfully - JetBlue.
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http://meadonmanhattan.wordpress.com/