The US DOJ, various state attorneys general and the District of Columbia have filed challenging the American Airlines (AA)–US Airways (US) merger. This news was not what was expected by industry followers. The previous merger between Delta and Northwest went through without a hitch, followed by United and Continental and then Southwest and AirTran, all of which were approved. How is this merger any different?
It can’t be competing routes. Delta and Northwest had 12 overlapping non-stop routes, United-Continental 11, and Southwest-AirTran 18 routes. USAirways and American overlap on 12 – so that certainly can’t be the reason. It appears that the DOJ has decided, after three mega-mergers, that a fourth will be anti-competitive and change the nature of the industry.
Up to now the US has been leading the airline industry in turning around its profitability. This has been enabled by two key… Continue reading
Embraer’s E-Jets are coming to United Express, after the airline ordered 30 plus 40 options. Deliveries are slated to arrive in the second quarter of 2014. The E-175 aircraft will be fitted to seat 76 passengers, the current limited under the scope clause in the pilots union contract.
The enhanced E-175 will provide significant improvements over the current E-175. Embraer speaks of the airplane’s new wingtips, systems optimization and aerodynamic refinements that will lower fuel burn by as much as 5%. United Airlines expects their new E-175s to achieve fuel savings of 10 percent in comparison to the 50-seater regional jets they will replace. The United order follows an order from American for 47 of the E-Jets.
Consolidation among the US airlines is making the competition fierce on competitive routes, but oligopolistic on non-stops. OEMs and labor are not the only ones facing fewer options. Passengers… Continue reading
With a precautionary landing by a United 787 and the issuance of an Airworthiness Directive over the last two days, the mainstream media are suggesting more potential problems for Boeing with the 787 program. That simply isn’t the case. Continue reading
Yesterday, United Airlines took delivery of the first of 50 Boeing 787s it has on order, and the first of five expected to be delivered in 2012. United is the first US airline to operate the Boeing Dreamliner, and takes its first delivery nearly a year after the first 787 was delivered to Japan’s All Nippon Airlines.
The 787 aircraft to be delivered in 2012 will be initially based in Houston for training purposes and will be first deployed domestically on services between the airline hubs at Chicago O’Hare, Houston, San Francisco Newark, Cleveland, Denver and Washington Dulles. It is expected that after the introductory period, the aircraft will be re-deployed on international routes. 787 routes are already listed on United’s reservation system, with flights from Houston to Chicago beginning in November.
United will configure its 787s with 36 First -Business class seats, 72 Premium Economy, and 111 Economy… Continue reading
Probably no single new technology is capturing more attention among airline pilots than the Electronic Flight Bag (EFB). And recently the EFB market has become captivated by Apple’s iPad®. These facts were manifestly underscored at the recent EFB workshop in Dallas, Texas.
Operational pressures on airlines are at the most intense levels ever. Airlines are desperate to save money and are leaving no stone unturned in attempts to cut costs. Airlines have leaped into leveraging technology in order to save costs. Tablet computers have attracted airline staff attention. The 2011 airline survey by AvIntel, an industry consultancy, showed that half of the respondents mentioned the iPad as one of the primary options for their EFB projects.
There are many ways to look at the potential (and quite likely) merger of American Airlines and US Airways. There are the obvious issues everyone is talking about, but take a listen to the less obvious issues. The impact on start up airlines, the alliance impact, the impact on US airlines like Alaska and jetBlue and quite importantly, the impact on the GDS systems. The disruption of such a merger will be not be ripples in a pond. The most clear impact will be on airfares – they will rise even higher. This improved financial situation might be good for airlines as their improved financials might even make them investment options again. But the impact will also have to run through political approval – which is not obvious.
Discussing the situation for nearly 30 minutes we have airline and travel industry analyst Henry Harteveldt from… Continue reading