Originally Posted by
freightguy
I wonder how a CAL-UAL merger could affect Delta. I would assume it is good news as some capacity is bound to reduce as is the case in any merger. Hopefully they will axe regionals just like we did. However, the alliance (UAL+CAL) will have a strong hold on the NE coast with IAD and EWR. On the other hand, are they not a little too close...EWR and IAD?
Also, UAL (with CAL) might catch substantial market share in Tokyo with JAL pulling out of many long-haul markets. It looks like UAL/CAL is at the right place at the right time with their alliance with ANA. JAL just announced pullback from several US routes including our KIX-HNL route....which could help us out as we operate that sector already.
Anyone care to speculate?
Actually, if you read the remarks about JAL from their CEO, he is refusing to pull down more market share. He has stated that the government needs to get out of trying to run JAL. Not so good for DAL, but good for JAL.
With the tie up, you can see that their stocks are jumping and will try to level out once the stock swap ratio is determined. Ours is flat. I suspect that CLE is gone, there is a lot over North Atlantic Overlap out of NYC and IAD. Most of it will stay but some will not. It will not be a no job loss merger on the front end like ours was. That is fo so.
In the short term it will be good for DAL. They get to deal with all of the curd our leaders (both DALPA and the Company) effectively cut off at the knees and made this merger work. They are making money. CAL is in section six. They are going to want a lot more than pragmatic gains, all groups not just the pilots. That will either take a nice pocket book for the sake of expediency, or it will get drawn out. In that time, we have a chance to gain market share as we are streamlined.
Once they get all of that figured out they and rationalize their route structure they will be a fierce competitor. (Side note, it will force AMR to find a bride) All of this will make four really strong competitors in the US market(LUV who will merge with AAI and AS) The capacity will get compacted as demand grows and the margins will increase.
Of course this will be all for nothing if they allow low cost entrants back in to start the cycle over yet again.
Just a little snap shot of what I see going forward.