It reads on both forums as cage match for survival. Is there not a possibility of a merger?

 

UA is looking to drive down costs, a merger would not really do that. Every decision a mainline carrier makes over the next 3 or so years is going to be about one thing and one thing only, the bottom line.

 

Or UA wants to get the concessions out of XJT before they merge the two carriers.

 

Correct. C5 and EV are flight crew / mechanic leasing companies. This situation is no different than when the ground handling contract switches between two companies. The previous company lays everyone off and the new one hires most of them (get rid of troublemakers) back at first year wages and accruals. 5 years later they do it again.

Mergers are conducted to combine productive assets and revenue streams, reduce competition and redundancies, and create dominance in a market.

The only productive assets in this case are human resources. They can be even more 'productive' on first year pay. At least in the economist use of the word.

A merger would benefit senior pilots who might have the courage to resist being abused. Killing a carrier on the other hand scares everyone back into line.

 

Let’s say xjet decides to beat c5’s costs by 1% (taking dramatic cuts)

does c5 just fold? No, they cut their costs 5%. Xjet sells a kidney and goes c5 minus 10%. C5 goes to minus 20, xjet dies, united happy

 

UA should want both to survive. If it kills one then the remainder has a monopoly in the market. This is all just a game to drive down prices 'oh you bettee be cheaper than c5.' (Vice versa)......

Suppose either goes down....then two.months later there is no competition; this allows the surviving organisation to drive the contract back up. It just doesn't make sence.

 

There will be no merger. They just drove TSA out of business a few months ago essentially. They will do the same again. Reset the longevity with fresh blood.

 

Speculation:

United doesn’t care about a monopoly 145 operator because the airframe is going away. They’ll use it as a cheap stopgap for a year or two until demand comes back and they have time to figure out the rest of the fleet plan. Whoever ‘wins’ this ludicrous cage match is only delaying the inevitable for a few years before they too get the TSA treatment.

The work groups will have no leverage to negotiate pay increases while the company is getting 500 resumes per hour and filling new hire classes with as many bodies as they wish. The current CPAs are interim month to month extensions. The ‘permanent’ one will have a 2-3 year duration at barely break even reimbursement rates.

Further speculation:

Jeff Bezos is watching this and learning. These same delightful tactics will be coming to the ACMI world sooner or later. The groundwork is already being laid.

 

TSA drove itself out of business. HK is an asshat.

 

how do you put a hat on an ass?? 😂😂😂