AA VS UAL Approach
06-14-2020, 05:28 PM
#61
Gets Weekends Off
Joined APC: Apr 2009
Position: CA
Posts: 186
Originally Posted by Skylarking
Thanks for posting the article. One thing I'm curious about wrt United is how much the reduced international flying is impacting the domestic flying. Does anyone know about what percentage of mainline narrowbody pax are connecting to an international flight? Also curious to know the percentage for AA and DA if anyone has that data.
- U.S. airlines are taking different approaches to managing through Covid-19. AAL is adding back capacity far faster than UAL and DAL, gearing towards a revenue-based recovery. This June AAL is flying 158% more domestic seats than UAL and 49% more than DAL. And LUV will fly 270% more than UAL and 114% more than DAL. That is astonishing, and we don’t know how long it can last. LUV can withstand pretty much anything but AAL is tying its fate to an unknown demand recovery as they add back cuts and pull ~200 planes out of storage in June/July, including at least 18 widebodies. We do not expect UAL and DAL to stand around and watch.
- AAL’s June 2020 domestic capacity is 158% more than UAL’s capacity, on a seat basis. Assuming AAL continues to cancel minimum flights each day (from what we can tell, they are canceling ~80 flights/day so far this month, for perspective), AAL will fly 6.5M domestic seats in June compared to UAL’s 2.5M and DAL’s 4.4M. The 4M seat count difference between AAL and UAL’s seat capacity in June equates to the total combined domestic seat output of ALK, JBLU, HA, SAVE, and Sun Country. LUV and AAL combined account for 53% of domestic seat supply in June.
- It’s too early to rely on July schedules but we expect this gap will still be significant between AAL and DAL/UAL after June, though we expect it will converge in August. AAL is adding this capacity back via utilization and airplanes that were previously stored, pulling 64 planes out of temporary storage in June and another 141 in July, including 10 B777s and eight B787s. We believe ~eight of these will be used for cargo operations, though we aren’t sure which eight.
- No one knows how demand will spool up over the summer and beyond. AAL and LUV are each betting on a recovery. Both are obviously seeing booking strength – they aren’t flying incrementally emptier planes – but LUV can more easily afford it and can more easily reverse it, if they are wrong, in our opinion. AAL is taking a different approach to this crisis. Since Covid-19 AAL has raised only $1B of incremental cash from the capital markets (excluding the $2.7B draw on its revolvers) while UAL has raised or attempted to raise $6.1B and DAL $12.9B. AAL has obviously signaled its intention to take the UST loan while DAL and UAL may try to avoid it, but clearly there are diverging strategies in more ways than one here.
06-14-2020, 10:57 PM
#62
Gets Weekends Off Rarely
Joined APC: Feb 2019
Posts: 185
Originally Posted by lavMan
Here’s an article that addresses some of it. Wolfe Research airline analyst Hunter Keay provided investors his take on the differing strategies of airlines during the recent uptick in demand. Here are a few excerpts:
- U.S. airlines are taking different approaches to managing through Covid-19. AAL is adding back capacity far faster than UAL and DAL, gearing towards a revenue-based recovery. This June AAL is flying 158% more domestic seats than UAL and 49% more than DAL. And LUV will fly 270% more than UAL and 114% more than DAL. That is astonishing, and we don’t know how long it can last. LUV can withstand pretty much anything but AAL is tying its fate to an unknown demand recovery as they add back cuts and pull ~200 planes out of storage in June/July, including at least 18 widebodies. We do not expect UAL and DAL to stand around and watch.
- AAL’s June 2020 domestic capacity is 158% more than UAL’s capacity, on a seat basis. Assuming AAL continues to cancel minimum flights each day (from what we can tell, they are canceling ~80 flights/day so far this month, for perspective), AAL will fly 6.5M domestic seats in June compared to UAL’s 2.5M and DAL’s 4.4M. The 4M seat count difference between AAL and UAL’s seat capacity in June equates to the total combined domestic seat output of ALK, JBLU, HA, SAVE, and Sun Country. LUV and AAL combined account for 53% of domestic seat supply in June.
- It’s too early to rely on July schedules but we expect this gap will still be significant between AAL and DAL/UAL after June, though we expect it will converge in August. AAL is adding this capacity back via utilization and airplanes that were previously stored, pulling 64 planes out of temporary storage in June and another 141 in July, including 10 B777s and eight B787s. We believe ~eight of these will be used for cargo operations, though we aren’t sure which eight.
- No one knows how demand will spool up over the summer and beyond. AAL and LUV are each betting on a recovery. Both are obviously seeing booking strength – they aren’t flying incrementally emptier planes – but LUV can more easily afford it and can more easily reverse it, if they are wrong, in our opinion. AAL is taking a different approach to this crisis. Since Covid-19 AAL has raised only $1B of incremental cash from the capital markets (excluding the $2.7B draw on its revolvers) while UAL has raised or attempted to raise $6.1B and DAL $12.9B. AAL has obviously signaled its intention to take the UST loan while DAL and UAL may try to avoid it, but clearly there are diverging strategies in more ways than one here.
06-16-2020, 11:27 AM
#63
Line Holder
Joined APC: Apr 2012
Posts: 46
Sounds like things over at AA are not too bad at all. Just had their “displacement” and didn’t really materialize to much. Most people kept their seat and base as opposed to our bloodbath. See what happens
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06-16-2020, 12:45 PM
#64
Gets Weekends Off
Joined APC: Feb 2020
Posts: 142
Originally Posted by AirMicronesia
..It wasn’t until years after Continental bought United that the “Screw Continental” pin was removed from a display case at the United training facility.
It is truly disgusting and I apologize for the rest of the United employees. Just as UALALPA considered themselves “brain surgeons” and the Frontier pilots “”general practitioners” and their *cough* ALPA brothers *cough* at Air Wisconsin not even worthy of a preferential interview after United bought Air Wisconsin and dismantled it, the brain surgeons will cheer if American liquidates.
06-16-2020, 04:42 PM
#65
Banned
Joined APC: Apr 2020
Posts: 55
Originally Posted by Bat Guano
You're FOS and have no idea what you're talking about, particularly WRT to what I underscored. But, hey puff up your chest and keep it up. What tripe.
On March 31, 2013, United merged with and into Continental, with Continental continuing as the surviving corporation of the Merger and as a wholly-owned subsidiary of UAL.
Any questions or does that clarify things for you? That’s from the SEC filing.
Are you alleging that the United MEC did not state during the attempted merger with frontier that a United pilots were akin to brain surgeons and the Frontier were lowly general practitioners? I’m confused as to what I wrote that you believe to be incorrect. I already clarified your misconception regarding the the merger I hope.
06-16-2020, 04:46 PM
#67
Gets Weekends Off
Joined APC: Oct 2010
Posts: 2,639
Originally Posted by AirMicronesia
On March 31, 2013, United merged with and into Continental, with Continental continuing as the surviving corporation of the Merger and as a wholly-owned subsidiary of UAL.
Any questions or does that clarify things for you? That’s from the SEC filing.
Any questions or does that clarify things for you? That’s from the SEC filing.
Who is this UAL that bought a subsidiary named Continental?
Which stockholders were paid for their stock in the deal?
Once you figure out who got paid you can usually figure out the buyer and seller in a transaction, no?
As bad as it is that you are rehashing a deal that happened 10 years ago, you are even getting it wrong.
06-16-2020, 05:09 PM
#68
Gets Weekends Off
Joined APC: Feb 2012
Position: 787
Posts: 3,138
Originally Posted by AirMicronesia
On March 31, 2013, United merged with and into Continental, with Continental continuing as the surviving corporation of the Merger and as a wholly-owned subsidiary of UAL.
06-16-2020, 05:18 PM
#69
Gets Weekends Off
Joined APC: Apr 2015
Posts: 491
Originally Posted by AirMicronesia
On March 31, 2013, United merged with and into Continental, with Continental continuing as the surviving corporation of the Merger and as a wholly-owned subsidiary of UAL.
Any questions or does that clarify things for you? That’s from the SEC filing.
Any questions or does that clarify things for you? That’s from the SEC filing.
From the NYT article. “United is buying Continental, and the combined company will keep the United name and be based in Chicago. The UAL Corporation, United's parent company, would issue 1.05 shares for each Continental share, valuing the acquisition at $3.17 billion, based on Friday's closing price.”
https://www.nytimes.com/2010/05/03/b.../03merger.html
06-16-2020, 06:47 PM
#70
Gets Weekends Off
Joined APC: Apr 2010
Posts: 694
please stop
the merger is so done and dusted that it’s legit ancient history and there are new things to be unified about and concerned with like you know flying 25% of our regular schedule in July
the merger is so done and dusted that it’s legit ancient history and there are new things to be unified about and concerned with like you know flying 25% of our regular schedule in July
Originally Posted by O2pilot
Continental became a wholly-owned subsidiary of UAL. You posted it yourself. Having a hard time with reading comprehension? Guess you never looked at that United ID badge you got after the merger, or the United name on the side of the plane, or your paychecks, or all the old Continental HQ and Training Center closing.
From the NYT article. “United is buying Continental, and the combined company will keep the United name and be based in Chicago. The UAL Corporation, United's parent company, would issue 1.05 shares for each Continental share, valuing the acquisition at $3.17 billion, based on Friday's closing price.”
https://www.nytimes.com/2010/05/03/b.../03merger.html
From the NYT article. “United is buying Continental, and the combined company will keep the United name and be based in Chicago. The UAL Corporation, United's parent company, would issue 1.05 shares for each Continental share, valuing the acquisition at $3.17 billion, based on Friday's closing price.”
https://www.nytimes.com/2010/05/03/b.../03merger.html
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