Any opinions about a possible AA & BA merger?

[Joshua949]

I have been reading a few news stories on this & British Airways said if the Air France/KLM merger continues then BA said they will start talking about a possible American Airlines & British Aiways merging together. I think that would be cool thing to see as long as neither one of them go under.

 

[H46Bubba]

Won't happen. The powers that be, will not approve of such a merger.

 

[I_Money]

They have been trying to do this for a while and have been refused permission - latest news is that BA and Iberia might match up. I think in the future it will be a few airlines who serve the world - which will be great for air miles.

 

[chunk75]

That would come dangerously close to cabotage, don't you think?

 

[I_Money]

How would that be cabotage? It would probably the most complex merger on earth - but at the end of the day the ownership would be so diverse it would be something else.

 

[tonyw]

Not going to happen.

The US government does not allow foreign ownership of an US based carrier. For a perfect example of this, check out the DHL vs. UPS and FedEx flap.

 

[ready2fly]

Mmmm - cabbage.

 

[I_Money]

What am I missing - foreign ownership?? This is a merger not an acquisition.

 

[av8rmsu]

[ QUOTE ]
What am I missing - foreign ownership?? This is a merger not an acquisition.

[/ QUOTE ]

Merger- the combination of two (or more) firms into a single firm.

Straight out of my economics book from college ( I know I received a degree in business for something

)

A merger is where assets are joined. A partnership is a whole different thing. Northwest and KLM have had a partnership for years. They share interests but not assets. I don't think it would be in either of the airlines interests to merge with each other. AA can't handle any more debt and why would BA want to join the fun and festivities of the airline debauchles on this side of the Atlantic.

A partnership may not be that bad of an idea. Try to share some of the Atlantic routes.

 

[Joshua949]

Actually, if they were to merge it wouldnt be a full merger..i remember when they tried to do this but it failed..if they were it would only be a merger on transatlantic routes & i have also heard the possibility of BA & Iberia merging too.

 

[I_Money]

The point I am making without knowledge of equity splits (THE MAJOR FACTOR) you can not determine the make up of the ownership of the airline.

 

[shooter13]

How long do you think cabotage won't be allowed? This is a concept that really scares me for career implications.

 

[stultus]

[ QUOTE ]
Try to share some of the Atlantic routes.

[/ QUOTE ]

They've been trying but the US gov't won't even let AA/BA do that, even though they are both in Oneworld. That's why I had to get HP miles on my BA LAX-LHR trip this year.

I doubt a merger would actually happen, but who knows. Like everthing else in this industry, I'll beleive it when I see it.

 

[Phoenix_Son]

I've never heard of cabotage, so I'm posting a definition for those of us who don't speak fluent Airplane yet. This is from http://www.dot.gov/ost/ogc/subject/faqs/international/airlineCabotage.html
"Airline cabotage is the carriage of air traffic that originates and terminates within the boundaries of a given country by an air carrier of another country. Rights to such traffic are usually entirely denied or severely restricted."