Dream of American-US Airways Merger A Reality
About two years ago, I had somewhat prophetic dream, which seems to be a recurring theme in my life. Perhaps I should play power ball…
Anyway, my dream featured a swank airline, with lavish red decor, plush seats, and tons of legroom. The name of the airline coincidentally, happened to be American Airways. I then remember regaling my adventures on said airline to a colleague of mine, who remarked how fortunate I was to fly such a fine airline. Then I woke up.
Having been drawn into the world of travel hacker already, my immediate thought was “There is no such airline!” Or so I thought.
THE RUMOR MILL
Then late 2011, amid restructuring following their bankruptcy, rumors began to circulate about a potential merger. While a number of bloggers rambled on about what this may mean for all parties, things eventually seemed to be dying off, or so we though. Which is why I didn’t pay it any attention or think about mentioning here on my blog.
Nevertheless, this deal apparently will be coming to fruition next week, according to USA Today.
A DAY DREAM OR A NIGHTMARE?
I am certainly no economist, but I have to wonder what value this will serve, post-bankruptcy. Perhaps in dealing with their creditors and breaking in a little more revenue, but American may be spreading itself a little too thin. I mean does an airline that has hubs in Dallas, Miami, Chicago, Los Angeles and New York really need hubs in Charlotte and Philadelphia? And a larger operation does not always equate to a better operation.
An additional concern with this merger would be whether or not award redemptions would become devalued. As with the Continental/United merger, these deals seem to combine policies of both airlines. Take for example one of the sweet spots of US Airways awards-being able to book a First Class ticket to Asia, with a stopover in Europe for 120,000 miles roundtrip. I don’t think there is any guarantee this would continue post-merger.
Or from the American side of the house, their customer service has gained their agents the title of “AAngles.” Who knows how this will work when integrating a disgruntled US Airways work force.
Additionally, what I find most intriguing is who will run the new American. While AMR (American’s parent company) CEO Tom Horton will still be on staff, it seems American is looking to inject new blood into the company by putting current US Airways CEO Doug Parker in charge. Oversimplified? Quite possibly, but as par for the course when the business side of frequent flier programs comes up, Gary of View from the Wing is quite adept at explaining the concepts, and this case is no exception.
Finally, on a personal I invested in US Airways miles a few years back for a future redemption, and think now would be a swell time to use those miles.