Retired American Airlines CEO Bob Crandall has a video message to American pilots on a potential merger with US Airways.
He says he favors the concept of a merger which makes American the largest carrier in the world again.
But I read him as arguing against a merger, or giving pilots a reason to change their minds about the desirability of a merger.
He says a merger is great only if there’s a pilot seniority integration agreement in place first and that it needs to include all the pilot work groups of US Airways West (former America West pilots), US Airways East (US Airways legacy pilots), and American pilots.
The warning here is that the merger will mean closing pilot bases, opening other ones. Pilots will have to move, some pilots will wind up flying smaller aircraft.
Whereas if American didn’t merge, current American pilots get to fly all the cool new planes that American has on order.
Anyone disagree with my read, that Crandall’s pitch for a merger is a pitch against the merger?
(HT: Airline Biz Blog)
Love him or hate him, Crandall has a wealth of wisdom in airline ops. The message is clear – if AA pilots sign off on this merger be prepared for a lot of unsettling changes. The prospects for seniority integration are slim, as he reminds us that US Airways still hasn’t overcome this hurdle. Personally, I hope AA emerges as a stand alone airline.
He says he favors the merger “if” but it seems like a backhanded way to say he’s against it. It’s like saying “oh yes it’s a good idea if you want to move, fly crappy planes and routes as well as change all the IT systems you use, yes I’m for it”
Crandall’s right that the union chapters need to have all their ducks in a row before any merger should be approved. DL-NW was incredibly smooth largely because the pilots signed off on everything before it was even greenlit. The US-Air West merger hasn’t been half as smooth, and I can’t imagine US-AA could possibly be any better than that if they don’t approach it in a radically different way.
I have to believe that Crandall wouldn’t speak unless he had a motive/preference/recommendation in mind.
But I think he is speaking the truth–a merger makes sense from a corporate perspective, but pilots must look at it from a reasonable and realistic perception as opposed to this rosy view they’ve had because they hate Horton and Co.
The success of a merger hinges on Pilots, and all groups, working together as one to improve. Without that, there is no point in a merger.
Why not bring Crandall back as interim CEO? Grinstein at Delta was equally wise (ie, old) and well-liked, and he successfully navigated DL out of bankruptcy.
I think your analysis is spot on, Gary.
I’ve been telling myself for months that if US and AA merge with Dougie (or his cronies) in charge, I’ll never fly either airline again. Unfortunately, living in the Washington, DC area I don’t know if I’ll be able to stick to that. US dominates at DCA, and I’m very reluctant to fly UA out of the C/D concourses at IAD unless I have no other choice. Won’t have to fly them all that often, but I don’t think I’ll be able to avoid them completely. 🙁
Gary,
Maybe this is an obvious question, but are you against the airlines potential merger from a consumer’s perspective? I assume so, but I was not entirely clear if you came out and said so in an earlier post on the topic.
I have not been around the block as long as some, but have these mergers ever been “good” for travelers?
@AJTrenkle – I think that the merger will be good in some ways, bad in others, but overall (1) the general flying public won’t really be affected, except for short-term integration pains, (2) American’s top tier elites will generally become worse off, (3) I will be better off as an American Executive Platinum flying out of an airport dominated by US Airways 🙂
Crandall is right on considering the structure of the network as to why he’s not so much in favor of the merger, unlike United-Continental, and Delta-NWA. American-US Airways is really not a great merger when it comes to the network and “bases” (i.e.: hubs) between the two carriers.
US Airways merged with America West already on top of this. I believe that American and Alaska should do a merger first before going with US Airways at all. In fact, all American needs with US Airways is just the BOS-JFK-DCA shuttle. The rest can go to Jet Blue.
Bring Bob back !!! when he was in charge all the other airlines would wonder what is Bob going to do next.?? I enjoyed working under his passion and love for American . He cared about his employees and customers which is totally lacking currently. If you want a strong airline you need a stronger CEO.. Crandall is the guy!!!