US Airways CEO Doug Parker has taken to the road to convince members of the media and the public that a merger of his carrier and American Airlines is the best option for both companies as American works its way through bankruptcy court.
Parker, along with US Airways president Scott Kirby, visited USA Todays editorial board Wednesday to make the case for a merger. Hes scheduled to speak at the National Press Club in Washington and the Observer next week.
Combined with Parkers earlier public courting of Americans major unions, the road show makes for an unusually public attempt at a merger, said Henry Harteveldt, aviation analyst and co-founder of Atmosphere Research Group.
It certainly is very, very aggressive, he said. When Delta and Northwest coupled up, you didnt see Delta doing anything close to what US Airways is doing.
The publicity tour comes on the heels of American parent company AMR Corp.s decision this week to consider potential merger bids. AMR chief executive Tom Horton, who worked with Parker at American in the 1980s, said the carrier is ready to consider alternatives to exiting bankruptcy as a standalone company.
But media reports suggest US Airways isnt the only potential merger partner in the mix, as American is said to be considering regional carriers such as JetBlue and Alaska Airlines as well.
US Airways is also doing this to forestall any attempts by anyone else, said Harteveldt. (Parker)s marking his turf.
Even if another airline or investor doesnt make an outright bid for American, Harteveldt said American could still sell part of its assets, routes or hubs to other airlines potentially thwarting Parker. Moreover, American still has the exclusive right to present its own reorganization plan and is seeking to extend that through December.
Tempe, Ariz.-based US Airways operates its busiest hub at Charlotte Douglas International Airport, with about 7,000 employees and more than 600 daily flights based out of the airport.
The merger would create the nations largest airline by combining American, the No. 3 carrier, with US Airways, which ranks No. 5. The merged airline would be bigger than its three chief rivals: United Continental, Delta Air Lines, and Southwest.
On Wednesday, Parker told USA Today that he hasnt yet heard from Horton about the possible merger.
I think you can color us skeptical right now about their true intention, Parker said. Everything theyve said and done up to this point seems to indicate that they want to emerge standalone. And, if they dont want to emerge standalone, they want to go find some way to emerge where theyre in control.
US Airways has been pursuing a merger with American since the Fort Worth, Tex.-based company entered bankruptcy protection late last year. Speculation about a possible US Airways merger began immediately. Parker has been a longtime advocate of industry consolidation and had tried four previous mergers with other carriers one successful, three unsuccessful in the past decade.
Since rumors and unconfirmed reports of the merger push began to surface early this year, US Airways plans have become more and more public. Parker first confirmed that US Airways was pursuing American, then announced that US Airways had already reached accords with Americans three largest unions of pilots, flight attendants and ground workers.
Harteveldt thinks Parker has the burden of showing a combination is a good idea. Thats because US Airways has still not fully integrated its workforce from its 2005 America West merger, fueling skepticism among some employees and investors. The traveling public has already seen fares and fees increase, and a merger could push them still higher, by reducing competition.
Parker also has to allay another concern, Harteveldt said: That his team might not be prepared to run the nations largest airline if a merger goes through.
US Airways is a much smaller airline than American, he said. That means US Airways has to work harder to make the case it is capable of running the business.