US Airways CEO, Doug Parker stated plans to merge with another carrier may be blocked by a provision in its pilots contract (TheStreet, 05-Apr-2010). At a meeting held on 17-Mar-2010, Parker reflected on a contract provision requiring that if the airline has a change of control, pilot wages would "snap back" to a far higher level that was in place before the carrier extracted wage concessions in two bankruptcies in 2002 and 2004. Speculation continues over whether the carrier might merge with United Airlines, a Star alliance partner, or American Airlines.
Pilot contract threatens US Airways merger
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Avianca Holdings: United Air partnership and Synergy infusion raise more questions than answers
Avianca Holdings and United have taken a strategic step to bolster their respective competitiveness in the Latin American and US markets, by working to deepen their partnership. United is the only US airline without a prospective joint venture partner in the region, and Avianca needs an anchor partner such as United to broaden its network coverage in North America.
The scope that Avianca and United’s deepened partnership will encompass remains unknown. Since mid 2016 Avianca has been searching for a strategic investor, and reportedly drew interest from Delta Air Lines and Copa Holdings before settling on United.
At the same time Avianca outlined plans to develop a strategic partnership with United, Avianca’s majority shareholder Synergy pledged to invest USD200 million into the company, which could signal that Synergy remains committed to having sizeable influence over Avianca.
Synergy also plans to obtain necessary regulatory approvals to fold Avianca Brasil into Avianca Holdings. Synergy is the major shareholder of both airlines, but the companies have been run separately for years. The timing is curious, since United also has a minority stake in the Brazilian airline Azul. Synergy’s moves raise questions about United and Azul’s future partnership, as well as the level of ownership United could take in Avianca Holdings.
US-China open skies: a window in 2019 – alignment of airline partnerships & airport infrastructure
The year 2019 presents a possible opening for China and the United States to sign an open skies agreement. This would principally lift restrictions on flights between the countries – important, since both nations have saturated primary traffic rights and there have been unsuccessful negotiations to expand the allotment.
Most importantly, open skies is a prerequisite for US approval of US-China airlines' joint ventures with antitrust immunity. These partnerships permit airlines to coordinate networks and pricing jointly – which, they say, increases consumer choice, but which other groups worry reduces competition, after experience in the trans-Atlantic market.
Perhaps paradoxically, the lure of a JV will mean that the airlines lobby their governments for open skies that might eventually reduce competition. US airlines will want greater slot availability at Shanghai and Beijing, which could occur in 2019.
Finally, airlines will need to have confidence in a shared future with their partner. China Eastern is close to Delta, while China Southern has a young partnership with American Airlines. Air China, however, does not feel close to United Airlines, which has the highest presence of its own metal in the market. Air China questions whether United actually wants open skies. There is unlikely to be any government deal without the support of Air China, the flag carrier, and a major airline that enjoys a close relationship with the regulator.