United Airlines and Continental Airlines to merge

[MM 6,562]

Today we announced that United Airlines and Continental Airlines will combine to create the world's leading airline, offering unmatched benefits and opportunities for business and leisure travelers and frequent flyers. As one of our most valued members, we want to provide you with additional information on the merger.

 

More Access to More Destinations

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The new airline will be called United Airlines and will offer exceptional international gateways to Asia, Europe, Latin America and the Middle East from anywhere in the United States. Among other things, Continental's fuel- efficient fleet, New York hub and extensive Latin American routes, will combine with United's excellent domestic hub structure, Pacific routes and leading global brand.

 

The airline will have ten hubs, including hubs in the four largest U.S. cities. The new airline will serve 144 million customers per year as it flies to 370 destinations in 59 countries. We will also continue to provide service to all of the communities that United or Continental currently serve, including more than 140 small metropolitan areas and communities.

 

Shared Commitment to Performance and Service

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Our new airline will combine our shared commitment to customer service with industry-leading on-time performance.

We will be positioned to invest in globally competitive products, upgrade technology, refurbish and replace older aircraft, and implement best-in-class practices of both airlines. Our combined airline will have the most modern, fuel-efficient fleet (adjusted for cabin mix) and 75 new technology planes on order.

 

Enhanced Redemption Options

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As an elite member of Mileage Plus, you already benefit from our codesharing relationship and joint membership with Continental in Star Alliance. You have the opportunity to book travel and earn and redeem miles on either airline. Red Carpet Club members have reciprocal privileges with Continental's President's Club lounges.

 

After the merger closes, which is expected to occur near the end of the year, you will participate in the industry's leading loyalty program. Your miles in both programs continue to be valid and can be used according to existing program rules. After the merger closes, we plan to combine our loyalty programs and when that happens, your miles in both programs will be combined into one account. And you will continue to experience the benefits of Star Alliance, including service to more than 1,000 destinations, more connecting opportunities, additional scheduling flexibility and access to reciprocal frequent flyer and airport lounge benefits with Star Alliance's 24 other member airlines around the world.

 

Based on our ongoing codeshare and joint venture partnerships and collaboration in Star Alliance, we are confident that we can successfully and seamlessly integrate our companies.

 

Until the merger closes, United and Continental will operate independently as competitors and remain focused on improving your flying experience.

[sick buffalo 15]

Air travel will get more expensive...

[chuckrivera 1]

As long as they don't make it any harder to keep my 1K, then I'm fine with it.

[LBJ 533]

A 24+ hour flight still sucks no matter what airline it is and I'll still be arriving in BKK at midnight.

[berettakid 26]

They bought out Yorksire airlines as well which is an improvement over continental

 

 

i am sure its where continental got their stewardesses from lol

[Bushcraft 2,583]

There are bound to be more and more mergers as national and other airlines feel a cold wind blowing around their ankles. Let's see if two turkeys can make an eagle.

[Samsonite 181]

A 24+ hour flight still sucks no matter what airline it is and I'll still be arriving in BKK at midnight.

Try one of the Asian airlines from the West Coast. They will get you into BKK around noon instead of midnight.

 

Sad news. Continental was the last American owned airline with a decent reputation.

This merger has been in the wind for many, many months, if not a couple of years on the aviation web sites. IMHO, it shouldn't be allowed. The companies involved in these mega mergers always talk a good story, but the end result is prices go up and service goes down. Hard to believe the service on an American owned airline could get any worst than it already is, but, sigh, it will.

[bigdelta 46]

Well,being #1 for a while was nice while it lasted..........

Here's a look at the combined fleet orders for both carriers:

May 3 (Reuters) - A planned merger of two U.S. companies to

create the world's largest airline will combine Continental's

(CAL.N) Boeing-dominated (BA.N) fleet with the mixed fleet and

order book of United (UAUA.O). [iD:nASA00ASG] The move was expected to trigger a scramble between Boeing

and European rival Airbus (EAD.PA), as well as engine makers,

over the fate of almost $22 billion in outstanding plane orders

and control of any future fleet replacement decisions. United recently split a $10 billion wide-body order between

Boeing and Airbus (EAD.PA) and had been expected to return to

the market later this year to renew its single-aisle fleet.

The merger came weeks after United finalised the Airbus part

of the wide-body deal, which is an order for 25 A350s

provisionally announced in December [iD:nGEE5B715B]. Following are the jetliners on order and yet to be delivered

for each airline, valued at latest published list prices:

CONTINENTAL -----------

AIRBUS

None

BOEING 22 737-700 single-aisle $1,408m

13 737-800 single-aisle $998m

6 737-900ER single-aisle $489m

3 777-200ER wide-body $437m 11 787-8 wide-body $1,829m 14 787-9 wide-body $2,797m Total Boeing $7,958m

Total Airbus + Boeing $7,958m

UNITED ------ AIRBUS 23 A319 single-aisle $1,711m

19 A320 single-aisle $1,547m

25 A350-900 wide-body $6,363m Total Airbus $9,621m

BOEING 25 787-8 wide-body $4,156m

Total Boeing $4,156m

Total Airbus + Boeing $13,777m

MERGED AIRLINE -------------- Airbus $9,621m Boeing $12,114m Airbus + Boeing $21,735m

 

I have obviously been following this more closely than most here and while it will benefit both carriers and the industry as a whole,airfares will indeed increase over time because of the amount of capacity removed from operations.Fewer seats=higher fares.Just as years ago when a carrier had a monopoly on a route,it could basically charge what it wanted.

The next tie-up may be American and US Scare-though a way off.Or American and JetBlueBalls.And hopefully Delta will buy Alaska Airlines sooner than later.

Edited May 3, 2010 by LTGTR

[bigdelta 46]

Did anyone see this:

Name of Airline Will be United with Continental's Logo and Livery

[ozijeff 9]

We will know things are going to shit when they start using the word 'consolidate'.

 

Although it would be a nice contract to repaint all the planes, supply new stationery etc.

[bigdelta 46]

We will know things are going to shit when they start using the word 'consolidate'.

 

Although it would be a nice contract to repaint all the planes, supply new stationery etc.

 

For years,American has fought consolidation,since their huge mistake in buying TWA.It was almost as big a mistake as us outbidding United for Pan Am (actually we didn't outbid UA,we just offered to take more Pan Am employees than UA did),saying they are just fine as is.Now the screw has turned and they WILL have to find a partner.

Now,AA drops from former #1,before Delta buying NW to become #1,to a very distant #3.

 

"Industry consolidation" has been the catchphrase for some time.Another will happen in the US w/i 3 years involving American.

And hopefuly,Delta will have bought Alaska Airlines by then as mentioned earlier.

[lovedog100 1,372]

Wonderful news for me. I want to go from BKK to Micronesia. As of now, the least costly, yet still outrageous priced way to get there, is take United to Japan, then fly Continental on to Micronesia. Once merged, It should be affordable to go. Woo Hoo OK, I know you will ask why... Micronesia is one of the last places on earth where ladies go topless, and wear grass skirts. It's changing, I'd like to see it before it does.

[bigdelta 46]

Where in Micronesia are you traveling to?

[lovedog100 1,372]

Where in Micronesia are you traveling to?

I want to go to Yap. I hear that the topless women are more prevalent there

[Bushcraft 2,583]

The name should be changed to Paps.

[bigdelta 46]

I want to go to Yap. I hear that the topless women are more prevalent there

I have heard good things about Ponape though the subject of toplessness wasn't discussed.

As an alternate routing to Micronesia,how about a cheap ticket on Air Asia to the Australian island/continent and a separate ticket on another carrier onward?

[lovedog100 1,372]

I have heard good things about Ponape though the subject of toplessness wasn't discussed.

As an alternate routing to Micronesia,how about a cheap ticket on Air Asia to the Australian island/continent and a separate ticket on another carrier onward?

That would be great if it worked. I understood that the only way into Micronesia was through Guam then on Air Micronesia, which is owned by Continental. I looked last year, and the cheapest way to get there was to fly to Hawaii, then back to Guam, Micronesia. That doesn't seem to be true now. I've tried to Singapore, then Guam, Micronesia, and PI, Guam, Micronesia. What do you know that I don't?

[bigdelta 46]

Despite Delta, Mergers Not Easy-

 

CHICAGO (TheStreet) -- Because the last airline merger, between Delta(DAL) and Northwest went smoothly, it is presumed the next merger will go smoothly as well.

And why not? The economy is improving. Continental(CAL) and United(UAUA), which announced their intent to merge on Monday, are performing well. The airline industry, which cut capacity in response to the 2008 fuel-price spike and the subsequent recession, seems to have positioned itself to benefit from the recovery. Still, "airline mergers are not easy work, in part because so many of the major influences are completely outside everyone's control" said consultant Robert Mann, who cited the SARS epidemic, the Sept. 11 attacks, rising fuel costs and a recessionary economy as examples.

"People on TV are saying that putting together these airlines is easy," said Robert Roach, general vice president of the International Association of Machinists. "It isn't. People say the Delta merger is all put together, but (Delta) is still trying to work out representation issues, and a few thousand of people have lost their jobs" since the merger. Additionally, Roach noted, pilots at US Airways(LCC) have yet to work out seniority integration five years after the merger with America West.

Today, it is widely forgotten that before the Delta merger, airline industry chatter frequently included the thought that airline mergers are disruptive and often unsuccessful.

Failure models abound, including Pan Am with National in 1978, Piedmont with US Air in 1987, American(AMR) with Reno in 1999 and American with TWA in 2001. Not to mention the 1986 Texas Air purchase of Eastern, whose stripped assets helped to build the new Continental.

The list goes on and on. Yet the warm glow from the Delta/Northwest merger seems to have overwhelmed the unpleasant memories.

So forgive Roach, who entered the airline industry as a TWA ramp worker, if he raises a few questions. The IAM, by the way, is the largest union at United, representing 16,000 workers: it also represents 9,500 Continental flight attendants.

"There are various scenarios in mergers -- how they intend to integrate and operate; whether certain cities lose service, which means you lose employees, employee pensions, benefit and job security, and the harm or benefit for passengers." Roach said. "We have not seen any details," he said. "Once we scrutinize the filing, once we do all the due diligence, then we will make a decision as to what position we will take."

Pilots at Continental and United seem willing to discuss a deal along the lines of the one that Delta negotiated with its pilots. But the leaders of both pilots unions say the Delta deal is just a starting point, particularly when it comes to outsourcing flying to regional carriers.

One potential loser in the merger is Cleveland Hopkins International Airport, one of the worldwide 10 hubs that would be operated by the combined carriers, but one that appears to have a role similar to that of Chicago's O'Hare International.

Asked about Cleveland's future on a conference call with reporters and analysts, Continental CEO Jeff Smisek, who would lead the new company, responded: "We understand how important good air service is to Cleveland (and) Cleveland will always be important to the combined carrier." However, he said, "We are always responsive to market demand (and) you need to look at where the demand is."

In fact, although Continental calls Cleveland a hub, that role must be defined broadly, because the Cleveland hub has only about 170 daily departures, mostly on regional jets. In 2008 and 2009, Continental briefly tried trans-Atlantic service from Cleveland, first to Paris, then to London, but shut it down in the recession. According to the Cleveland Plain Dealer, Continental has reduced Cleveland flights 24% since late 2007, compared with cutbacks of 18% at Houston and 10% at Newark. Its Cleveland workforce totals 2,200, while its affiliates employ another 1,000.

On Monday, local officials, including U.S. Rep. Dennis Kucinich, held a news conference to seek to assure that the importance of Cleveland Hopkins is not diminished in the merger. "I wouldn't call us a loser, because we don't know," said airport spokeswoman Jacqueline Mayo. "I don't think they have sat down with us and said 'this is what will happen.' I am sure that eventually, (they) will."

Of course, a key question involves regulatory approval. On the conference call, Smisek reminded that the partners have no international route overlap and that "Continental is strong where United is weak and United is strong where Continental is weak." From a regulatory standpoint, this is "a match made in heaven," he said.

Even for airline geeks, it is a challenge to find a route where Continental and United are the only carriers that provide service. Try it. The only one we found was Cleveland-Denver.

Still, it is a bit early to declare victory. Recall that on the Delta earnings conference call in April, CEO Richard Anderson warned that regulatory approval now comes more slowly than it did in the latter days of the Bush administration, when the Delta/Northwest merger was approved in less than seven months. Delay is the foremost enemy of this proposed merger, because that allows for more of the exogenous events that always have and always will plague the airline industry.

[bigdelta 46]

That would be great if it worked. I understood that the only way into Micronesia was through Guam then on Air Micronesia, which is owned by Continental. I looked last year, and the cheapest way to get there was to fly to Hawaii, then back to Guam, Micronesia. That doesn't seem to be true now. I've tried to Singapore, then Guam, Micronesia, and PI, Guam, Micronesia. What do you know that I don't?

 

MNL-GUM $690 RT-add your Yap segment on CO and BKK-MNL segments on whomever.

Or MNL-YAP $1209 just add your BKK-MNL segs and you're good to go.

Doing separate tkts on various carriers works often times.If I liked you better,I'd make more of an effort to help.

Edited May 4, 2010 by LTGTR